With the coronavirus pandemic sweeping across the globe, local and national governments are urging residents to stay home and practice social distancing. Social distancing is when people avoid interactions with strangers and those outside of their household. Restaurants and bars are open only for take away, people should keep 1.5 metres distance between others, and most non-essential businesses are closed.
While social distancing is an important way to flatten the curve and ensure hospitals don’t become overwhelmed, how does it affect your budget? It turns out there are a few different ways the pandemic could actually benefit your savings goals if you do it right. If you’re practicing social distancing, pay attention to these potential effects within your budget.
What Social Distancing Means for Your Budget
There are a few things that social distancing might mean for your budget. This will mainly depend on your current financial situation, employment status, and how you typically spend money in a normal timeframe.
First, social distancing has led to the closure of many businesses. Some businesses have closed temporarily since they were considered non-essential while others might never return at all. For those that found themselves laid off from their job, social distancing could be a big challenge to one’s budget. Not only is it hard to look for jobs right now, but high unemployment numbers increase competition for all types of positions.
On the other hand, since it’s no longer possible to do things like go out to eat (except take away) or see a movie, a lot of people are saving money. Over time, these small changes really add up. If you’re savvy with these savings, you could apply for this money towards your debt payoff or your emergency fund for the future. It’s not at all exciting to think about paying off your debts during such uncertain times but if you are able and willing to commit to some increased payments during this period, your future self will thank you for it.
What to Do if Social Distancing is Breaking the Budget
For those that find themselves with limited (or no) income, this pandemic can be scary. You might not know how you’ll make ends meet or how to continue your current financial plans. If you had any outstanding debts, this adds yet another challenge to the mix.
If social distancing is stretching your budget thin, then don’t delay taking action. Here are some ways to make a change for the better:
- Government assistance – The first way to get help is through the Government’s assistance programs. There is both JobSeeker assistance and Coronavirus supplement to help those without work right now. You can apply through Centrelink and talk to your employer about what plan they have in place.
- Cut back on spending – While it’s hard to stay isolated for so long, it’s important to stay away from your previous (pre-pandemic) routine. If possible, cut back on take away, expensive groceries, and other luxuries you don’t need right now. You might even be able to save extra money without affecting your lifestyle.
- Ask for help – Don’t hesitate to ask for help if you need it. If you’re not able to make ends meet, work with a financial expert or talk with friends and family about ways to work together.
- Prepare for the future – Even if you can’t get started right away, give thought to how you can better prepare your budget for the future. What changes need to be made?
Boost Savings During a Pandemic
Believe it or not, social distancing can be a good thing for your budget. Not only does it help you cut down on monthly spending, but you also feel good doing it. Most families are currently spending less on things like:
- Restaurants and dining
- Take away coffee and tea
- Evenings out
- Movies and entertainment
- Petrol and transportation
While you might need to spend more on groceries, this still adds up to big savings over a few weeks. Lean into this time to make your savings work for you and develop some new financial habits along the way. While it might not be fun to spend so much time at home, look for ways to spice things up that don’t cost a dime. Crafting, family fun, and streaming services are all low-cost ways to enjoy this time with your family.
Is Your Budget Prepared?
Social distancing is challenging for everyone, especially if you’re used to leading an active social life. However, it can also be a blessing for your budget. Even if you lost your job recently during the outbreak, most people are spending less than ever before.
It’s important to recognise your own budgeting and financial situation. How can you put your family’s social distancing to work for you? When in doubt, talk to an expert. We’re here to help! One of our friendly team members can assist you with creating a plan for your budget during this pandemic. Contact us today on 1300 368 322 to get started!