It’s fair to say that 2020 hasn’t quite panned out to be the year that any of us were expecting. As much as I’ve tried to avoid writing anything about COVID-19 over the last few months, the situation has progressed to a stage that it’s now impossible to ignore. Coronavirus has dominated the world this year, and to avoid the topic altogether would be remiss. There’s a lot that can be said about the events and consequences of the last six months, but in this post, I want to look at some important budgeting tips to help us all cope with one of the other casualties of the crisis; our finances.
The pandemic has not only had huge health-based outcomes for the global community but it’s caused a massive amount of uncertainty around our economics and employment. Businesses across the world have had to adapt with speed to the evolution of the virus, and what this has meant for its workforces. Here in the UK, many workers have faced huge struggles with their wellbeing, work-life balance and of course, their job security.
And while the furlough scheme was welcomed in the short term, many workers were simply made redundant or paid a lot less than they were used to in June this year. According to the CIPD:
Over half (55%) of furloughed workers in June said their financial security has worsened since the onset of the pandemic with 28% of non-furloughed workers also in agreement.https://www.cipd.co.uk/knowledge/work/trends/goodwork/covid-impact
Although things have returned to a semi-state of normality for some, there are still huge question marks over the future job security and financial wellbeing of many of us. So, what steps can be taken to help keep your finances stable during such an uncertain time? And why is doing this so important? Well for one, it’s not just about financial stability.
Mental health and wellbeing are more important than ever right now, and one aspect of maintaining a sense of control over that is, for me, to ensure I’m doing what I can to keep my finances in good shape. As a self-employed person, these last few months have been extremely challenging, so in this post, I’m going to share some budgeting tips that have helped me to stay afloat recently.
If you’re one of the thousands who’ve unfortunately lost their jobs since March, then hopefully this post will have some helpful tips for you to help tide you over too.
Budgeting tips during a pandemic
There’s a heading I never envisaged myself writing, but here we are. One of the main things I’ve had to do during the last few months, aside from getting much more organised, is to start budgeting. Properly. Having always been quite a frugal person, this wasn’t a new concept, but one of the more challenging aspects of the restrictions imposed was having to budget for groceries and food shopping. As one of the families who had to ‘shield’, this meant that even going to the supermarket was an unnecessary risk during the lockdown period, so I had to get smarter about online shopping, as well as everything else.
There are some key areas for budgeting during a pandemic, so I’ll outline the ones that have been most important for me in sections here. If you’ve got any budgeting tips or advice of your own, please do share them in the comments below. We can all do our bit to help each other right now!
Generating some additional cash during the pandemic has also been difficult, but not impossible. I’ll include some ways that I’ve managed to boost my cash flow over the last few months, in case you’re looking for some help.
Budgeting tips for food shopping
In the early weeks of lockdown, I found that I was grocery shopping ad hoc, and consequently spending a lot more than I normally would do at my local Lidl. Unfortunately due to the stockpiling that went on, my options were limited. So, I knew that I’d have to do my online shop at one of the big four supermarkets instead, which meant getting serious about my budget.
One of the tools I used to do this was an overall budget calculator, and then with a figure in mind, my food shop became a lot more streamlined. Calculating delivery costs is also an important part of this; I was shocked at how difficult it was to book a shopping slot in the first place, and the ones that were available were often around £4-5 to book!
Over the following weeks, I was able to create a set list of cupboard staples that tied into my budget. Then, by organising my product choices into online lists, my food shopping became a lot more streamlined. I’ve never been a big brand-name buyer, so was able to save some cash out of my shopping budget by sticking to supermarket own-brand products as much as possible.
Swapping out fresh fruit for tinned, making more use of frozen veg; simple things that made a big impact on spending. Although a lot of this may seem like common sense, it surprised me to see how much money and food we’d been wasting prior to the pandemic.
Budget calculators are a good starting point for a time such as this and can be applied to a wide set of circumstances. As well as budgeting for my food shopping, another thing I found helpful was to set myself a business budget.
As a self-employed person, I’ve always been acutely aware of the fact that if I don’t work, my business doesn’t work either. When the schools were shut down, my working output halved immediately. I was in charge of homeschooling my child, a task which I was more than happy to do, but as a result, my focus had to shift from creating content to creating lesson plans. When I was able to catch up, I noticed that a lot of my business income had dropped as a result, so I had to start planning ways to make up for this.
If you’re in the same boat as me, you’ll probably have noticed the same trend. However, it’s never too late to start budgeting for growth! My plan for the three months until year-end is to catch up with work lost over the lockdown period and output more creative content to redress the balance.
Budgeting for business for me now means budgeting my time more carefully – by getting organised and dedicating my available hours to set projects, I’m confident that the balance can be shifted back to a stronger income than expenditure.
Plan ahead for possible spending needs such as Christmas, new equipment, potential marketing costs and other business expenses, and you’ll know how much you’ve got to compensate for in the meantime.
Evaluating your current spend
By looking carefully at our household’s pre-pandemic spending, I was able to see where a lot of savings could be made. For example, the sheer amount of weekly spending that was going on takeaway food! I’ve mentioned this before, but those little spends do really mount up after a while. As those businesses shut down and takeaway food was deemed too risky for my family, I found we were able to save a good £20-30 a week at least just by not splashing out on treats. Additionally, petrol and fuel costs became apparent.
Before the lockdown, petrol was probably costing around £80 a week, if not more. By cutting that cost out and all members of my household being home-based, a big chunk of spare cash became available. However, instead of using this on treats and further shopping, I decided the best thing to do would be to bank it and put it towards a future savings goal; a family holiday (whenever that may happen).
Setting a savings goal
I know, it might sound like madness given the current state of things. But when I mentioned mental health and wellbeing earlier, I wasn’t kidding. With such global uncertainty, anxiety and fear, one thing that’s helped my family and I stay on top of things is to have a goal in mind for when this is eventually over. I think it could be good for you too if you don’t currently have one.
Setting even a tiny bit of our saved spend to one side to go towards this goal has helped me to stay focused. It’s hard to see the positives when you’re wading through uncertainty on a daily basis. However, having that one goal in mind can be your light at the end of the tunnel. Whether it’s a holiday, a new car, a piece of furniture you’ve always wanted, or just some kind of new project to aim for – setting a savings goal has helped me hugely over the last few months.
Generating some extra cash
Another important aspect of life during the COVID-19 crisis has been actually putting systems in place to help me generate additional income. When things first started to go into lockdown and work opportunities began to dry up, I had to set a few online cash boosters in place.
These can be anything from doing paid surveys to online paid research studies or outsourcing a skill. I started to do digital art commissions for my Twitter followers, which proved very popular! I also set up a tipping page where people could buy me a virtual coffee if they felt like it. Small cash boosters like that can go a long way when you’re consistent.
Look for digital work opportunities and make sure you do those small tasks every day. The pounds can mount up quicker than you might think. Don’t forget, you can earn up to £1,000 in the UK before having to register for self-employment. So, sell some of those unwanted clothes, look into getting some free cryptocurrency, proofread people’s assignments for extra cash, do ten surveys a day; whatever you need to do!
What would be your budgeting tips for pandemic life?
I’d love to hear what you think about this. The COVID-19 crisis has affected us all hugely in one way or another. Share your experiences in the comments and if you have any advice for budgeting, saving or generating some extra money then do let us know.
For the most up-to-date and accurate advice regarding the COVID-19 pandemic, I recommend visiting the World Health Organisation’s website for the latest information. Keep yourselves and your families safe!