A New Way of Spending
The way we spend money has changed and it is time for us to realize and adjust. The cancelation of travel plans, day camps, and sporting events has helped us save some serious cash. We hardly realize how much we spent on these luxuries, when we look back and count, we are dumbfounded. Now the question is what lifestyle changes do we need to make as a result? For some of us it provides a new way to save for large purchases or retirement. While for others we are able to indulge in new ways on a scale we never thought possible, but in the end we must remember to make wise financial choices.
What We Have Saved
The average person does not think about money in great detail. We all have and know our approximate monthly responsibilities: Rent or mortgage payments, insurance premiums, car payments, utilities, and whatever other consistent bills we get. We know how much we need and then we begin budgeting for things like food and entertainment. This part is where we become great at approximating. We do not want to go out for a night downtown with a firm budget in mind. We need to be flexible to make sure we are making the most of the experience. This is where our current savings are coming from. The country was shut down for a lengthy period of time and we were forced to shelter in home. This ensured we no longer were having a few extra beers at the local bar. Most of our food was delivery or drive through pickups and we were not commuting to work either. These small expenses have added up in a big way. Even people who were furloughed or forced on unemployment should have found some reduction in daily spending. Times were harder for this group of people but in the true American fashion, countless individuals made the best of a bad situation and learned how to save money in new unique ways.
Re-budgeting
As we reopen as a country we are going back to work but are still being much more cautious about going out. As a result we are seeing a rise in how much disposable income we save and now we must decide what to do with it. This is a 100% personal preference-based decision. Some of us prefer to improve our quality of life by doing the simple things. We can buy more expensive groceries and eat better. We can spend more money on health products and consumables. We can invest in a hobby or even buy our dream car. No matter what decision you choose make, ensure it is well thought out. A large purchase or long term hobby or project is a substantial commitment while eating better is not. We must realize that the economic climate of our country can potentially change again without much warning. So it is important not put all your cash in one basket.
Investment is always a solid plan for newly found funds and now might be the time to make a smart choice. Once again, we must think about our situation and make the wise move. Are you aware of any local businesses looking for investors or of any up and coming companies who have stock for sale? If you have the free time it might be worth looking into, there is risk involved but the reward could be great. When in doubt come up with a short term plan, a simple savings account is never a bad thing. We do not want to have too much money in our personal checking account, no interest is earned there. So, in the short term, opening a savings account is a great choice. Just make sure the account does not have any unnecessary fees and there is no penalty for withdrawing from it or closing it. However, financial savings and investments are not the only option. Now might be a great time to increase the value of your home by doing the home improvement project you always dreamed of. Do some research and determine what updates you need to make and how much they cost. From there you can make an educated decision to ensure you get the most value for your dollar.
It’s not all about Spending
So far, we have discussed ways to spend money that we are saving as a result of recent economical climate changes. Now we must spend a few minutes to talk about continuing to save. No matter how young or old you are saving for retirement is always a sound decision. Our saved expenses or even our stimulus check affords us the opportunity to make a commitment for our future. So do not be afraid to call your local investment firm and learn about new ways to invest in your future. For those of us with jobs at major companies it might be time to looking into company sponsored 401k programs or to commit more money in to a plan we already have. However, this is not the only way to invest in our future. Some of us might want to use the money toward higher education to get the degree or certificate we have always wants. In doing so we are investing in ourselves and increase how much money we will earn and save for retirement long term. Finally, we all have dreams and saving money now might help us reach our dreams later in life. A small savings account with a small regular deposit can become a fortune if given enough time. So, make a dream trip or buy the dream car fund. Save whatever you can toward whatever life changing purchase you want to make. Just remember to find ways for this savings to at least earn some interest.
For many people the change in the financial environment has created opportunities and the American dream is being able to turn these opportunities into successes. Even people who were less fortunate and lost their jobs have the opportunity to change their life. We live in the land of opportunity and it is important to remember that and see everything as a way to grow. The COVID-19 virus has created many challenges for many people but every time a door closes another one opens somewhere. We just have to make good decisions, seize the moment, and find it. Now is the perfect time to do this with your finances. Make good decisions and fortune will eventually follow in some form.