Get Most Out Of Your Finances, Nabil Sabio Azadi had once said “When fishermen cannot go to sea, they repair nets.” Spending the weekend at home isn’t ideal, but this is a national emergency. Nonetheless, this gives us the opportunity to determine ways to manage our finances better, which could be useful even after the end of this pandemic. The lockdown has greatly limited our ability to go out of the house to spend money on our wanton desires. This extended home-stay will help you analyze your needs vs. wants.
While everyone’s situation is different, here are 10 ways that can serve as a good starting point:
1. The 50-30-20 Rule
This is a popular rule for breaking down your budget. The 50-30-20 rule puts 50% of your income towards necessities, like housing, education, and bills. 20% then goes towards financial goals, like paying off debt or saving for retirement or debt/equity mutual funds that can be used as a corpus for large expenses. Finally, 30% of your income can be allocated to wants, like dining or entertainment.
There are also variations to this rule, like the more flexible 80-20 rule, in which you use 20% of your income for financial goals then spend 80 percent on everything else. If you’re not sure where to start with a budget, breaking it up into these basic categories could be really helpful. Those percentages help create a balance between obligations, goals and splurges
2. Rediscover the Stove
The resurgence of family meals is one of the precious few good things that have come from the pandemic. Since we have been gifted with the most precious of commodities: time, why not meander through the internet for videos & recipies on how to make meals that stretch & improvising with less-than-ideal ingredients? Post quarantine, make cooking with the family a weekly activity. You will be less dependent on ordering in expensive restaurant-food, which will lead to savings.
3. A Dash of Minimalism
Use this time of your unprecedented home-stay to clear out all the equipment you haven’t used in the last year. Stop stockpiling things in the anticipation of using them someday. Sell off these chattels on platforms like Olx, eBay or Quikr. Better yet, consider donating them to a local NGO.
4. The Cosy Home-Theatre
For a family of four, a movie outing can be quite the splurge considering the cost of multiplex tickets & extravagantly priced theatre snacks. A plethora of fresh releases as well as crowd-favourites are now available on OTT platforms like Netflix, Amazon Prime & Hotstar. Build a blanket-fort together and canoodle in it with a bowl of buttered-popcorn and other homespun munchies. After the pandemic is taken care of, this family-event can be socialised by inviting in your friends for a fun evening.
5. Reconsider Your Subscriptions
Analyze the gym and social (clubs & kitties) memberships you have. Discern how often you actually go to them. If your engagement is less than 25% in the previous year, consider giving up these memberships. Furthermore, have a look at the paid software you have on your devices. If you have not used them over the past 6 months, consider downgrading to the free versions or using their free substitutes.
6. Sell off that Jalopy
With the advent of ride-hailing taxi apps like Ola & Uber it has become easier for millenials to commute. More than one automobiles resting in your garage? Consider selling one. Love the steering? You have plenty of self-drive car rental services like ZoomCar at your disposal. Picture the money you can salvage in car EMIs, maintenance, petrol and parking charges through this one deed.
7. Frugality is the Key
Burgeon a frugal ethos and discern ways you can save money. Identify the credit cards/online payment services that give you the best cash-backs or rewards and use them as a priority. While you’re trapped inside, go DIY with your beauty regimes. Give yourself an organic hair spa, a yoghurt face mask or a zesty foot soak. Raise the temperature of your air conditioner to at least 24 degrees and your body will adapt to the moderate temperature in a matter of days. Take all electronics (TVs, ACs or Laptops) out of standby mode and save up on your monthly electrical bills whilst doing your bit for the planet. Look up this information superhighway for more such nickel-and-dime ways to save up on the cash. All the little savings will add up to a lot.
8. Up For a Side Hustle?
Start an online business or an online job in outside your 9-5 office hours. There are many websites that let you bid for ventures ranging from content writing to larger consultancy projects. Numerous websites let you tutor online and procure you with other online job opportunities. None of these require any fixed asset except your time.
According to Warren Buffet, the most favourable time to buy is when everyone else is selling. The stock exchange will be extremely erratic in the coming year. However, due to the air of fear encapsulating the financial scene, most people are selling off their stocks and valuations are at all time lows. If you have a pool of reserves that you do not require for your vital expenses, you might want to purchase stocks of reputed firms as the market plunges. This could give you confounding returns on your assets in the long run.
10. Acknowledge Your Privilege
The pandemic is certain to wreck havoc on numerous sections of the society. Not everyone would be able to weather the storm as easily as you can. Support small businesses: Purchase supplies from small shops and hawkers as they need your money more than the large grocery outlets. Stop heckling with impecunious vendors for a five or ten off your grocery. Donate money or time to NGOs or individuals who are extending relief measures to those greatly affected by the lockdown, like stray animals or the homeless. There are a profusion of online charities making the rounds but be vigilant & only donate to trusted entities.
Taking the time to manage your money better can really pay off. It can help you stay on top of your bills and save thousands each year. Make the best of this unpremeditated sojourn to come out financially stronger and gain benefits that will last a lifetime. Spend these extra savings on your next car or holiday and build an eternity of memories.