It’s taboo to say or even think about it, but people have been saving a lot during the pandemic. At least, that’s how it is for those who have not been laid off from work. Laura and Fernan, for example, saved more than they have ever saved during pre-pandemic times. In a survey, more than half of Americans said they were able to save more now because they are not spending on things like going out and shopping.
Even now that restrictions have been lifted, people are still saving much more than they expected. Sure, they are paying more for their utility bills and grocery because the whole family is staying home, but they’re also saving more because they could not travel or eat out. Imagine getting the same salary, but not spending it on luxurious items and experiences such as travelling and shopping.
Real Estate and Mortgage
People are trying to pay as much of their mortgage as they can. If you want to do the same because you have the extra money to do so, you can consult with accountants for property tax and construction. They can discuss with you the benefits and disadvantages of paying off your mortgage earlier. You can even ask them for advice regarding property and income taxes if you’re going to pay off a big chunk of your home loan.
Many people actually finished paying off their mortgage during the pandemic. Others made significant dents to their debt. Isn’t that the goal? You want to say that finally, your home is yours.
Loans and Debts
People are spending less on dining out than they saved more than $500 a month. Where should that money go? Unless it’s in your savings, you’re better off paying your student debts and credit card balances. This is the right thing to do given the uncertain circumstances you are finding this world in. Who’s going to assure you that there’s a job waiting for you tomorrow or next year?
Paying off your remaining loans and debts assures that you don’t have to worry about these if you find yourself without a job. The worst part of losing a job aside from worrying about your career is not knowing where to get the money to pay off your debts. You can starve yourself by eating canned tuna and a dollar pizza, but your credit cards will continue to accumulate interest if you don’t pay those debts off.
Retirement
People are also more concerned about their retirement. Some who didn’t lose their jobs decided to contribute more to their retirement fund. Some are just starting their retirement fund right now. The pandemic opened your eyes to the reality that life is indeed short. Why waste your time working until you’re in your late 60s? You can retire early once you’re financially comfortable and spend more time with your loved ones.
Stock Market
Even those who lost their jobs are finding ways to earn more and to invest in the future. That’s why the stock market becomes obviously their investment of choice. It’s easy enough to invest in the stock market. You can do it through an app on your phone. You can buy and sell stocks through that app. Once you’ve got the hang of the stock market, you will realize why this is such an important component of your investment portfolio.
Home Renovation
Since people are staying more at home, they started noticing what they need to repair around the house. During the height of the lockdown, there were many hardware runs to buy anywhere from DIY cabinets to power tools to gardening supplies. People became more concerned about how comfortable they are at home. They redecorated their rooms and even repainted the exterior walls. If there were things that needed fixing, the lockdown was the perfect time to address these issues.
Luxuries
More than 60% of the people surveyed said they are aware that not many have the same privilege as them. They also feel guilty for enjoying these things when the rest of the world cannot. However, they’re spending more on luxurious items because they’re saving a lot, too. So even though they’re paying off their debts, they also feel that they deserve to have a little luxury here and there. Covid-19, after all, has been very stressful for everyone.
This might actually be the best time to save money. If you didn’t lose your job, take the social distancing measures right now as a way to save some cash, and augment your retirement savings. Remember that it won’t always be this way. Sooner, you can begin travelling and meeting people again. As you well know, socializing, travelling, and the new normal mean spending on these activities again.
