The St. Mary's Blog

The COVID-19 is stressful enough by itself, and to make matters worse, social distancing may be affecting your paycheck. But there’s no need to panic – if you budget carefully, you can make it through any crisis. Many in this position find it helpful to belong to banks or credit unions with budgeting tools – just one of the things that St. Mary’s Credit Union of eastern Massachusetts provides to members every day. Here, we offer some advice for building a reliable financial plan for riding out difficult times, from COVID-19 and beyond.

Keep Calm and Prioritize

The first step in building a crisis budget is to keep calm and evaluate your current financial standing. Start by accounting for your current income and savings, and don’t include any sources of income that are unreliable or uncertain. If you have any investments or an emergency fund, be sure to include those in your evaluation as well.

After evaluating what you have, move on to your expenses. Think carefully and critically about what you know you can’t live without. For instance, you can’t skip rent or mortgage payments, and you need to budget for gas and groceries. Plus, if you’re working from home, you’ll need phone and internet services.

Reduce Nonessential Expenses

Once you know what you have and need, cut out all nonessentials. What do you actually need? Are three streaming services really necessary, or can you get by with one or even zero? Can you give up more expensive meals for now? Skip Dunkin runs and make your own coffee? Consider any ways to lower your expenses with these helpful tips:

• Turn down your thermostat and wear layers.
• Unplug unused appliances.
• Leave the lights off when you can.
• Take shorter showers.
• Find a less expensive internet or phone plan.
• Only drive when you absolutely have to.
• Exercise outside instead of paying for a workout subscription.

If you’re trying to save for a goal, this is also the time to put it on pause.  Make minimum payments on that student loan, and set aside any expensive projects for the future. As important as your goals are, it’s more important during a crisis to have cash on hand to support yourself. You can start working toward those goals again when you’re back to making a steady income and confident in your situation.

Plan for the Future

You may not want to accept that a difficult situation will be long-term. Regardless of the crisis, however, don’t assume that times will change quickly. Instead, treat the situation as a new normal. Plan your new budget to be sustainable for the next few months at least, if not longer.

Also, think of ways you can save. This might sound strange during a crisis, but if you can afford it, even the smallest contributions count. Don’t invest recklessly, but let your fortune slowly build – even a little bit at a time. A small amount of savings can help you feel like you have more control over your circumstances and can help you further when the crisis ends.

Budget with Your Bank

All these budget tips are great during COVID-19, but they’re also helpful during any personal or economic crisis. While you’re budgeting for difficult times, however, don’t forget about your bank. Many financial institutions offer budgeting tools and guides to help you tackle unpredictable circumstances. At each of St. Mary’s Credit Union’s locations in Massachusetts, we offer a variety of tools for this purpose. Contact us to find out more about how we can help or to get started today.