Bank Better, Live Better
Your 6-step guide to rebooting your budget during lockdown23/04/2020
Although the current COVID-19 pandemic is putting financial strain on many people, now is the time to relook your budget.
We’re living in stressful times but no matter what your current circumstances are, taking the time to carefully examine budget can help you to be more in control. You’re not alone if you feel as though everything has changed. We don’t know how long things will continue in this way, or how you may be affected over time.
How do you future-proof your budget for the new context, and give yourself a greater sense of control and security? By using lockdown to reboot your budget.
Relook your budget
This is first step to look after your financial health. To do this you need to check that your budget contains 3 key elements:
- What you earn
- What you spend
- What you save
Then see what has changed since lockdown, whether there’s been a change in your income or expenses. Need some help creating a budget? Check out this article.
See where you can save money
Since lockdown started, you’ve probably already saved on a number of expenses like petrol, parking, take-away coffees and eating out. Now’s the time to relook all your memberships and subscriptions, and cancel the ones you don’t use.
Being at home 24/7 comes with added expenses like paying more for using more electricity and water. See how you can minimise these expenses. As the days start to get colder, dress warmly and use blankets instead of putting on a heater. Watch your water consumption by keeping your showers short and only washing full loads of (dirty) clothing.
Don’t forget about your food bill. Organise your kitchen and create meals around expiry dates to avoid wasting food. Only buy what you will use before your next shopping trip. Frozen vegetables last a lot longer than fresh ones.
Write a list of all the things you can live without
Living through lockdown has shown us that we can live without things we never imagined possible. What luxuries have you discovered you can do without? They fall in the “wants” category and don’t count as needs. We can live without wants.
Create a strategy for an emergency fund
One of the lessons to come out of the COVID-19 pandemic is just how important it is to have an emergency fund for unexpected situations.
Ideally you want to save enough to cover at least 3 months’ expenses. This will protect you from slipping back into debt when faced with an unexpected expense. Also be sure that your money is working for you by putting it in a savings plan that offers the highest possible interest rate.
Remember, emergency savings are vital if you want some security in uncertain times. If you don’t have rainy day savings, don’t stress. It’s never too late to start, and no amount is too little to put away.
Your long-term goal: track your spending
When last did you do a financial audit to see how much you’re really paying in bank fees? Do you check your bank statements every month and take note of how much money is coming in and going out?
Keeping track of every cent you spend is important as it allows you to see where your money goes. It reveals your spending habits so you can distinguish between wants and needs. It also allows you to spot incorrect deductions from your bank account and ultimately stay within your budget.
Capitec keeps banking fees affordable and transparent, with a low monthly admin fee of R5, while also giving you access to 4 savings plans.
Be safe, bank from home
We all have to do our part and stay at home during lockdown, but it doesn’t mean you can’t do your banking. Use the Capitec app to pay people and accounts, buy airtime or electricity, email bank statements and manage debit orders.
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