Balancing spending during the pandemic

By: Cesilia Faustina

Since the start of the COVID-19 pandemic, the economy has been on thin ice all over the world. While some are adapting to online workspaces, some are greatly struggling with unemployment and the need to continue working despite the risks. It is clear that COVID-19 is showcasing some clear winners and losers in the industry spectrum.

Companies that focused on marketing products online are soaring compared to those who don’t. Other than that, digital communication tools like Zoom and online food delivery services are also increasing. According to data from Avalara, since the start of the pandemic there has been a decrease for items unnecessary to everyday life and there was a huge increase in survival, hobbies and home entertainment supplies.

So yes, the pandemic is definitely putting the economy in a state of uncertainty, but you can definitely see the positive impacts for certain industries, I’m talking about the online industry here. Online shopping has increased greatly since the start of the coronavirus and though you would think we would be spending less because of it; it seems to have the opposite effect when it comes to certain products and services.

For example, since the start of all this, there has been a huge trend of baking, and I am sure there are just a flock of people out there looking to buy baking supplies and equipment. Now, I’m not saying baking is bad, it’s a great and productive activity to do during these times, however, how aware are we of the amount of spending we are actually doing?

Consumer spending during COVID-19

Becoming mindless shoppers is an easy thing to become, even before coronavirus started. That said, could we possibly be taking advantage of all this downtime by shopping all the time?

According to Geekwire, the survey from Avalara showed an increase of 209% for home learning supplies, which is a major shift in comparison. This shows that yes, we are spending more online for these items, items previously we never thought as necessary. The pandemic is creating a whole new method of consuming and if we are not careful, we might just fall into a digital capitalist hole.

Source: Geekwire.com

The coronavirus is already creating economic uncertainty, it has cost so many people their jobs, and yes, though you would like to help out the people in need of income, we need still to balance out our spending.

Founder of athletic apparel company Oiselle Sally Bergesen stated in an interview with the New York Times that bigger corporate companies are likely to profit more from this situation than smaller enterprises or start-ups. She talked about how we could become more conscientious shoppers during a pandemic, and you know what? She’s right.

Balancing our spending during this time is not only important for us, but also for those most affected by it, which is why knowing the first step on how to handle your money during these times is key.

Tips for your spending fever

So, with unstable spending in unstable times, here is some advice on how to handle the situation.

Understand your spending habits

First things first, you need to figure out your spending. You can do this via a series of things, like writing down the amount of money you spend after every purchase online or using one of those apps to write down your spending. Doing this can give you a clear idea of your spending habits and can work as a base to making any future spending decisions.

Now, I know this is easier said than done, truth be told, I always forget to write down my spending or rarely do I remember to check at the end of every month, but there are plenty of tools out there to help. In fact, many bank apps even record all your in-and-out transactions within the month, which makes keeping track a whole lot easier, especially with most payments being done digitally since COVID-19. So, see if you’ve already spent a lot last month then try to reach less for the next month.

Aware of your cash flow

Seeing how much money you earn within the month or week is also a key step in this. For example, I would usually hold off on any purchases I don’t see urgent if say I don’t receive my paycheck for another week, while I would get all my essential beginning of the month shopping once my paycheck is in or if I know it is coming in soon.

The amount of money you spend becomes easier once you know the amount of money coming in and out of your pockets. If you are lucky enough to still have a job and know exactly when and how much you are getting paid, cater your spending to that, and if unfortunately, you are unemployed, you would need to be even pickier.

Check out your priorities!

Prioritizing is so important here. The economy is greatly unstable at the moment and not only would you need to think about yourself, but also those who are struggling with income or left unemployed. Surely, purchasing things online is great to help the everyday workers out there but too much spending and you are digging a hole for yourself.

Generally speaking, you would need to think about your spending anyways. Make sure to prioritize your bills and basic needs/items and everything else later. This is very true for everyone, but especially if the pandemic has left you unemployed, this is very important to do while you are still in the midst of job hunting.

In regards to supporting local and small businesses as well, it is also a good idea to purchase items from these types of businesses once in a while, rather than with big corporate companies – they need all the help they can get.

Try to keep some savings

Though things may be tough, whether you are unemployed or your paycheck got cut due to the virus, always try to put aside some cash into your savings, even if it’s not a lot. Your savings can go a long way and it is important to spare some for the unforeseeable future. 

With many people becoming unemployed during these times, your safety net is your cash reserve, so always staying ahead of the game is a must.

All-in-all we are facing uncertain times, but it is important to stay smart and aware of your cash flows and spending. More than ever, our spending not only affects us, but the people around us, and we need to support each other on the changes to come.