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Wealth

Now is the Time To Build Emergency Savings

About 4 billion people around the world are under some form of lockdown right now due to the Covid-19 coronavirus. Except to get groceries, many of us haven’t left the house in weeks. 

If you’re one of the lucky salaried employees able to work from home count your blessings! You’ve just been forced onto a highly restrictive spending diet. 

If you’re like me you haven’t bought anything except food over the past couple weeks. My only other bills are utilities and mortgage payments. Many people are saving a ton of money right now.

This is a rare opportunity that might soon vanish. Use this to your advantage!

If you have still been spending money, stop. After all, with unemployment skyrocketing we don’t know how long we will keep earning an income. At this point, each paycheck we receive should be able to cover about 3 pay-periods worth of expenses. We need to do this so if we lose our jobs we have money to continue living. 

Actual experiences may vary, depending on the size of your fixed costs (rent, mortgage payments, utilities, etc.). If you’re still spending a considerable portion of your paycheck on these fixed expenses, take some time to go through each one. Can you cut back? Can you renegotiate with your provider? It is worth the effort and right now banks, telecoms and utility providers might be more receptive to your negotiation requests.

You’re at home working, eating and watching TV. So take the time and effort to AGGRESSIVELY minimize your spending. Essentially, what I’m saying is – if you’re still getting a regular paycheck – you now have an unprecedented opportunity to build your emergency savings. Use it wisely.

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