Coronavirus is going to change the world in many ways. And one of the changes it has already ushered in is a shift in the way people handle their spending.
And while there's nothing good about the virus or its economic impact, the financial changes that Americans have made in response to it actually have been positive ones. In fact, the habits most people are adopting are worth keeping up even after the threat from the pandemic has passed.
Coronavirus is causing Americans to make smart choices about their spending and saving
According to MX, some of the big changes Americans have made in response to COVID-19 include:
- Saving more money: 34% of survey respondents indicate they've upped their savings rate because of the novel coronavirus.
- Reducing spending: During these turbulent times, 59% of Americans have cut their budgets so they aren't spending as much money as they did pre-pandemic.
- Re-evaluating their priorities: 48% of those surveyed indicate they are prioritizing living expenses, while 30% of respondents indicate their top priority is consumables, including food and drink.
Upping your savings rate, taking a close look at your spending, and making sure your money goes to the things most valuable to you can help see you through a coronavirus recession with your financial situation in tact. In fact, making these changes could help you become more financially stable even if you experience a job loss or cut to your hours, or if you're a retiree who lost some investment money when the stock market crashed.
And if you put these good financial habits in place now and get used to practicing them, you can continue to save more and spend less once the pandemic ends. This should enable you to get on firmer financial footing and be prepared for whatever unexpected events life sends your way in the future.
It's not too late to change your habits
The good news is, if you aren't among the Americans taking these steps, you can choose to start them at any time. You just need to make a few simple changes. Depending on your current financial habits, that could mean:
- Making a budget for the first time so you can make sure your paychecks or unemployment benefits are used as wisely as possible.
- Taking a look at your existing budget and making adjustments that account for the ongoing financial uncertainty the novel coronavirus has caused worldwide.
- Automating a transfer of money to your savings accounts so you're putting more money in the bank and spending less of it.
Smart financial moves pay off even during a crisis
There are some things you shouldn't do in response to black swan events such as the coronavirus pandemic. Cutting back on investing out of fear is one of them, and reacting on emotion when it comes to your investment choices is another. But the good news is, the financial decisions most Americans are making are good ones. Why not join your fellow Americans in making these smart financial moves, if you can.