7 Smart Spending Strategies in a Tough Economy
Even if you have held onto your job during the coronavirus pandemic, you probably are looking for smart spending strategies and have been more than anxious about your bank account.
After all, the unemployment rate is high – officially it was 13.3% for May, although if it wasn't for a data collections process error, according to the Bureau of Labor Statistics, it would be around 16.3% – and nobody knows what financial future lies ahead.
So if you're looking for smart spending strategies in a tough economy, you may want to try the following.
- Create a budget.
- Dine out – at home.
- Plan out your meals.
- Track your spending.
- Before your buy, talk it over.
- Keep your credit card information off of websites.
- Apply for a credit card.
Create a Budget
In a nutshell, you can put together a budget by keeping track of your monthly expenses after taxes. Generally, that's going to be housing expenses, food, clothing, health care, transportation and miscellaneous costs.
But, of course, it's not that easy. If you have pets, do you spread out those costs over groceries (pet food) and health care (veterinary visits) or stick them into "miscellaneous"? What about the expenses that aren't monthly but show up periodically throughout the year, like back-to-school shopping, holiday shopping, birthday gifts and oil changes?
All of that said, it really doesn't matter how you categorize those hard-to-place expenses, as long as you keep track of them somewhere and somehow.
There are also numerous ways to keep track of a budget, from using money management apps to budget calendars to writing everything down on paper or in a Word document. You could spend hours and hours crafting the perfect budget – they're that important.
Rebecca Hunter, CEO of TheLoadedPig.com, a personal finance website, has a smart suggestion to keep in mind for people creating – or reworking – a budget: Make sure your budget includes some room for fun stuff that you don't need.
"So many people are trying budgeting strategies right now and may even try to cut out all wants from their spending. Unfortunately, this leads to impulse buying and, in some cases, racking up credit card debt. A way to prevent impulse buying and to maintain mental health is by allocating a small amount of your monthly budget to wants," Hunter says.