There is a ton of uncertainty all around us. I’m doing my best to focus on smart money moves that I can make right now.
Access to information is both helping and hurting me in this current situation. I love keeping updated about what is going on, and as a numbers nerd, I am all in on tracking exponential growth. But there are also things that I read that make me very anxious.
Every number is a person and sometimes with the numbers growing so fast, it can feel hopeless. I am very lucky to still have my job but even that could change. And there are many people around me and in my life that are not so lucky.
But as a goal-oriented person, I believe there are things we can do right now to help our financial situation, things that are in our control. By focusing on the things in my control the uncertainty seems a little bit more manageable.
Even with an emergency fund, multiple income sources and a somewhat stable job I would be lying if I said that the current economic situation didn’t scare me. Here are 10 smart money moves that are under my control that I am making right now. And the bonus factor is, a lot of these will work in good economic times too.
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Smart Money Move #1 – Review Your Expenses
The first smart money move I always recommend to anyone is to review your expenses. If you have never taken time to see where your money is going, now is the perfect time. Pull out your statements or log in to your online banking accounts, and get a pen and beverage of your choice.
Write down every expense you have made in the past 3 months. If you want help organizing this information, sign up for my free Expense Tracking Workbook.
This is a no-judgment zone, just write down every expense so that you can see where your money is going.
I personally have tracked my expenses for the past few years. Even though currently I am not strictly “budgeting,” I can learn a lot of information from tracking where my money goes.
It’s important to note that if you are an annual payer like me (for things like auto insurance and property taxes) you will also want to make note of all these large annual expenses in your review.
Smart Money Move #2 – Cut Out Expenses
With self-isolating, social distancing and the closing of many businesses, right now cutting out expenses is becoming uncomfortably easier.
In normal circumstances, I would suggest looking at your expense review and see what expenses can be easily eliminated without affecting your quality of life. Are you still paying for a subscription service that you no longer use? Can you go without buying new clothes for the next few months?
During this pandemic, we have cut out a lot of our entertainment costs and have reduced our fun money. Once businesses open up again we can increase our spending in these areas.
Smart Money Move #3 – Negotiate Expenses
Next, it’s time to negotiate some of your recurring expenses. Companies will be looking to retain your business, so call them and see what loyalty discounts they offer. It never hurts to ask, the worst a company can say is no and you are back to where you started.
Personally, I take some time each year to negotiate my expenses. I have successfully saved hundreds of dollars a year by negotiating my phone bill, insurance bills, mortgage rate and with my internet provider.
If you’re concerned that you do not know how to negotiate your expenses, here are a few things to keep in mind.
- Always be courteous and friendly
- Ask politely
- Sometimes you will need to hang up and call back to talk to someone else
- Know competitive offers (shop around first)
- Be prepared to change providers
While you’re working from home right now, make this smart money move and take a couple of hours to call and negotiate your bills. You have nothing to lose and everything to gain.
Smart Money Move #4 – Meal Plan/Eat From Your Pantry
I have always been told that meal planning can save money. And I’ve tried meal planning over and over again and it just never seemed to work for my family. Then something changed, a few months ago, we tried again and this time it stuck.
And yes, it is saving us money every month on groceries. We are wasting less food and eating everything we make because we now have a plan for our food.
Currently, during this time of physical distancing and self-isolation, we are also eating from our pantry. You can get very creative when you need to in order to come up with new meals to try. All the extra food we had in our pantry was just money sitting there. By eating this food, we can spend less money on groceries every month.
Being more conscious of the food you buy and consume will save you money. It will also become more important if there is ever a supply chain issue that leads to empty grocery store shelves.
Smart Money Move #5 – Take Advantage of Government Assistance Programs
Federal, provincial and state governments are starting to announce their government stimulus packages. Now is the time to apply and benefit from these programs if you are eligible and in need.
If you are lucky enough to not be in need of these programs but still qualify for them, use this money to help out family and friends. It sickens me to read about Americans talking about using their stimulus cheques to invest in the market when there are people out there that need that money to feed their families.
Smart Money Move #6 – High -Interest Savings Account
If you do have an emergency fund right now making sure it is in a high-interest savings account could earn you a few extra dollars in interest every month.
A few months ago I opened a savings account at EQ Bank, and although the savings rate has fluctuated slightly due to this pandemic, I’m happy to earn some extra money every month. Right now the interest you can earn on your high-interest savings account may not be very much. But it’s better than nothing.
Smart Money Move #7 – Lower Your Mortgage Payment
If you have a mortgage payment, then now is the time to get smart about it.
Prior to this financial crisis, we had set up our mortgage payment to be bi-weekly and we increased that payment slightly. We have a goal of wanting to pay off our mortgage as fast as possible.
Switching to Monthly Payments
Now may be the time to review this goal in light of current economic circumstances. Changing our mortgage payment back to monthly payments for the next few months would save us $285.98 every month. That money will be better spent on necessities than accelerating our mortgage payments.
If you are currently paying anything but monthly mortgage payments, the smart money move is to look into your options. Changing your payment frequency may keep some much-needed money in your own pocket. And changing the frequency will not affect your credit or the terms of the loan – as long as you are making changes as per your mortgage terms.
Smart Money Move #8 – Pause Your Mortgage Payment
Pausing or deferring your mortgage payment may already be an option for you regardless of the current global economic circumstance.
Many mortgages have a one-month deferral/pause written into the terms of the mortgage. If you are unsure if your mortgage has this term, there are a couple of places you can check.
Where to find the terms of your mortgage
First, log into your online mortgage account and see if you can see pausing a payment as an option. Some banks make it as easy as clicking a button to put your mortgage payment on hold for a month.
If you do not see it in your online account, then your next option is to check your mortgage documents. These are slightly more difficult to navigate than on the online website. And you should have received a copy of them from your lawyer as part of your closing documents.
Lastly, you always have the option of calling the bank or mortgage broker that initially helped you with the mortgage. They will be able to look into this for you and provide you with what the possibilities are with your mortgage.
All that being said, right now we are not in a normal economic circumstance. Because of this many banks have stated they may defer mortgage payments for up to 6 months. Before you jump on this option, make sure you understand all the ins and outs of this decision.
A 6-month mortgage deferral is not a free ride, interest will still accrue during that time and will eventually come due and the principal payments get tacked onto the backend of the mortgage. In some cases, this may also affect your credit score temporarily.
But if the choice is to defer your mortgage and have money for groceries or pay your mortgage and not have money for necessities, then I would go with the later.
Personally we are not deferring our mortgage payments right now. But we are aware of that as an option and may pull that lever eventually if things get worse.
Smart Money Move #9 – Use Loyalty Points
Do you have a bunch of loyalty points saved up? Now may be a good time to cash them in, emphasis on the may. Courtney over at Your Average Dough recently wrote about how she is planning on using her credit card rewards points as an unconventional emergency fund.
I love loyalty points and am a member of more programs than I really need to be. But all those points give me an advantage right now. Currently, I have enough points to buy months’ worth of groceries, or new clothes for my little one because she is growing so fast and thrift stores are closed.
With the reward points that I have, many of the programs let me convert those points into gift cards for various businesses. Yes, the conversion rate may not be the best, travel tends to offer the best conversion rates. But, travel is off the table for us right now for the indefinite future.
The smart money move is to cash in some of my loyalty points to help pay for necessities rather than go into debt saving those points for future travel.
Smart Money Move #10 – Ask for/Offer Help
As I have said before, now is not the time to be proud. If you need help financially or otherwise, now is the time to ask.
I know how difficult it can be to ask for help sometimes. There have been plenty of times that I have needed help and someone has been there for me.
Now, it’s my turn to give back. If you are not in need of help, the smart money move is to help someone else. I’m currently in a position that I do not need help but can offer it.
So if you are struggling right now, seek out a confidant to confide in and ask for guidance. That person may not be able to help you, but they may know someone who can.
Smart Money Moves Recap
- Review Your Expenses
- Cut out Expenses
- Negotiate Expenses
- Meal Plan/Eat From Your Pantry
- Take Advantage of Government Assistance Programs
- High-Interest Savings Account
- Lower your Mortgage Payment
- Pause Your Mortgage Payment
- Use Loyalty Points
- Ask for/Offer Help
Good economic times or not, all of these smart money moves will help you reset your finances. It is in tough times like this that I am often reminded to go back to the basics. None of the above smart money moves ia anything fancy. They are about getting back to the basics.
Take the extra time you may have now and be mindful, don’t panic, and review your finances. Implementing even just a few of these smart money moves can go a long way to decreasing stress and improving your financial situation.