Wellness

How To Revamp Your Finances During an Economic Downturn

by Michaela d'Artois

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Wellness

How To Revamp Your Finances During an Economic Downturn

Who would have thought that it’s the perfect time to dive into your finances?

While the landscape of our economy hangs in the balance and we hunker down in preparation for a potential recession, it feels pertinent now more than ever to address the dynamic we share with our personal finances. For many of us, this extreme shift has brought to light areas we could have shown more love to, or others where we were selling ourselves short. So is this the perfect time to revamp our finances? Financial expert Claire Van Holland says yes.

Now that we are forced to come face to face with many aspects about ourselves that we may have been neglecting pre-COVID, this is the perfect opportunity to also reflect on our relationship with money,” she says. “If we can better understand the energy we are putting into it, namely how we spend it, how we receive it, and who we choose to circulate it with, perhaps we can emerge back into a post-COVID world with a deeper sense of abundance that gives more intentional and loving meaning to money’s role in our lives.

If you’re a creative, contractor, or non-essential worker you may be thinking, how can I even consider an accurate budget when I have no idea when my income will return to normal? To lend some peace of mind, we’ve compiled a few simple steps anyone can take to cozy up closer to their money.

Fun For the Future Money

While the bars, concert venues, and weekend getaways we once swiped our plastic at in exchange for a good time are closed indefinitely, we’re finding our entertainment spending has gone down exponentially. Since funds might be tight for a while, we’ve decided to filter that “fun money” into “fun for the future money.” Consider setting up a new savings account with your bank where you can put aside those extra dollars. While this may feel like a small step, the act of taking control can change your attitude toward the stress you may be feeling about these financial unknowns, and seeing the money build up can allow you to feel safer in this time of uncertainty. 

Press Pause

If you’re unsure how you’ll stay on top of all your bills, or even if a few months of not paying pesky interest charges sounds ideal (I mean who could say no to that), many lenders and credit card companies are offering grace periods for their customers. Whether that’s a break in APR, or a pause on payments altogether, it’s worth giving your bank a ring to see what kind of support you’re eligible for. Now, we are not saying ignore what needs to be handled now to face a larger amount of debt later. But if you’ve been looking to get out of debt for a while, this could be the leverage you’ve needed.

“Knowing our bank accounts inside and out gives us authority even when all else feels out of our hands.”

Nothing is Set in Stone

In Nicole Lapin’s New York Times Bestseller “Rich Bitch: A Simple 12-Step Plan for Getting Your Financial Life Together, she teaches that “you can always negotiate a better deal for yourself.” Once you’ve put payments on pause and focus on growing your savings, you can re-approach your bank at the end of the allotted grace period with a negotiation. In fact, Lapin says, “You should always, always negotiate the interest rate you get on your credit cards.”  Same thing goes for late fees, she says. There’s no better time than an economic downturn to practice your negotiating skills. This also goes for bills like phone, internet, and cable providers. Lapin suggests asking your providers if they can give you a better deal than the current plan you’re paying for. Often if you’re a long-standing customer, or if their competitors are offering something better, they have a little wiggle room to work with. Service providers would much rather keep a customer at a lower rate than lose one altogether. 

Become Fluent in Your Finances

Use your downtime to binge out on financial literature, including books, podcasts, and Youtube videos. We have endless resources at our fingertips and can learn almost any angle of our money from the commerce Gurus of the world. If you’re looking for a good jumping-off point, turn to “Money, A Love Story: Untangle Your Financial Woes and Create the Life You Really Wantby Kate Northrup,You Are a Badass at Making Money: Master the Mindset of Wealth by Jen Sincero, and “Explained, Money Energetics from manifestation coach Lacy Philips’ podcast EXPANDED. Knowledge is power, and knowing our bank accounts inside and out gives us authority even when all else feels out of our hands.

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