While the COVID-19 pandemic has brought on significant challenges, there was a silver lining for many Canadians. Earlier this year, CBC News reported that the average Canadian had saved more than $5000 over the course of the pandemic thanks to staying home and spending less. While this does not apply to those who dealt with financial hardship due to job loss, it does include a large number of individuals and their families.
Now, as in-person events and social activities gradually return, those days of saving money may feel like a thing of the past. The pandemic isn’t over, but many individuals are cautiously venturing out to concerts and other social events, or even considering travel. It’s a pretty great feeling, but we encourage everyone to follow their local public health recommendations and also consider their financial situation in the weeks and months to come. Here are some tips for transitioning out of the pandemic and enjoying yourself while being financially responsible.
Revisit your budget
If you’ve been staying home more and avoiding travel/entertainment for nearly two years, your financial situation may have changed since you last reviewed your budget. Have you changed jobs or increased your income? Are your fixed expenses the same as two years ago, and do you need to reconsider the estimated cost of your variable expenses?
Start by revisiting your monthly budget and updating each line item as needed. Be sure to include an emergency fund if one isn’t already included. If you have accumulated any savings, consider speaking to an investment advisor about the best use of these funds. You may be surprised how beneficial a small investment account can be!
Plan ahead
If you’re considering a vacation or another large expense, there are several elements to consider. First, does the cost of the trip fit within your budget? Price out your flight or other travel cost as well as accommodations, entertainment, food and other expenditures. Given the current situation, it’s smart to investigate specific requirements related to your destination (some of these requirements will cost money). Secondly, are you at risk of losing income if you’re required to quarantine upon re-entry to Canada, or can you return to work immediately (or work from home)? Be sure to confirm these details during the planning phase of your trip. Then, if all is well, go ahead and book that flight to the beach!
Pace yourself
When it comes to re-entering the social scene, there’s nothing wrong with taking it slow. You may be tempted to go to all of the concerts, sporting events and activities you’ve been missing or book an epic vacation to make up for lost time, but remember that your budget exists for a reason. Prioritize, pace yourself and make an effort to stay on budget while enjoying yourself. You’ll be glad you did.
Contact us for personalized advice
Every individual and family is unique, and no two investors have the exact same needs and goals. If you’re interested in speaking to an Interior Savings advisor to get personalized financial advice that fits your life, please contact us. We’d be happy to discuss your goals and address your needs for saving, investing and planning for the future.