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Managing Personal Finances in the Downturn

Everything that’s currently happening in the economy due to the Covid-19 pandemic is putting pressure on personal finances. It’s getting more difficult for some of us to stay afloat every day, with less or no money coming in. In this article, we share some practical ideas for how to take control of personal finances to make ends meet. 

If you've ever looked at your bank account and wondered where your money's gone, this is a sign you are not in control of your finances. 

In the boom times, that may be less of a problem, with money coming in consistently. But, when the tough times hit, you may not have any cash reserves to fall back on. 

Either way, it’s good to get into the habit of saving rather than spending. Here are a few practical ways to make ends meet. 

1. Do your budget

Whatever your situation, your budget is one of your most profitable tools, telling your money where to go. Start by printing your bank statements out and looking at where your money is going – you’ll be amazed! 

Then, do a zero-based budget, where income minus expenses equals zero. This means that every dollar received into your bank account or cash received into your hand is allocated. 
If your earnings are $1,000 a fortnight, you want everything you spend in your household such as loans, insurance, groceries and savings to add up to $1,000.  

For more info on how to create a budget click here.

2. Plan your meals

It's astounding how much we spend on food. We celebrate with food, entertain with food, reward ourselves with food. It is a large part of our lives and a large portion of our expenses.

Planning your meals means you only purchase the ingredients you need, reducing the amount of unused ingredients sitting in your cupboards. Buying online ensures you keep within your budget.  

Start your meal plan with meals based around ingredients you already have. Only ever allow 1 emergency ingredient per meal to avoid going back to the shops often and buy just enough for what you need to get you through to the next grocery shop. 

For more info on how to plan your meals click here.   

3. Sell unused household items

Look around – is there stuff in your house that you haven’t used in ages? Maybe there are kitchen appliances you haven’t touched or furniture you don’t need? Have the kids outgrown clothes or toys that still have some life in them? Round them up and sell them. 

It can be cheaper to sell on your local Facebook Market Place than TradeMe as there are no fees. Plus, for smaller items, sell them in bulk – it’s less admin and more efficient for shipping. Then for lower value items, set a low reserve (like $1 + shipping) so that they sell first time – it all adds up. 

4. Cut the luxury spending

Cut down on any unnecessary ‘luxury spending’ – things like coffees, eating out, beauty and hair and holidays. Focus on being happy with what you have and make the most of family time. Try to do free activities for fun, like homemade picnics, utilising parks and libraries, playing boardgames and reading for fun.

​5. Unsubscribe, unsubscribe, unsubscribe!

How many subscriptions do you have that you don’t really need? Areas such entertainment streaming, technology and convenience-based services like food delivery can chew up a lot of cash. Can you save on some of these areas to stop so much money going out of your account? Go back to that bank statement and have a look.

6. Access support like the KiwiSaver Hardship

If you can provide evidence that you're suffering significant financial hardship, you may be able to withdraw some of your KiwiSaver savings. Jen specialises in providing this kind of assistance and can complete forms on behalf of clients. Find out more below. 


Need help?

Jen has a range of products including the Creating Wealth Workbook, to help you manage your finances. She is also available for one-on-one coaching, to help you through this period and get them into good habits for life. If you’re interested, check out our online shop or get in touch with Jen. 

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