I wonder if, years from now, COVID-19 will have a chapter titled in history books as an “unusual and unprecedented time.” Who else is tired of hearing that phrase?
In all seriousness, COVID-19 is scary and terrible and my heart goes out to all who have lost their job or otherwise struggled.
A disclaimer: I know that COVID-19 has caused the loss of jobs and economic instability for many. I know that I have experience the privilege and luxury of being able to keep my job during this time. Many have lost their jobs and may not have the opportunity to save money right now. While this article discusses some extra savings opportunities I have personally experienced during COVID-19, this article is also meant as a reflection for past and future opportunities you may have for extra savings (even if you can’t save right now).
One interesting side effect (benefit?) of the shut downs is how much less I have spent. No money spent on eating out, gas for my car, clothes, or haircuts (it literally shows—I think my last haircut was more than 6 months ago).
And since I moved back in with my parents until I find a house, my costs have been pretty dang low the last few months. In fact, I spent $500 less in April than usual.
Check out my spending trend from Personal Capital:
Or these screenshots I sent my mom & sister:
The effect of COVID-19 on exercise
The worst part of the shut downs was the gyms shutting down. I mean, who wants to work out at home? Or outside??
I recently read an article that reported a 32% decrease in physical activity following the social-distancing restrictions. It also stressed that physical activity has a positive impact on mental health, which is especially important to pay attention to while living inside in isolation and in fear of a pandemic. That’s exactly why I made sure to keep up my exercise habits (and because I really don’t want to gain back the 10 pounds it took me 6 months to lose).
I usually pay $67 per month for my gym membership (I know, it’s one of my splurge items). When the gym shut down, they gave members 3 options:
- Receive 100% credit for the days closed
- Receive 150% credit for personal training and other in-club services
- Pay dues as normal (yeah, RIGHT)
I’ve since started running outside, and on the treadmill. I am grateful every day that the weather has been generally nice outside for running and walking. Will I go back to my gym membership after they reopen, you might ask? Maybe. I enjoy the weight lifting and extra equipment they provide. And it’s especially useful when the weather is not great outside (and in Kansas, it’s usually either bitterly cold or sweltering hot).
AND my price is locked in at $67 per month FOREVER unless I were to quit and rejoin (yes, I specifically asked them about forever, and yes, the sales manager gave me a weird look). One benefit I’ve found is that paying that $67 a month really motivates me to work out at least 5-6 days a week to get my money’s worth. Paying $67 a month for a lifetime of health and a longer life is worth it to me. It’s a spending habit that’s in line with my values.
Gym membership savings during the shut down
I chose option 1 from the choices my gym gave. I wasn’t charged the $67 for the month of May (and I expect to receive April and part of March back). I closely budget and allocate my spending, and I specifically chose to put the extra $67 in savings instead of spending it elsewhere. Even though it’s money I wouldn’t normally have, so I could spend it without affecting my budget, I made a conscious choice to transfer the extra money to my high-interest savings account.
The same goes for the extra hundreds of dollars I have saved instead of spent these past months. I could have done same crazy online shopping, but I didn’t. I kept my habits and lifestyle the same, and transferred the extra to my savings account.
I did receive some money from the government from the stimulus checks, which I used to buy some needed home office equipment (since I’m working from home more). The rest I put in savings.
I’m not sharing this to brag or pat myself on the back. I have two points to make. First, don’t increase your level of spending with extra income, which is what many call “lifestyle inflation.” When people get raises, they tend to increase their lifestyle proportionally so that they aren’t saving any more than before. This is why people making $200,000 a year can still have a $0 (or less) net worth. Even though my income in this situation didn’t increase, it’s a similar concept because I essentially got a “raise” of $67 this month, and I chose to save it instead of spend it.
My second point is this: when you choose not to spend your money, you are not depriving yourself. You are spending on your future self. You can spend your money today for short-lived immediate gratification, or you can shave down the timeline to enjoying financial freedom for the rest of your life. Your future self will thank you, because $67 invested turns into almost $700 in 30 years. This may not seem like a lot, but these habits compound. Save an extra $67 every month, and you have $100,000 in 30 years just from that $67 a month.
Identify opportunities to save
While COVID-19 presents a very UNUSUAL AND UNPRECENDENTED savings opportunity, smaller savings opportunities likely come up every month.
Maybe one month you drive less, and spend $50 less on gas than usual. Maybe you get a security deposit back, or a tax refund. Maybe your friends are out of town and you spend less going out one month. Or you get a $100 bonus at work.
My challenge to you is to save that money, instead of “treating yourself” to an additional shopping spree or meal out. Treat your future self instead, and your future self will thank you!
What are some examples of other times you’ve experience unexpected savings or income increases? What did you do with the money? Share in the comments below!