Budget Benefits of the Pandemic
Image Source: Webmd
The pandemic has been a long and drawn-out period of loss, devastation, and stress for many: millions infected, nearly half a million dead, and thousands of individuals and entire businesses out of work. Nearly 1 in 5 restaurants have permanently shut down due to the pandemic. Add to that the stress of childcare and losing other critical services that parents rely on to juggle work, family, and personal life, the pandemic has radically changed the business and labor force. The full 100% of a 140K job loss in December 2020 came from women.
The pandemic also accelerating remote work for the masses, potentially changing the cultural landscape of office norms forever into the future. I was someone who benefited from this change: I accepted a new job last summer with a role based in another state and city, started remotely, and continue to do so from my home city. Even after the world returns to "normal," I enjoy remote work so much that I will likely ask my company if I can go remote full-time, and I think they will say yes.
The pandemic has ironically also helped me budget for the year, mostly by eliminating options. Here are a list of things and experiences I would typically spend money on, but am unable to do so:
Annual saved expenses due to pandemic:
$X,000 on international vacation
$X,000 on domestic vacation
$X,000 on dining out, bars, etc.
$X,000 on throwing parties at home or attending home parties (including food, wine, etc.)
$X00 on movie theaters, plays, and live entertainment
$X00 on clothes (okay, maybe $1,XXX)
Look, that's a lot of money. And yes, I do miss traveling, socializing, and all the rest. And yes, I could technically afford to live that lifestyle, however, it would eat into my current savings rate, taking me further from my financial independence goals. Prior to the pandemic, moderate changes to my savings rate for the sake of socialization wouldn't have bothered me much. Now that I am saving at my current rate, I don't know how I would feel about it once I am vaccinated and the world opens back up. For example, my boyfriend and I have talked about how we both miss entertaining, and we will likely spend a few hundred a month simply throwing parties.
Looking into 2021, however, I anticipate that the pandemic will take us through year end. This ironically also gives me a lot of certainty over my budget, because unexpected social events like after-work happy hour or dining out are unlikely to happen. Nearly all of my expenses are under my control: how much I spend on food, shopping, etc.
So, I'm going to roll with it! There is no better time to get my budget and spending under control than when many of life's temptations are simply not accessible. This is the year when I will learn what it is like to save at least 40% of my earned income, and I am honestly excited to experience it!