With around 50 percent of the total population fully vaccinated, the country has started to recover from the slump it experienced when the pandemic started. The economic recovery comes as the number of cases surged due to the delta variant of the virus. Even with this, people can focus on rebuilding their finances and get back on their feet.
If you are among those affected by the pandemic when it started over a year ago, you can look forward to a better salary as the demand for workers increases. At this point, you can get back on track by focusing on several aspects of your finances.
Work on Emergency Savings
You need to work on your emergency savings, especially if you used them at the height of the pandemic. The health crisis caught businesses flatfooted, which resulted in numerous closures as people stayed home to avoid catching the virus. Many people also lost their jobs and forced them to dip into their savings.
With a better economy, people can start rebuilding their emergency savings. The rule of thumb was to have enough funds to last at around three to six months. But the ongoing pandemic might compel people to rethink this goal. People have to set aside a larger amount to have something to rely on when something similar to the current pandemic happens in the future.
If you plan on working on your emergency savings, you may also want to increase it just in case something similar happens in the future. The amount you should set aside depends on your family and personal needs. Your industry and career will also play a factor in how much you should save. But you can start with saving funds that can last you at least six months.
Revise Financial Goals
At this point, you may also want to evaluate your long-term financial goals. The pandemic saw millions of people setting aside their goals as they tried to make ends meet after losing their jobs. The US federal assistance allowed many people to keep their heads above water. But they had to set aside some of their plans until they got back on their feet.
If you experienced something similar, you could focus on earning rather than waiting for the next unemployment check to arrive. With many jobs available, you can look for one that is suitable for your skills and pays the salary you are looking for. You should also keep your options open since many opportunities are available as the economy continues to recover.
You can also consider signing up with a 100%-commission real estate brokerage is another option since it allows you to earn more when selling real estate. In this arrangement, you receive the entire commission. You only have to pay a transaction fee to the brokerage instead of a percentage of the commission. This is a good source of income if you love sales and can easily get along with other people.
Adjust the Budget to the New Normal Situation
As you work on your emergency savings and revise your financial goals, you should also adjust your budget and consider the current situation. The current situation is not the same as the time before the pandemic. You may have a different job, or you might have even started a business. You may have also started a side hustle that allowed you to get another source of income.
You should take these factors into account when creating your budget. Aside from the sources of income, you should also consider the other expenses related to the situation. For instance, you may need to increase your budget for hand sanitizers and health-related items. The recent increase in cases can also play a factor in your budget. You should take this into account when you set your budget.
Another factor to consider is inflation. When inflation goes up, the cost of products will also increase. So, you should take this into account when working on your budget.
Work on Reducing Debt
You may have also incurred debt during the pandemic, especially if you started a business and needed funds to launch it. You should work on reducing your debt as much as you can. This is particularly true if you have high-interest debts. You can focus on these debts and work on eliminating them before working on your other loans. At this point, you can use any stimulus checks that you receive to pay off part of your debt.
Even though the pandemic is not yet over, people should start working on their finances so that they can get back on their feet as the economy recovers.