Keeping a bare-bones budget involves prioritizing your needs over your wants, such as being able to pay your rent/mortgage, utilities, food and other important expenses over things like entertainment and social activities.
In a roundabout way, lockdown makes that easy. But, what about life after lockdown?
A bare-bones budget is a dire straits budget with little room for treats or luxuries, and it will show you exactly how much money you’ll require to survive every month, in the event of something terrible happening, like unemployment.
It isn’t about the doom and gloom of the situation. Think about it more constructively, proactively, and use this time to develop strategies and re-evaluate your goals.
Pull out all the financial statements from the last three months, go through them with a fine-tooth comb and take note of all expenses that are essential and all that are frivolous. Be ruthless in your budgeting. If something doesn’t contribute to your survival or to your future, cut it. If anything can be downscaled, do it.
Make plans for life beyond these hard times.
When you return to the office, once all of this has passed, carry these habits with you. Create a spending plan with your spouse. Build an emergency fund. Share rides, where possible, or cycle to work if you’re close enough. Cut out the takeaway coffees or the takeaway meals or the pricey drinks. Pack your own lunch to work. Save electricity. Make your own gifts. Be savvy in your spending, look for good deals. Stop smoking.
Take good care of yourself. Appreciate what you have.