It's no secret that we're living in a tough economy. With businesses failing and jobs being lost due to COVID-19, it's important now more than ever to implement smart spending strategies in your day-to-day life. Applying these small changes will not only save you money, but will also instill long-term financial habits that'll have you more than prepared for the next pandemic, emergency or natural disaster.

  1. Create (or revisit) your monthly budget - Establishing a monthly budget is an easy way to ensure that you're not overspending or living above your means. Additionally, mapping out all of your expenditures will help you determine which items or services are a necessity, recognize areas you can cut back on, and ultimately allocate more of your income toward savings, paying down debt, or building up your emergency fund.
  2. Track your spending - In addition to creating a monthly budget, tracking your day-to-day spending is a great way to monitor where your money is actually going, so that you can easily recognize and downsize on expenses that are considered discretionary. Becoming more aware of your spending patterns will make it much easier to eliminate those nonessential expenditures like dining out or online shopping.
  3. Diversify your income - With Americans' confidence in their job security at an all-time low, it's never a bad idea to have multiple streams of income to fall back on in case of an emergency. However, this doesn't necessarily mean you have to take up a second job. A few creative ways to bring in a little extra income could include monetizing your skills or hobbies, investing in the stock market┬╣ or real estate, using a high-interest savings account, or simply negotiating down your monthly expenses (like your phone or internet bill).
  4. Pay down debt - Accumulating debt in the midst of a recession will only add to your financial burden. Once you've determined a monthly budget and tracked your reduced expenses, it's important to put those additional savings toward paying down any outstanding debt. Eliminating those high-interest obligations will not only create breathing room in your budget, but also put you in a position to be better prepared for whatever unexpected event life may throw at you next.
  5. Build up your emergency fund - On top of paying down debt, setting up an emergency fund is crucial when it comes to preparing for (or living through) a recession. If possible, save up to 3-6 months' worth of household expenses that can act as a safety net in case of a crisis. Not only will this keep you afloat until you're ready to get back on your feet, it will also prevent you from accumulating more debt - therefore lessening the weight of financial burden in the long run.
  6. Focus on the big picture - The future is still uncertain. Don't put all of your focus on the short-term economic downturn and act irrationally when it comes to your finances (like pulling out of the stock market or building up credit card debt). Instead, keep in mind that recessions eventually pass, and develop a financial plan that incorporates smart spending and saving strategies that will set you up for long-term success.

Most importantly, remember to stay calm. We're in this together, and there are resources available to those who are struggling. North Dallas Bank & Trust Co.'s dedicated wealth management professionals are here to help you develop an actionable plan that will lead you to a more secure financial future in a post-pandemic world. Call 972-716-7100 to consult one of our experts today, or visit www.ndbt.com for more information.

┬╣Some investments and products: Are NOT Deposits, Are NOT Bank Guaranteed, Are NOT FDIC Insured, Are NOT insured by any Federal Government Agency, May LOSE Value.