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The coronavirus pandemic is pushing many Aussies into financial stress. Job cuts, reduced hours and business closures have affected the take-home pay of millions of Aussies, with a full return to normal still a long way off.
If you’re struggling at the moment or you just want to batten down the hatches, below are eight simple ways to shape up your finances during this time.
Review your spending habits
This is always a worthwhile habit, but it’s especially important with the economy on the edge of a recession. Although you’re probably spending less overall during lockdown, make sure you aren’t overspending on things like food delivery or online shopping.
It’s also worth cutting back on any subscriptions you aren’t using at the moment, like your gym membership or multiple streaming services.
Maximise your savings
If you already have a decent-sized emergency fund, put your extra savings to good use. Savings interest rates may be low, but a small amount of interest is still better than nothing. Alternatively, you might want to consider investing in shares if you are after larger returns and can afford to take on a bit more risk.
Pay off your debts
If you’re paying off multiple loans, any extra savings should be funnelled towards paying off these debts. Make sure you prioritise urgent, high-interest debts like your credit card over lower interest debts like a home loan or HECS loan.
Refinance your mortgage
When was the last time you checked your mortgage interest rate? Variable rates as low as 2.39% are currently available – this is an excellent opportunity to pay off your loan quicker. Even a small difference to your interest rate can save you $100 or more each month on your repayments. This can end up shaving thousands of dollars off your payable interest over the life of your loan.
Negotiate with your landlord
Struggling to pay your rent? Some relief is available in the form of a six-month moratorium on evictions. This means landlords are unable to evict tenants during this time if you’re struggling to make your rental payments. Keep in mind that you’ll still need to repay any missed rent at a later date.
If your income has been affected during the pandemic, it’s worth trying to negotiate a lower weekly amount with your landlord if possible.
Review your financial products
Your energy, internet, phone and insurance bills come with a hefty price tag. Although these costs are largely unavoidable, you may be able to find a cheaper deal than what you’re currently paying.
For instance when it comes to your power bill, energy providers will often have lower offers for new customers. This can be a good incentive to look for policies that match your usage patterns, allowing you to switch and save.
Pick up a side hustle
There are countless ways to make some extra cash on the side. Sell items you don’t need on sites like Gumtree or eBay, take up freelancing jobs online, drive or deliver food or rent out a spare space in your home. It pays to think outside the box.
Get financial help if you need it
These are unprecedented times and sometimes no amount of savings tips can get you out of trouble. If you’re struggling to stay afloat, banks, lenders and providers have hardship assistance schemes in place to help you navigate the situation. This may include measures like a temporary deferral or reduced repayments.
Bessie Hassan is a money expert at Finder