As the coronavirus pandemic makes its way into yet another season, the “trickle down” impact on Americans’ financial situation and spending behavior continues to evolve. Record-level unemployment, business shut downs, and economic uncertainty are certainly driving indicators of consumer spending. A recent survey from a nonprofit organization, polled adults about how the coronavirus has impacted their finances and financial behavior*.
The study found that 67% of feel that the pandemic has served as a “wake-up call” for their current financial status. If you’re in this percentage of people who feel this may be a good time to review your financial roadmap, consider setting aside some time to assess your short and long-term goals. It’s a good idea to review the last few months of bank statements to assess where your money generally goes each month. On firstbanks.com, simply login to your account, go to “Accounts” and then to “Statements” to downloaded your most recent statements. Did you find there’s room for a reduction in spending to free up extra money for things like contributing to retirement, saving for a new home, or beefing up your savings?
The survey also found that more than 45% of average Americans are now working on building an emergency savings fund. Many experts have long recommended that families have three to six months of living expenses saved in a safe, secure account for the unexpected, such as a job loss or large, unexpected expense. Keep in mind, this would be to cover essential items like mortgage or rent, groceries, utilities, gas, insurance, and cell phone. As families prepare for the unknown and the uncertainty of what’s on the horizon, many people are considering the best approach for their finances.
“As a bank for families and family-owned businesses,” commented Angie Moleski, Product Management Officer for First Bank, “we realize the importance of having a short and long-term savings strategy. That’s why we introduced Plinqit, an online savings solution brought to you by First Bank. This digital tool allows families to automatically allocate money toward their various savings’ goals, such as building an emergency fund or saving for the future. It’s a ‘set it and forget it’ savings solution.”
Read more about using Plinqit to help you meet your savings goals.
As part of the HEALS Act that’s still in the proposal stage (at time of publication), eligible Americans could potentially receive a second stimulus check. You may also be anticipating a tax refund if you filed in July with this year’s extended tax deadline. If you’ve found yourself in between jobs as a result of the pandemic, using any potential stimulus money or tax refund for living expenses is certainly expected. However, if you’re still employed, it may be worth considering putting all or a portion of any extra money into building up your emergency savings fund. If you’ve already established an emergency fund, you may want to use it to pay down high-interest debt or put toward your long-term savings goals, such as a Certificate of Deposit (CD) or a high-yield savings account that’s FDIC-insured.
Read What are some of the Best Ways to Spend the Stimulus Money from the first round of stimulus payments.
If you’d like to use this time to evaluate your finances and where you’re at in your financial journey, schedule an appointment with a knowledgeable First Bank trusted advisor. We can help you find the right short or long-term savings solution that’s right for you.
* Life Happens. These results were taken from a random double-opt in survey of 2,000 Americans conducted by OnePoll and commissioned by Life Happens between May 29, 2020 and June 3, 2020. OnePoll is a corporate member of the AAPOR and adheres to the AAPOR Code of Professional Ethics and Practice.