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We’ve all had to adapt to big lifestyle changes in the past few weeks, all because of the coronavirus pandemic that has forced many people indoors in an effort to cut down on social interaction in an effort to stop the spread of the virus.

This has left many having to work from home, or be off work for the time being, in an effort to protect the most vulnerable in society. This ‘self-isolation’ and ‘social distancing’ has been a big change, but like many culturally significant events before, we can persevere and overcome by keeping proactive and organised.

Part of this is looking after your finances, which might take a hit over the next few weeks with additional burdens and expenses becoming apparent as time goes on. We’ve put together a guide on how to look after your finances over the course of the pandemic and what you can do to protect yourself during this period of isolation.

How to protect your finances

Depending on the job or industry you have made a career in, you might be slightly or severely affected by having to isolate at home. Whatever situation you have found yourself in financially due to coronavirus, there are several things you can do to protect your finances during this trying time:

  • Plan ahead – look at the current government advice and work out what the biggest changes to your finances will be over the next few months. This will help you put a plan in place to protect yourself and your money
  • Cut back on non-essential purchases/expenses – now is the time to cut back on non-essential spending such as unused subscriptions that will save you money for the long term
  • Make a new isolation budget – these changes in your circumstances will mean changes in your budget. Create a new isolation budget so you have a monthly projection of what your most important expenses will be if you need to stay at home or are limiting your social contact. Take a look at how your expenses will change below
  • Cut down on panic-buying – as much as this is tempting to do, panic-buying can affect your finances and might even lead to you buying perishable foods you won’t have enough time to eat. Stick to a regular shopping list and maybe try to purchase frozen foods you can keep for longer so you aren’t wasting money
  • Get refunds for prepaid events or activities – whether it is a season ticket you’ve purchased to get the train to work, a holiday you can longer go on or a gig that has been cancelled, you should always try to get a refund. If you are unable to participate in a prepaid event or activity, find out the refund policy and make sure you can get as much of your money back as possible

What changes can I make now?

With many expenses increasing and decreasing, there are several actions you can take now in order to save money and reduce your monthly outgoings. They include:

  • Create a shopping list and book a food delivery
  • Get a refund on season tickets for travel
  • Start comparing energy suppliers to see if you can get a better deal
  • Make sure your broadband package gives you unlimited access or shop around for a better deal
  • Cancel any unused subscriptions
  • Ask to defer your mortgage payments if you’re unable to work
  • Check with your employer if you should receive Statutory Sick Pay if you have symptoms or are unable to work
  • If you are self-employed or run a business, find out if you can benefit from the Coronavirus Business Interruption Scheme
  • If you know when you are going back to work and can afford to make repayments every month, think about applying for a credit card or personal loan to help top up your finances.

How your expenses might change during isolation

With UK citizens now being encouraged to stay at home to stop the spread of coronavirus, it means that not only will your lifestyle change but also your finances too. Staying at home means certain expenses will go up, such as energy bills, whereas other expenses such as transport will go down.

We’ve put together a list of expenses that will inevitably change during your time staying at home. First off, areas of regular expense that will reduce while you stay at home:

  • Transport
  • Petrol
  • Eating out (Cafés, Restaurants)
  • Gym and social club memberships
  • Holidays

With social distancing in effect to stop the spread, and with a lockdown announced from 23rd March 2020, it means that we will be taking a lot less public transport. That means a saving on what you would usually spend on getting the bus, train, tram or otherwise to get to work. This also means a lot less petrol being purchased too. These major savings over the next few weeks will be very useful when you’re looking to spend more in other areas.

The money that you would usually use eating in restaurants will now go towards either takeaways or for food shopping, as many people will have no choice but to eat at home. This should also provide an overall saving as it is much cheaper to make a home cooked meal when compared to eating in a restaurant.

There will be many activities such as going to the gym or joining a social group on a regular basis that will have to be stopped for the time being. Find out if you can either pause any memberships or get a refund for the duration of you having to stay at home. The exception here is if you would still like to support an independent business with your membership fee.

Unfortunately, many countries around the world have already implemented travel bans which means that holidays booked in the next few weeks and possibly months are looking very unlikely. If you have cancelled a holiday because of this, you can also make a big saving. This can be put aside for a future holiday or be used to prop up your finances over the next few weeks.

Next, we can look at what potentially will increase:

  • Food shopping
  • Electricity
  • Gas
  • Water
  • Streaming services and rentals
  • Pharmaceutical products

With many people not being able to leave their homes, there will be no other option than to eat homecooked meals, rather than eat in restaurants or cafés. This will mean your food budget will have to be increased as you end up spending more on food at home.

Your household bills may also be affected, simply from you spending more time at home. This means increased use of electricity, gas and water. Now might be a good time to look at switching suppliers if you’re already spending a lot, or shopping around for the best prices on energy.

You may already be subscribed to streaming services, but now is a good time to take a look at what you have and if you are using these services or not. It could be that you cancel a few unused subscriptions and get a new one to watch programmes you’ve not seen before. Just make sure if you aren’t using any subscriptions that you cancel them to save money.

Finally, there could be an increase in buying products that will help if you have any symptoms of coronavirus. That means pharmaceuticals that will ease any flu-like symptoms and help you feel better at home. Make sure to leave a portion of your food budget for medications if anyone has been affected in your household.

What if I need to borrow money?

There will be many circumstances where your income will be affected over the next few weeks and possibly months, meaning that you may have to borrow money in order to pay for regular expenses.

  • Dip into savings – if you have a savings account, see how much you can afford to withdraw and if this can be used to top up your finances
  • Use a credit card to spread the cost – if you would prefer to spread the cost of additional expenses such as food shopping and other services, getting a 0% purchase credit card will mean you can make minimum monthly repayments and pay back the majority once you’re back at work. Use our moneymatcher tool to find the right one for you
  • Overdraft (but check the new guidelines) – you can always arrange an overdraft with your current account supplier but remember that guidelines are changing from April 2020 meaning that you will be charged interest instead of a daily fee. Find out more here
  • Personal Loan – you can also get a personal loan and make agreed monthly repayments, but only if you can afford them and are happy you can make future repayments. Use our moneymatcher tool to find the right one for you

Remember, this should only be done if you know you can still make future repayments and are looking to spread the cost over a number of months, keeping your personal finances intact.

What government support is available?

Several measures have already been announced to help those having to self-isolate or work from home. These measures are being changed or improved on a daily basis so it’s always worth checking for updates on the GOV.UK site to see what financial support you can benefit from. Current measures include:

  • Paying 80% of wages – if your employer has to shut down, they can apply for funding to cover 80% of your wages to keep you employed. Speak to your employer to see if this is relevant in your case
  • Statutory Sick Pay (SSP) – check if you are entitled to SSP with your employer if you aren’t working due to having symptoms of coronavirus or otherwise
  • Mortgage repayment holiday – if you are unable to work then many banks are now offering a 3-month repayment holiday. Speak to your mortgage provider if you are affected in this way
  • Coronavirus Business Interruption Loan Scheme – if you run a small business and you are now unable to work, there are certain initiatives that will allow you to take out a loan and keep the business running

Whatever your circumstances, make sure you can organise your finances and ensure you can afford the essentials during your time at home or otherwise. Good luck and stay healthy!