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Post-COVID Financial Playbook

January 13, 2022

by Flyp

Surviving 2020—and 2021— was no easy feat.

That’s true from both an emotional and financial standpoint. Not only did we deal with unprecedented levels of uncertainty, but we did so largely in isolation.

Communal gatherings were off-limits, and we had to weather the storm without most of our friends and family members by our side.

And then, finally, the clouds began to lift — restrictions were eased — and life seemingly returned to normal. A new normal. Planes peppered the skies, cars gridlocked on highways, and people populated supermarkets once again.

And yet, just as we began to take a collective sigh of relief, the financial repercussions of the pandemic rushed in. The supply chain crisis, exorbitant gas prices, and soaring inflation rates dominated headlines and drained wallets across America.

Inflation has risen at the fastest levels since 1982, and food prices are up 6.4% since 2020. Eggs alone are up 12.8%.

Energy costs, including gasoline and electricity, are also up 33% over last year. Furniture is up 11.8%, new cars are priced 11% higher, and used vehicles are 31% higher year-over-year.

In other words, everything costs more these days. And while we may have regained the freedom to be outside, to travel, and to shop, the incentive to spend money seems less appealing than ever.

In response to these discouraging economic times, we present you Flyp’s Post-COVID Financial Playbook. It’s clear, concise, and built to help you hit the ground running in 2022.

 

1. Revisit Your Budget

Come rain or shine, a budget never goes out of style.

In periods of want or plenty, it’s the guiding light for one’s financial health. While it’s easy to view a budget as a constraint on fiscal freedom, it’s designed to enable prosperity over the long term.

Does a budget mean you may have to slow down your spending, or delay gratification? It usually does.

But the benefit of a budget is this: deeply-rooted confidence and peace of mind that your financial habits today will guarantee a better tomorrow.

While Instagram influencers can try to seduce us into buying $125 t-shirts, deep down, we know spending recklessly will only set us back from achieving our goals.
Even Warren Buffett, one of the wealthiest men in the world, has a budget for his McDonald’s breakfast.

As he told HBO, “When I’m not feeling quite so prosperous, I might go with the $2.61, which is two sausage patties, and then I put them together and pour myself a Coke. $3.17 is a bacon, egg and cheese biscuit, but the market’s down this morning, so I’ll pass up the $3.17 and go with the $2.95.”

If Buffett can budget, so can you.

While there are all sorts of budgets to choose from, the best budget is the one that you can confidently repeat.

Note: Take advantage of modern apps to save money. For example, you can use Flyp’s free online budget template, download the GasBuddy app to find the cheapest gas stations in your area, or use YNAB (You Need a Budget) to get out of debt and start saving money.

 

2. Review Expenses (& Cut Costs)

Budgeting begins with a simple question: where did the money go?

This part of the process is on par with getting a root canal, but it’s important — especially in the wake of a pandemic that changed people’s spending habits.

If you can manage it, go through your credit card statements and identify your biggest spending categories. If you notice a particular habit — whether it’s exorbitant online shopping, take out , or one too many streaming services — consider curbing those expenses in the coming months.

This is your opportunity to cancel unused subscription services and to limit how many nights you go out for dinner. This is not about disrupting your ability to have fun, but it is about finding ways to save money and secure your post-COVID financial health.

So rip that financial band-aid off, look at your expenses, and the path forward will become more clear.

 

3. Pay Off Credit Card Debt

Carrying a credit card balance from month to month is quite a financial burden.

In short, it means you’re spending money on interest — rather than on the things that matter. When played out over time, making minimum payments on credit card bills robs you of your financial future, as the principal balance swells and compound interest prevents you from doing anything about it.

As we head into 2022, do whatever it takes to pay off your credit card balance.

You’ll notice we listed this item after building a budget. Why? Because to tackle credit card debt with confidence, you need a reliable budget firmly in place.

Personal finance guru Dave Ramsey recommends the “Debt Snowball” method, where you aim to pay off your smallest debts first before dealing with the bigger burdens. This approach allows you to make daily progress without getting overwhelmed by the bigger picture.

Want to learn more? Click here to explore the Debt Snowball method!

 

4. Find Your Side Hustle

Job openings are at a record high in America, with over 11 million opportunities currently on the market.

If you’re looking for additional ways to make ends meet or get ahead, now is the time to pick up an extra job (or as the cool kids call it these days, a “side hustle”).

If you’ve budgeted your year and find you don’t have much cash left aside for personal enjoyment — like a trip to the movies or a night out on the town — getting an extra gig can help provide some financial cushion.

For example, you can work for Uber (where drivers earn an average of $481/month), become an online tutor with companies like Juni Learning (and earn at least $20/hour), or put your unique skill set to work on freelancing sites like Upwork.

In our modern, digital economy, there are countless ways to make extra cash. It all starts with a simple Google search.

 

5. Invest in the Stock Market

At first glance, this tip may seem counterintuitive. After all, why should you put your money in the market when you can use it for practical needs in your daily life?

That’s a fair question, but here’s our rationale: during periods of high inflation, your cash depreciates at a rapid rate. If inflation rises 5%, for example, the value of your money also drops 5%.

Fortunately, you can potentially negate this trend by putting your money to work in the stock market. Though investing in stocks can be risky, it has historically provided protection against inflation*. According to Kiplinger, “The stock market’s average annual gain of 10% has outpaced inflation over the long run.”

If you’re in a position to do so, consider investing your money in assets that can earn returns to offset the adverse effects of inflation.

Ready to get started? Be sure to check out popular investing apps like Acorns and Robinhood to jumpstart your investing journey.\

 

Moving Forward

The road to financial freedom is exactly that: a road. It’s a journey, not a destination.

By budgeting, planning, and investing, you can take command of your money and strengthen your future.

Plus, with the Flyp debit card, you can get rewarded for your financial discipline with up to 110% cash back on purchases.

Join Flyp today and learn more!

 

Flyp is not a bank. Banking services provided by Sutton Bank, Member FDIC.

Rewards provided by Flyp. *Terms and conditions apply.

*The information provided by Flyp is for informational and educational purposes only. This advice should not be taken as professional financial advice. Please speak with a financial advisor before making any important financial decisions.