According to Nerdwallet, Americans had to revamp how they approach their finances over the past year as a result of higher unemployment and pay cuts. The study found that most Americans who adopted new spending habits plan to keep them long after the U.S. pulls itself out of the pandemic. These financial habits are worth keeping even as life turns back to normal.
1. SPEND LESS, SAVE MORE
For many Americans, spending less amid the pandemic came naturally because of income loss or fewer spending options after restaurants and travel largely shut down. NerdWallet’s survey found that among those who said they picked up new financial habits during the pandemic that they plan to carry into 2021, 58% said they were cutting back spending on “wants” and 36% said they were cutting back spending on “needs.”
2. STICK WITH A BUDGET
In the NerdWallet survey, 39% of those who adopted new habits that they plan to carry into 2021 said that one of those habits was sticking to a budget.
3. MINIMIZE TRAVEL EXPENSES
Among survey respondents, 40% said one of the new habits they plan to continue in 2021 was cutting back on travel spending.
4. EARN EXTRA INCOME
Based on the study, among those who developed new financial habits, just over a quarter said they picked up a side hustle or extra work to make money. Kevin Mahoney — a CFP and founder of Illumint , a financial planning firm for millennials based in Washington, D.C. — says earning a side income can help provide financial stability during uncertain times, which is why he encourages his clients to consider it.
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