5 things to keep your money in check – What kind of pandemic spender are you?

This pandemic has changed the social habits of many.  According to Digital Commerce, there has been a 49% increase in online spending from March to April.  USPS and FedEx have reported an increase in deliveries and 58 million Americans are spending more money during the pandemic than they were pre-COVID 19.  Entertainment and alcohol lead the charge, accounting for 52% of the non-essential purchases during COVID 19 quarantine. 

So, I ask, what kind of spender are you and what is triggering your impulse purchases?

Rationalized spender:  Consumer makes decisions based upon saving money in other places.  Replacement of one cost for another.  “These stores are having an online sale, so since I am not spending money on going out, I can afford to buy this.”  Or the bigger rationalizations, “Well, we are not spending money on going on vacation so we should buy a pool!”

Comfort Spender: Buys to make them feel better.  A coping method for dealing with stress or discomfort. Buys because of a feeling that they deserve it for being in quarantine. Online shopping for things one may not need or necessarily budgeted for pre-quarantine.  Gives the purchaser a temporary feeling of happiness.

Revenge Spender: Makes decisions of going bigger versus their spouse.  “Well, you bought this, so I am going to buy that”. Avoiding this may not only build your wealth, but may save your relationship!

Smart Spender:  Purchases what they need to get through the pandemic, but with building their wealth as part of the equation.  The key difference is that this shopper uses their existing budget to manage the household and purchase discretionary items AFTER putting away additional savings to take advantage of buffering their savings.

So, when considering your purchases, here are 5 things you should do to build on your financial position:

  1. Good time to go through the numbers – If you do not already have a budget, this is a good time to go through the numbers. You will have a clear example of what is going out of the house for your needs versus wants.  Understanding what your needs are will give you a new perspective on how much discretionary spending you really do.
  2. ½ of savings go to savings – Now that you understand your needs versus wants, take half of what you are “saving” from being quarantined and start to pad your savings. We are not out of the clear yet and having more savings can only be a good thing.  Studies show that seeing your savings account grow can release the same kind of “high” as spending does.  This is a good time to get your spending and savings in check.  Build wealth!
  3. Prioritize your needs and wants- There are some things you will mentally and emotionally need to get through down time of restricted travel and socialization. When you make purchases, think about which category you are in when you make that purchase.  See if it fits in your NEW budget.
  4. Use your new savings to get on top of old debt – If you are carrying debt that needs to be repaid, you should adjust your savings technique. Instead of buffering your savings, use that money to pay down credit cards or other “bad debt” that you have accumulated.  Meaning that it makes sense to pay down credit cards, however, it may not make sense to pay down your mortgage.
  5. Put the money in an account that is not so easily accessed – Out of sight out of mind. Even if you move it from your checking to your savings account, that is a win.  The easier the money is to access, the more likely a consumer is to spend it.


If you are unsure of what to do with your new savings or your current strategy is not working, contact Green Ridge Wealth Planning today.  We can help you to determine how this increased savings will impact your future and give you ideas on how to invest these savings to attain your future goals.

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