WICHITA, Kan. (KWCH) – In the last two years of the pandemic, the financial dynamics of many people have changed. For some, it provided the opportunity to increase savings, while others faced more difficult times.
One thing that continues after those almost two years is the uncertainty.
Meritrust Credit Union Director of Financial Wellness Chris Wolgamott said, “I think what a lot of people have seen in the last couple of years is that none of us have a crystal ball. It’s really hard to plan.”
Wolgamott suggests starting with the basics when looking at your finances. Often the first step is to address stress.
He said: “With everything that has happened, there also comes some stress with your finances.
Wolgamott also said to be mindful of where your money is going.
As this pandemic has been ongoing, things have changed.
“Receiving stimulus checks was a great way for people to save money.” Wolgamott said: “Now, we’ve been in the pandemic for a while, and savings are running a little bit dry, so people are becoming more aware of what they spend each month and spending a little bit differently than they do. make. I used to do it.”
If spending on credit has become the primary way to make ends meet, Wolgamott said getting over it is essential.
“If you’ve accumulated debt, it’s really important that you first of all know how much you’ve accumulated and who you owe.” Wolgamott said, “Knowledge is power, so write down who you owe money to, how much money you owe them, then you can really start formulating a plan to address that. Some experts say start with the minimum balance you owe and work your way up. Others say start with the highest interest rate first, but the most important thing is to have a plan for how you will approach that. If you’re still struggling, contact those financial institutions and let them know you’re struggling too.”
With the rapid swings of the pendulum of people looking for new jobs, shortages on store shelves and COVID-19 continue to affect many industries, Wolgamott said preparing for those changes is a must to have a solid savings foundation.
Wolgamott said: “As the uncertainty continues, it is very important, first of all, budget first. Knowledge is power. So knowing what your budget is and if you can continue to save, you can’t save too much money right now.”
A survey conducted by Lincoln Financial Group late last year suggests that some of the changes in personal finance brought about by the pandemic could be long-lasting.
Its recent Consumer Sentiment Tracker shows that nearly 60 percent of Americans surveyed are making or plan to make permanent changes to the way they spend. More attention is paid to long-term financial goals, such as saving for emergencies, retirement, and inflation.
For December 2021, the US Bureau of Labor Statistics said consumer prices were up 7 percent from 12 months ago.
Wolgamott said that with those increases in items that people buy on a regular basis, you need to add that increase to your budget to prepare.
Said Wolgamott: “We haven’t seen anything that suggests it’s going to slow down in the near future, so it’s very important that when you plan that budget, you give yourself a little more room to take care of some of those expenses.”
At the same time, household spending is expected to maintain the growth it experienced in 2021.
The Federal Reserve Bank of New York Household Survey shows an expected increase of 4.6 percent over the next 12 months. Food and transport with the highest growth.
Wolgamott said it’s a good idea to have emergency savings to cover up to three months of expenses.
“If you want to do some extra spending, make sure you have enough money in your emergency account and don’t spend too much.” He said: “Have at least three months of expenses in that emergency account if you can, and then if you’re past that point, you can spend a little bit of money. You want to pay attention to what you have in there and make sure you continue to fund that emergency account for probably the next six months to a year.”
He added that if you have problems communicating with your financial institution.
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