It may be hard to imagine what the next few months will look like, whether it’s an unexpected event. But there’s no need to panic—most of the time all you need to do is evaluate your priorities. If your financial situation has changed, you just need to make some updates to account for your new reality. Are you someone who finds talking about money stressful? Taking the time to understand how much you earn and spend can actually be a reassuring, plus it helps you feel more in control. And that will help to reduce your stress. Let’s go through the basics together.
1. Figure out your income
If you want to know how much you can spend, you have to know how much you earn. What are your sources of income right now? We’re talking about your pay, as well as any other money you have coming in. To make sure you’re not leaving anything out of the equation, use our tool to make your budget.
Remember that the CERB or CESB income is taxable! Avoiding a nasty surprise is as easy as setting money aside in a savings account for your taxes.
2. Get a handle on your spending
Write up a list of all (seriously, we mean all) of your expenses. What are your fixed costs (the ones you have every month like rent, electricity, Internet) and your variable costs (groceries, clothes, activities)? Are you saving for a big project like studying abroad or buying a car? Do you have any debt to pay back (credit card, line of credit)? If you’re spending more than you’re bringing in, you might need to change some of your habits. You could go through your list of subscriptions or start thinking twice before making a purchase. There are tons of solutions out there! Here’s an article with all kinds of ideas for optimizing your budget.
3. Set some money aside
If you’re in a position to do so, keep up (or set up!) your good savings habits. By setting money aside, you’ll be gradually building yourself a safety net that can help you when the unexpected—like a job loss—hits. Consider setting up automatic transfers to your savings account. Every single dollar counts! You’ll see, it relieves some financial stress and helps keep you focused on your goals, no matter the circumstances.
Desjardins is here for you
Our advisors are always available to answer your questions and help you draw up a budget that meets your needs.