Finances: Money Saving Tips To Survive A Loss Or Reduction Of Income

Nothing is ever guaranteed in life. The income that one has today can be gone or greatly reduced tomorrow. You could lose your good job by being fired, retrenched, declared redundant or let go if the company you work for closes down.

If you have a business, it can be affected in one way or another including changes in legislation (like what happened to the gaming and gambling industry); technological changes (like what Netflix and streaming sites did to movie-selling businesses); and a poor economy (which deprives your customers of disposable income to spend on your products).

You can still have a job and/ or a business but a serious disease affecting you or a close relative can make you need more income. There are other factors that can affect one’s income including living during a pandemic, wars or post-election violence.

With this in mind, it is important for one to be prepared for any eventuality and to know how to survive if one gets to the point where their income is gone or reduced. Here is what you can do when you find yourself in such a position.

Do Not Panic

A loss of income is usually accompanied by panic. In the course of the panic, one may do things that will be counterproductive. Many people were retrenched and put all or most of the money they got into a business they knew nothing about and they had not researched well enough. A few months down the line, the business fails and the person becomes broke. Activity for its own sake is not a plan. Instead, you must calm yourself and approach these tough issues objectively and with a clear head. Finances: When You Should Use Your Emergency Fund

Minimise Expenses

It goes without saying that the less we spend, the more money we’ll have. Controlling your costs goes a long way in ensuring that the little money you have does something useful and beneficial. Spending less, however, does not mean you sacrifice essential needs.

Some of the areas you can save on include:

Housing: Housing is a basic need, meaning it is almost impossible to do without. There are a couple of ways one can save when it comes to housing including:

1. Going to live with a friend or relative if you live alone;
2. Getting a roommate with whom you will split the rent;
3. Putting up a room or an SQ on Airbnb to raise some income if you have a big house; and
4. Moving to a cheaper house.

Food: This is also a basic need that one cannot do without. You can however reduce or do away with take-outs. You can also try growing a few vegetables, especially if you have a balcony. All you need is an old bucket, some loam soil and seedlings. You should do a little research on what you want to grow and you are good to go. It could save you the few coins you need to buy tomatoes and vegetables. Checklist: Four Things You Can Grow In Your Backyard/Balcony And Everything You Need To Grow Them Successfully

Entertainment Costs: Entertainment is not a basic need so we can do without it and still live. However, the stresses of not having an income can sometimes be bearable with a little entertainment. If you can cut on most entertainment costs, that would be great.

Alternatively, you can look at cheaper ways of being entertained. You do not have to go to the theatres to catch a movie. Instead, watch a movie at home. Look at subscriptions that you hardly use, and do away with them. For example, you can decide between Netflix, Showmax and Amazon which one you need most and do away with the others.

Transport Costs: Moving from point A to B can be expensive. You can consider saving costs by not using your car and/ or avoiding cabs including online hailing ones such as Uber. Consider using public transport which is affordable. You can also consider walking rather than using a boda boda if the distance is short. This will not only save you some money but also make you healthy.

Avoid Debt

Avoiding debt is easier said than done, especially when one is in a fix. If you have to incur any debt, let it be minimal and be wary of the interest charges. Deficits always tend to drag someone into a pit that ends up being so hard to climb out of it. Avoid shylocks whose interest rates are over 20% per month. Instead, if you have to get into any debt, consider the flexibility in paying back, the interest charged, penalties for non-payment etc. Make sure you are as comfortable as possible with the plan. Finances: Borrowing In Joy But Payback In Sorrow – Why You Need To Work On Clearing Your Debts

Think of Ways of Generating an Income

After minimizing your expenses and avoiding debt, then you need to start generating an income. Here are a few ways you can generate an income:

Using Your Hobby or Talent: Your hobbies and talents can be used to generate income for you. The first step is to identify what one is good at. Sounds easy, but not many people know they are good at something. Once you identify what you are good at, you can then start thinking of how to monetize your services or expertise. Here are a few things you can do:

1. If you are good at taking pictures, you can offer photography services at your friend’s or relative’s gigs for a small fee. From there, you can get referrals for other gigs;
2. If you are good at cooking, you can also do catering services at your friend’s or relatives’ gigs for a start, and thereafter, get referrals;
3. You can also give tutorials on what you are good at in Zoom sessions. There are many people interested in learning different things including how to keep fit, music lessons, cooking classes, personal finance & money management just to mention.

Earning Money Online: There are a few ways you can earn money online. All you need is your phone (or PC) and the internet. These include:

1. Taking Online Surveys and Reviews: You can find sites that pay people to take online surveys and reviews. Most of these (like Swagbucks and Survey Junkie) are US-based.
2. Transcribing: There are a few sites that pay you to transcribe audio into text. Examples include Scribie and Quicktate.
3. Check out various freelance online jobs such as graphic design and software development jobs at online job sites like Kuhustle.
4. You can also check out Freelancer, Guru, Paydesk, Newsmodo and Upwork for other freelance online jobs depending on what you are good at.

Conclusion

It can be quite stressful if your income is disrupted in one way or another. However, this could be a good opportunity for you to explore other money-making opportunities that can prove to be better paying.

Covid 19 Has Opened Up A Financial Pandora’s Box – This Crisis Will Make People Rethink Their Investments

Dealing With ‘Black Tax’ Part 2: Building Generational Wealth To Break The Black Tax Cycle

3 Kinds Of Income And Why You Should Have All Of Them

8 Ways To Prepare For An Economic Downturn Or A Personal Financial Crisis

Understanding Financial Anxiety: Signs, Causes And Impacts

Financial Distress: Things To Consider When Downgrading Your Lifestyle Because Of An Economic Crisis Like Retrenchment Or A Recession