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Important Lessons To Learn From The Coronavirus Pandemic

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I grew up watching my grandma wash used plastic baggies and tin foil so that she could use them again.  She didn’t see the point of using them once and throwing them away. 

She lived through the Great Depression, and the lessons she learned during that time stuck with her for the rest of her life. 

Likewise, for our generation, there are important lessons people may learn from the coronavirus outbreak and the subsequent shelter-in-place orders.

lessons to learn from coronavirus

Important Things To Learn From The Coronavirus Pandemic

While not everyone will reach the same conclusion, there are likely many people who will learn these lessons during this difficult time in our nation’s history.

A $1000 Emergency Fund Is Not Enough

Many popular personal finance gurus suggest people should save a $1,000 emergency fund and then focusing all of their attention and money on paying down debt.  After the debt is paid down, then people should save a three to six-month emergency fund.

However, as layoffs and furloughs continue throughout the country, more and more people realize that $1,000 is much too small for an emergency fund.  After all, we’ve been in this tense situation for five weeks now, and there isn’t a real end in sight. 

For a family that has $4,000 in monthly expenses, a $1,000 emergency fund is only a one-week emergency fund!!  While better than nothing, in this type of situation, more money in the bank is reassuring.

Being Debt Free Is So Important

Having said that most people realize a larger emergency fund is important, they are also likely realizing it is just as important to live within their means and pay down debt.  Each person needs to decide on their own how they will conquer debt while building a larger emergency fund.  However, doing both should be a priority. 

There’s really no point in waiting to build a larger emergency fund if you have debt because, as we see now, life won’t wait.  There will always be emergencies, and we need to be prepared for them, with money in the bank, so we don’t go into debt again.

Buying Local Helps Everyone

Too many of us are dependent on the international food supply chain. As we shut our borders and as meat processing plants around the country close down, getting food isn’t as easy as it used to be.

This is a good time to recognize that the way our grandparents used to buy food—direct from the farmer—might be the better option.  We’re guaranteed a local food source, and we help the farmer stay in business.

Many people also wisely have a renewed interest in gardening and growing their own food.  After all, besides supplies, gardening is a free source of food.

There Is Wisdom In Having Food Storage

Speaking of food, there is wisdom in having plentiful food storage.  I am definitely guilty of not having enough food storage.  I regularly keep enough food in the house for one to two weeks.  Since we live in an area not prone to natural disasters, I figured that I didn’t need more.  Our power rarely goes out.  I felt safe. Until this year.

Now, I plan to keep at least a month’s worth of food in my pantry and freezer, or maybe six weeks’ worth.  As we’ve learned, you never know what will come.

Likewise, I would frequently let my toilet paper supply get down to the last roll and my cleaning supplies run out before I would buy more.  I can tell you, that will never happen again.

Final Thoughts

Our generation has never experienced an event as life-changing as the coronavirus.  As a result, there are important lessons people may learn from the coronavirus that will change the way they live for the rest of their lives.  Luckily, most of these changes are for the better.

How has the coronavirus outbreak changed your behavior and habits?

How To Handle Your Finances When You Lack Shared Goals

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Roger has his heart set on taking his children to Disney. 

When he was young, his family went to Disney every couple of years, and he remembers really enjoying the vacations. 

He is the budgeter in the family, and he’s scrimping and saving for the trip dollar by dollar. He’s frustrated, however, because his wife, Sheila, keeps spending money that could be saved for Disney. 

Just last week she bought the kids new outfits that Roger feels they didn’t need. She spent $110, and Roger is angry because that money could have gone to the Disney fund. 

finances when you lack shared goals

While Roger and Sheila are generally happily married, this issue is causing strife in their marriage.

How To Handle Your Finances When You Lack Shared Goals

While some may look at Roger and Sheila’s current difficulties as a financial issue, or even worse, a deeply seated relationship issue, there may be a simpler explanation. 

They simply don’t share the same financial goals.  

With clear communication and compromise, they can resolve this issue. 

If you find yourself in a similar situation, there are several steps you can take.

Decide If The Goal Is A Priority To Both People

Before you do anything, communicate clearly and see if a goal is a goal for both parties. 

In the above example, Sheila just does not care about a trip to Disney. She thinks it’s ridiculous to pay thousands of dollars for a trip to Disney. If she’s going to go on a vacation, there are many, many other places she’d like to go rather than a packed, hot amusement park. 

If The Goal Isn’t A Priority For Both People

If the goal isn’t a priority for both people, you can decide on a separate plan of action to resolve the conflict.

Save For The Goal Yourself

You could save for the goal yourself, without your spouse. This would definitely take longer, but it will likely reduce arguments. 

In the end, this is what Roger decided to do since Disney is so important to him. Roger will continue to save all of the extra money he has to go toward the Disney trip, and Sheila will use her spend money in a way that she sees fit.   Roger’s disappointed that it will take longer, but he understands Sheila’s point of view.

Alternate Goals

Another idea is to alternate goals. 

In this example, Sheila would get on board with saving and going to Disney.  After the Disney vacation, Roger would agree that the family will go on the ski trip Sheila has wanted to take the kids on.

If you and your spouse can compromise and agree, you’ll reach your financial goals much faster than if you saved separately.

Allow Room For Independent Goals

Just because you’re sharing finances doesn’t mean you have to always share goals.

For instance, my husband loves to go to the mountains because he was raised in a mountainous area. I’m scared of heights, so I find going up and down mountains terrifying.

Still, I recognize that my husband works hard for our family and rarely spends money on himself. Therefore, we do occasionally make trips to the mountains that he enjoys. I’m just along for the ride. 

While there are many other things I would like to do with our money, I recognize his individual interests.

Compromise and Communication Are Key

Compromising on goals and money can be difficult, but it doesn’t have to be, especially if you have open lines of communication. 

Some couples get around this problem by jointly paying for bills and having separate accounts to do with what they wish individually. However, you don’t have to go that route. It is possible to have joint finances and negotiate large savings goals.

How do you and your spouse handle disagreements in savings goals?

10 Ways To Save Money When You’re On A Tight Budget

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The economy was in a tailspin a few years ago, and although things have improved, many people are finding themselves either unemployed or underemployed.

We all need to make sacrifices at times in order to make ends meet – but sometimes it can be hard to come up with new ways to save.

Today I thought I would try and list a bunch of ways to save that my family uses, and hopefully a few of them will be ideas that you hadn't thought of before.

10 Easy Ways To Save Money

Here are 10 ways that our family is saving.

Have your own ways to save? tell us in the comments.

  1. Stop paying for cable or satellite TV:  Stopping your subscription TV service can save a ton of money on a regular monthly basis.   On average when we've been paying for service the bill can run anywhere from $35-$125/month.    Over an entire year canceling  your TV service can save you  $420-$1500!  Instead of paying for cable try watch TV shows for free using a software like Playon, or by hooking up  your computer to the TV.  Check out my article “How To Watch TV For Free Or Cheap Without Paying For Cable ”  for a detailed look at this option.
  2. Make it a point to shop for better rates on insurance:  One place that a lot of people overpay is when it comes to insurance.  Take a day off from work and shop your homeowners, auto, health, life and other insurance coverages to see if you can find a better rate. The last time I did this I ended up saving over $1000 a year on my rates!
  3. Use subscription services? Cancel them and use a cheaper alternative:   Are you paying $15 a month to pay for a subscription movie rental service like Netflix – but only rarely watch movies?  Cancel the subscription and use a cheaper alternative like the Redbox movie rental kiosks.  Paying for several magazine subscriptions?  Read the magazines at your local library instead!
  4. Realize that you don't need to buy new:  When buying things that you need, realize that you don't always need to buy those things new when used can be bought for a much smaller price. Save$5-6 grand by buying a used car, or save hundreds by buying a used version of last year's model of digital camera.    Buy used clothing, books,  electronics or other high ticket purchases.
  5. Eat out less often:  It can be extremely easy to justify spending when it comes to eating out.  We did it at our house until we actually kept a budget and realized we were overspending by hundreds of dollars every month just because we were eating out.  Packing lunches and making dinner at night meant we saved in excess of 2-300 dollars a month!
  6. Save on entertainment at the movies:  My wife and I love going to the movies, but nowadays you almost have to take out a second mortgage in order to afford the movies.   But there are ways to save on going to the cinema.  You can go to a matinee, see the movie at a second run theater, buy packages of tickets at a reduced rate, bring your own snacks (if they allow it), seek out free family movie days in the summer or join movie watcher loyalty clubs.
  7. Maintenance saves money: By maintaining the things you own you'll end up spending a little up front, and saving a ton down the line.  Go for regular oil changes and service checks, and do regular maintenance around the house in order to ensure that all of your things are in good working order.
  8. Sleep on it: A lot of people like to buy things on impulse and the result is they overspend on a ton of things they end up realizing they don't need. Give yourself a waiting period for purchases over a certain dollar amount, and quite often you'll realize while you're waiting that you don't want or need the item.  My waiting period?  At least 24 hours, but more depending on the cost of the item.
  9. Make a list – and use coupons: One of the biggest things that I don't do when grocery shopping sometimes is actually making a list of the items we need to buy. The result is that we end up buying a bunch of junk food or other items that aren't needed.  Instead, make sure to shop when you're not hungry, make a list – and actually clip some of the coupons you see in the paper to save some extra cash.
  10. It never hurts to ask for a discount:  There are so many times that you can save big just by asking for a discount.   For example, we recently called up our internet service provider and asked them to reduce our rate in order to keep us as a customer. They found a promotion that was currently running, and applied it to our account to save us $15/month.   Another big one we’ve used is to ask for a discount on medical bills.  Often if you call up the hospital billing department you can save 10-20% off of your bill just by asking, and paying cash.   This can end up saving you hundreds or thousands of dollars!

So there are 10 easy ways to save money on your regular and not so regular bills. 

Get creative, don't accept the status-quo and look for savings in places you maybe didn't even think to look before.

Where do you find savings in  your budget? Tell us some creative ways that you save money every month!

What If I Die? Steps To Help Your Spouse Take Over The Budget

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To have both partners in a marriage actively budget their expenses together is rare.

Instead, one spouse is usually the one who handles the budget and the finances. If the budgeter is lucky, his or her spouse will sit down once a month and listen and discuss the current state of finances. 

If the budgeter isn’t so lucky, the spouse will not even sit down to listen to the budget but instead leave the finances completely in the budgeter’s hands.

steps to take so spouse can do the budget

In Kate and Charlie’s marriage, Charlie completely handled the finances.  When Charlie had a stroke and was hospitalized and in rehab for three months, Kate had no idea what bills needed to be paid or even how to get into their accounts electronically.

Unfortunately, this scenario is all too common.

If you’re the budgeter, you should take these steps so if anything happens to you and you become incapacitated or pass away, your spouse will be able to figure out when to pay bills and how to log into electronic accounts.

Make Note Of When Bills Are Due

The first step is to find a way to let your partner know when bills are due.  I’m the budgeter in our family, and I use You Need a Budget (YNAB).  For each bill’s line, I’ve included the amount due and the date the bill is due. 

If you don’t use an electronic budget system, you can simply make a generic calendar and list the name of each bill on the day it’s due and the amount you must pay.

Create A List Of Debts

Next, create a list of debts for your spouse.  You should include the following:

  • Name of the company
  • Credit limit
  • Current balance
  • Minimum monthly payment
  • How to pay the bill
  • List of websites & passwords (more below)

Create A List Of Websites And Passwords

Perhaps the most important piece of information is the list of websites and passwords.

Find a safe place to list all of the websites for the accounts that you have. 

We would recommend a secure password software like LastPass where you can give your loved one a single login, and then they'll have access to all of your important financial website logins and passwords. You can even categorize all of your logins within the software by category (financial/social media/work).

Once whatever software you choose is setup, just give the login name and password to your spouse. If you have a security question, give the answer to that, too.  If you have a picture you must choose before logging in, write down what that is.

Just make all of the information available so your spouse can login even if you can’t convey information to him or her because you’re incapacitated or have passed away.

Setup Emergency Access

If you prefer to not give your spouse your login right now, software like LastPass also have the tools in place to give a trusted contact(s) emergency access to your account.

LastPass emergency contact - Password software

You just enter your trusted contacts in the emergency contacts section, then if they request access if something happens, if you don't respond within 48 hours they'll be given emergency access.

Show Your Spouse Important Information

Next, show your spouse exactly where you’re keeping all of this important information so that he or she can find them if they’re needed. 

For your part, make sure you keep the documents in the same spot you told your partner so he or she can find them.

Keep Your Lists Current

While it’s great to set up this system, if you set it up and then don’t touch it for five years, your partner may still be lost should he or she have to take over. 

Every time you change a password, make the change on your master sheet (LastPass makes this easy). 

Every six months or so, review the information and make sure that it’s still valid.  Over time, you’ll close some accounts and open others, and some bills, like mortgages, may be taken over by other mortgage companies. 

Make sure your list stays current.

While you may be frustrated that your spouse doesn’t participate in the budgeting process, realize that there are likely things he or she does around the home that you have no interest in doing. 

Then, take the time to create a system where your spouse can take over for you with minimum disruption, should the need arise.

Are you the budgeter in the family?  If so, what steps are you taking to make sure your spouse can take over if need be?

what if i die - steps to take for your spouse

How Much Money Are You Saving In Your Emergency Fund? Have You Ever Had To Use It?

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Earlier this week there was a discussion at getrichslowly.org about a poll they had done about emergency funds. 

One of the findings was that the amount people were saving in their emergency funds seems to be dwindling over the past 5-6 months.

After reading that post I started looking for other polls to find out how many people are actually saving up an emergency fund in the first place,  and to see what they believe is a good place to get their emergency money.

Poll About Emergency Funds

The numbers seem to vary a bit depending upon the source, however, I found a Gallup poll from a few years back that found only about 4 in 10 Americans say they actually have cash on hand in case of an emergency.   Only 10% say they have $1,000 in cash available in case of an emergency.

emergency funds

When you dig a little deeper you find that a lot of people aren't depending mainly on cash savings to bail them out in case of an emergency.

Three in four consumers say they would use their savings account as a money source in case of an emergency. Fifty-six percent say they would use credit cards and 50% would borrow from a relative. Thirty-nine percent say they would use their 401k retirement account and 37% say they would use their home equity account.

So besides cash savings (75%), people say they would use these sources  to help pay for an emergency:

  • Credit cards (56%)
  • Borrow from relatives (50%)
  • 401k retirement account (39%)
  • Home equity loan (37%)

Based on the fact that only 10% say that they have $1,000 in cash on hand for an emergency, and the fact that so many are depending upon other ill-advised sources of emergency money, I'd have to say people are in general woefully under-prepared.

How Much Money Are You Saving?

So the question is this – how much money are you saving in your emergency fund?  Most experts (like Dave Ramsey) will suggest that you save at least 3-6 months of expenses in an accessible cash account.

Personally I think that's a good start, but at our house we usually fall more on the conservative side of things because of the large number of emergencies we've experienced in the past 3-4 years (hospitalizations, baby, car troubles).

We're currently sitting on a nice 10 month cash reserve in our online savings account, and we're building it to 12 months.  With the economy as it is, and with one spouse staying home to be with our son, we just feel more comfortable having a bigger cushion in case something were to happen.  And something WILL happen.

Money magazine says that 78% of us will have a major negative event happen in any given 10-year period of time.

Have You Had To Use Your Emergency Fund Yet?

Another question for commenters: Have you had to dig into your emergency fund at any point yet?  I'd be curious to know what types of expenses count as an emergency, and just how big those expenses were.

For us we've been in a state of continually renewing our emergency fund over the past few years. First my wife was in the hospital for several weeks, which ended up costing us several thousand dollars after insurance kicked in.  Our emergency fund covered it, and we quickly refunded it.

We also had a car that died on us – when the engine decided to give up the ghost.    Luckily we had saved up a car replacement fund, and only a small amount of our emergency fund was touched.

Next we had another hospitalization for my wife – again covered by insurance, and then by our emergency fund.

So as you can see – major negative events can and will occur – even frequently sometimes!

How much are you saving for your emergency fund?  If  you don't believe in having a large cash reserve, how will you be paying for any emergencies that crop up?  Have you had to use an emergency fund yet? If you have, what was the emergency? Tell us your thoughts in the comments.

Dave Ramsey’s 7 Baby Steps: Step 2 – Pay Off All Debt Using The Debt Snowball

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In my last post in the 7 Baby Steps series, we looked at Baby Step 1, saving up an emergency fund of $1000.

You save up that baby emergency fund in order to insure yourself against the risk of life's little emergencies that have a way of popping up at the least opportune time.   If you don't save up that money as an insurance policy, you can be assured that your plan to get out of debt will be set back many times over by many little “emergencies”.

If you have an emergency fund saved, no new debt is created, and you just take the time to re-stock that emergency fund in case of further expenses.

Today we will look at Baby Step 2, paying off all debt using the debt snowball.

Pay Off Your Debt Using The Debt Snowball

Now that you’ve got your $1000 emergency fund saved,  it's time to get intense about paying off all your debt.  Dave Ramsey likes to call this getting “gazelle intense”, in reference to the bursts of speed and intensity a gazelle will use in order to get away from a cheetah (or in our case, debt).

For many people this step is the longest in your 7 baby steps.

If you’ve  built up a lot of debt over the years in the form of student loans, auto loans, credit card debt and other things, it probably took you a long time to get so far in the hole, and it will take quite a while to dig your way back out.  But you CAN get back out!

If you're not so far in the hole, getting out of debt can happen a lot quicker, and you can get on to the next steps of building up a larger emergency fund, paying off your home early, building wealth and giving more.

If you've gotten this far and you haven't done a budget yet, now would be the time to get started.

Figure out where you are in regards to your income, expenses and your debt obligations.  Do a zero based budget and make sure that every dollar is accounted for – because every extra dollar is now going to be going to debt reduction.

Once you’ve got all of your income, expenses and debt listed, follow these steps to get rid of your non-mortgage debt. (Mortgage debt is paid off separately in another baby step, so exclude it for now)

The Debt Snowball

Here is a rundown of the debt snowball plan.


  • Put all your debts in order from the smallest balance to the largest balance.
  • After you have paid for food, clothing, transportation and a roof over your head (the necessities), pay the minimum payments on all of your debts.
  • Put any extra money left over towards paying off the smallest debt first.
  • Pay off your smallest debt, and then “snowball” the money you were paying on that debt over to the next largest debt.
  • Continue paying off the next largest debt, and when that one is complete, roll it all over to the next largest debt until you are completed.

That's not too hard, right?  Just pay off your debts from smallest to largest until they are all paid off!

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