Page 30 - The Standard Volume 4

Budgeting in a Pandemic
Jayson Cardwell
So here we are, a little after two years of the first COVID-19 cases that began to arise in the Midwest. We have seen businesses shut down, events cancelled, and the United States government throwing money at its citizens who may or may not have lost their jobs. So how should a person’s budget look in a pandemic? Are there any special considerations one should factor in? Well, not to spoil the big reveal BUT budgeting now isn’t really all that different from budgeting in the “before COVID” times. Let us look at the basic construction of a holistic budget.
When discussing the term “budgeting,” we’re talking about monetary allocation. Money hits your bank account at certain times of the week, month, or year. That money also finds its way out of your bank account at certain times of the day, week, month or year. A budget helps us to allocate our income to prepare for the expenses so that the course our lives are on does not get disrupted and the goals we set are eventually met. If your life is currently aimless and you have no goals in which you are working towards, there is a good chance your monetary allocation is aimless as well and financial progress is not even on your radar.
Everyone has different goals in life that they may be reaching for. Debt elimination, home ownership, college education, early retirement, or a ‘round-the-world trip could be on their list of goals. As well, everyone has different priorities in life that affect how they spend money, so I am not going to get down into the nitty-gritty of where your nickels and dimes need to go. Budgeting should be broken down into three general categories and you as the reader can fill in the details based upon your priorities. Let’s jump into the first broad category and that is The Necessities.
The Necessities is just as it sounds. These are the expenses in your life that are REQUIRED to continue to function, remain safe, and continue to earn income. In this category we’re referencing expenses such as rent/mortgage, car payments, various insurances, food, etc. Most individuals see this category as important and the first line items that need to be funded and rightly so. The difficulty in budgeting for this category is the variable expenses that fall into this category. When these variances are not accounted and planned for, they can have a detrimental effect on the other two categories we have not touched yet. With that being said, through careful planning we can mitigate this risk. When crafting a budget for your fixed expenses, it helps to have a copy of your expenses from last year or at the very least, a total for how much you spent in each category for the
30 THE STANDARD | June 2022