I do not mean food here. I am still consuming more calories than I burn on a daily basis.
What I meant here is my day-to-day living expenses – I found that I am forced to consume less in the new reality of being confined at home.
It is both good and bad.
Good for me because I am forced to scale down spending and conserve my money for those that are truly essentials – instant noodles and toilet paper.
Bad for the economy as a whole because whether we like it or not, our economy is driven by consumption – the reason why we are heading towards a recssion is because COVID had made us lose our appetite for consumption.
And by consuming less, someone somewhere is earning less.
No matter how much fried chicken and junk food the central banks and governments try to tempt us i.e. with their monetary expansion policies and stimulus packages, the fact is we are still too sick to consume and we need to recover from our illness first.
So in today’s post, I will like to talk about expenses that were cut down during this pandemic.
#1 Air Travel
I know it is tempting. Air tickets have never been so cheap.
They are cheap for a good reason too.
By not traveling, you are not only doing yourself a favor by limiting your chances of being exposed to the virus, you also do you fellow countrymen a favor by not bringing the virus back to your home country.
Your health and the health of your family is a priority. It is not worth risking your health to for a good deal.
Trips can be taken later once the situation is under control. But your health may or may not have a lasting impact.
The funny thing is that I am supposed to be in New York this week, and it was good thing that the trip never materialized since New York is now the epicenter of the pandemic.
#2 Eating Out
If your country or city is in a lockdown, you probably do not even have the option of eating out.
Eating out is certainly more convenient and enjoyable but it usually is more expensive.
By preparing your own meals, you can opt for healthier choices and it costs much cheaper (costs in terms of money not time).
Of course, if you chose to opt for food delivery and take out, your expenses might still be roughly unchanged.
#3 Social Events – Drinking, Clubbing, Social Parties, Concerts
Governments around the world have been limiting social events and banning large social gatherings.
Those events sometimes do cost a lot so take this as an opportunity to save some money.
COVID-19 is also a great excuse if you want to turn down your friends who will be attending the corona party
#4 Transportation – Daily Commute
I am fortunate to be working from home since the COVID outbreak worsen. Some may have faced furlough or layoffs so I am already very grateful.
One of the small benefits from this is I have to cut down on my transportation expenses which is not significant because I commute by public transport.
For those who own cars and commute regularly, their expenses will reduce more substantially.
Unfortunately, all time low oil prices does not usually trickle down to us consumers – we still pay the full price for fuel.
Warren Buffett was also happy about this. He remarked that since the COVID-19 outbreak people have been driving less, so good for GEICO since less accidents means more profits. I would also add: good for the environment and good for motorists’ safety as well – obviously not a huge priority for him.
#5 Shopping – Consumer Discretionary
As a mall rat, I used to hit the malls every weekend prior to COVID-19.
And I must say that it had worked out well for me. For the past month, I found that I had spent significantly less by not going out to malls by spending less on buying stuff and eating out.
I thought that my quality of living would decrease if I were deprived of malls but surprisingly I still enjoyed my weekends (or weekdays since I am home most days and the lines between weekends and weekdays are blurring…)
There is a reason why certain industries are hit worse in this pandemic mainly tourism, travel, retail, events, and food & beverages. We as consumers are forced to reduce our consumption in those areas due to social isolation imposed by the governments.
Unfortunately, those sectors also employ most of lower wage workforce and this recession or crisis might be worse for them. There will be more layoffs and furloughs as businesses, especially smaller business, try to stay afloat.
So with the money saved, why not donate that money to people who need them? Do search and reach out to your local food bank or charities to help people survive this trying times. Or help donate medicine or medical supplies to those who need them.
While it is good that governments are deploying or considering deploying helicopter money to help these group of affected people, we too can play our part to help others too.
Invest in humanity, show kindness to people. This is what makes us human and this gives us the resilience to bounce back from each hardship.