Although we are still in the midst of a pandemic, we are beginning to see the light at the end of the tunnel as vaccines become more widely available. While we all have experienced different challenges this past year, we are starting to see a more positive outlook across our state.
On average, Virginians are feeling more optimistic than the rest of the country about the future of the economy, according to a recent poll from the Roanoke College Institute for Policy and Opinion Research. We are also seeing an increase in jobs. Virginia’s unemployment rate dropped to 5.3 percent in January with the addition of 14,100 jobs.
This positive news, coupled with stimulus checks and 2020 tax refunds, provides a timely opportunity for individuals to reassess their financial goals. Here are some tips to consider today or tuck away for tomorrow.
Supplement, or rebuild, your emergency fund
This past year has proven how crucial it is to have emergency savings during an unplanned life event. The goal with emergency funds is to have enough money available to support yourself and your dependents for at least 3-6 months. Every little bit helps to give yourself a cushion to fall back on. If possible, save part or all of your stimulus check or tax refund to extend or create a personal emergency fund.
Pay off debt
It is also a good idea to pay down, and more specifically, pay off high-interest debt. Minimum payments and high interest rates can add stress to an already difficult financial situation. If you are able to pay off that debt, you will save on payments throughout the coming months, providing a long-term boost to your bank account.
Revisit your household budget
Throughout the past year, business closures and social distancing protocols forced individuals to cut back on recreational spending (e.g., going out to dinner, vacations, movies, concerts, etc.). As we start to return to a new normal, now is a good time to reassess your household budget and evaluate opportunities for where to save or where to spend. If you are able, consider supporting those that have been hit hardest, such as small businesses, local restaurants and other companies forced to temporarily close during the pandemic.
Set your long-term savings strategy
While examining your household budget, you can also look ahead to long-term savings, such as putting money away for retirement or education. Consider planning for other big financial goals, such as buying a house or a car, or planning a wedding. Using a budgeting calculator makes the process simpler, enabling you to meet goals, prioritize expenses, and list monthly and annual expenses compared to your income.
Looking beyond the pandemic, we now have the opportunity to reflect, reconsider and implement ways to plan ahead for long-term financial stability. Even little steps can make a big difference when it comes to meeting your financial goals. For more tips and tools, please visit Atlantic Union Bank’s free resources available through Banzai.
Maria Tedesco is president of Atlantic Union Bank and leads the commercial banking, business banking, consumer banking, wealth management and mortgage teams, as well as enterprise-wide functions of marketing, digital strategy, product management, business line risk and customer experience.
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