You never know when an economic crisis strikes. You cannot decipher a pay cut or job loss. Thus, one must prepare for the worst now. Budgeting helps one waive off the financial anxieties. It allows one to counter critical economic events without much impact. You can start one after the event occurs. It does not leave one with enough financial flexibility. You only think about survival over saving. Moreover, it is fairly challenging for individuals with low incomes.

Thus, consider your existing finances and start planning now. Identify which of the aspects you must cover first. For example- you must be free from debts to save efficiently. Thus, the best strategy to settle the debts must be prepared first. The lower the liabilities, the more you save. It is the first thing you can do. The blog discusses other ways to prepare for the unforeseen. It lists some tips that may help you navigate the crisis.

How to save enough to counter economic uncertainty?

The cost of living is increasing in the country. The Consumer Price Index, including Owner Occupied Houses costs, rose by 2.6% in September 2024. Moreover, the average rent increased by 8.4% in the very month. Thus, one must take the noose and dominate the financial landscape. Identify the aspects that may help you budget more. It could be cancelling unnecessary subscriptions or postponing a few goals. Here are some strategies to save money for economic uncertainty:

1)     Analyse the incomings

One of the most important parts of budgeting is- analysing the income. It would help you understand the incoming. Consider all your earning sources. Individuals with inconsistent income, like self-employed, may struggle to determine one. However, you can decide one by considering the average income. How much do you earn a month on average? It would help you know your income better.

2)     Identify your expenses

Next, identify expenses that you incur weekly or monthly. Your weekly subscriptions may include- medicines, groceries, etc. Identify how much you spend on such items. You can include expenses like- Rent, utility bills, gas bills, weekly cab bills, etc. Include even the smallest costs that you incur. Sometimes, it is challenging to remember everything.

Don’t worry, you don’t have to. Just list out such items and calculate the costs.  Knowing your regular and irregular expenses helps analyse savings. You can subtract the expenses from income to get one.  Yes, your small investment dividends also count as income.

3)     Discontinue unnecessary subscriptions

You can spot multiple subscriptions that you pay for out of habit. Identify each subscription, be it OTT, gaming, or groceries. Check how frequently you use that service. You don’t need one if you have not used a particular OTT subscription for over 6 months.

However, you pay through direct debits unknowingly. It is just a waste of expense. Instead, you can use the amount towards credit card bill payment. It is something that individuals struggle with the most. Check such subscriptions and discontinue or unsubscribe from them. Usually, unsubscribing doesn’t entail a fee. Analyse the procedure and do the needful.  It will help increase your savings pot.

Alternatively, reduce the use if you often struggle with credit card payments. Instead, switch to better options like quick loans. These are affordable and easy-to-repay financial options for small needs. You can use it to finance energy bills and repairs and bridge important payments.

You don’t need a stellar credit history to qualify. Instead, you may get fast loans in Ireland on proof of relevant income. Compare the rates, monthly payments and APR before applying. No documentation, guarantor or collateral requirement eases up the approval. You get the money the same day. It helps you meet any simple need under €3000.

4)     Sell equipment you don’t need anymore

Every household has some machinery or equipment that they don’t use anymore. It could be an old washing machine, axe, weight measuring machine, etc. Consider such things lingering in your house. You may spot ample items or gadgets. Check whether you will use these in the future. If not, set it up for sale. You can list the products on Amazon or Shopify by creating an online shop.

You would need first to buy the store to sell items. It is ideal only if you have too much useless equipment. Otherwise, just check the best online platforms and list product advertisements. The interested buyer may contact you for the purchase. You can negotiate the costs accordingly.

It is one of the best ways to boost your savings. You don’t know, but you may earn €6000 on average from an equipment sale. It depends on the usage, demand, and the price.  Set a competitive price for a quick sale.

5)     Consolidate your debt

As mentioned in the introduction, debt clearance is a critical part of budgeting. You cannot save with a whopping debt under the belt. Instead, analyse and systematise the debt payments. You can either pay the lowest one first. It is easy to settle debts that way. You can, for example, begin by settling the small loan debt of €1500; next settle the credit card bill amounting to €5000.

Similarly, set the payment deadline and pay accordingly. Alternatively, consider paying one with the highest interest first. It is beneficial from the credit perspective. However, generally, these are the costliest debts. If your profile has high-interest debts exceeding 8 debts, consolidate. It is one of the best ways to reduce the liabilities towards payments.

Explore the best personal loans to merge your debts. You may get one despite a low credit history. Check money loans in Ireland with a bad credit history. Identify the quotes, interest rates and other costs. You can also pre-qualify to know the approx. Costs. Accordingly, you can decide the best one for your finances. Settling debts this way is one of the smart decisions. It helps save money and improves the credit score.

6)     Reduce your insurance liabilities

Apart from analysing the monthly payments, check premiums too. You may have insurance cover for life, car, and other aspects. Analyse the benefits you claim on such insurance. Are these favourable for your life goals and style? If not, switch to a better one by re-analysing your needs. It may mean paying less premiums and saving more money.  For example- if you don’t use the mileage you pay for, switch to an affordable model.

Bottom line

These are some of the best ways budget hacks that may help you navigate an economic crisis. Identify the aspects that you can save on. For example- limit your expenses on additional subscriptions. Check whether you can downsize your home. Additionally, debts can be settled by strategising payments.  Moreover, saving more will help you create an emergency fund. It will help you counter critical emergencies without worries.