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How to Make Money During the Coronavirus Pandemic – 3 Savings Tips

Frugal Investors Admin by Frugal Investors Admin
April 12, 2020
in Savings Resources
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The Covid-19 pandemic has caused an unprecedented closure of high street shops, restaurants, stores and mass gatherings including major concerts and sporting events. In short: this is the month where the earth stood still. That means making and saving cash is going to be more important than ever.

In the United States the unemployment rate ticked up to 4.4% in March. Meanwhile the New York Times pegs the number at close to 13% when official figures come in May. That isn’t exclusive to the US, either, as the UK lost about 1 million jobs in the first two weeks of the crisis and Canada has hemorraged 1 million jobs as well.

What can you do in this environment to make and conserve your cash?

As we advised in Five Golden Rules for Success During the Covid Crisis, this is an opportunity to get your financial health in order while you’re on lockdown.

Here are three tips to make valuable cash by leveraging something you have in abundance. Time!


(1) Re-negotiate your contracts with key providers (mobile phone, car insurance, TV/broadband)

Time: 1 hour
Savings: £325/year

When I was working fifty-five hours a week and wedged into a bus for the hour long commute, it was difficult to invest time in figuring out what the best deals would be for – well, anything. That being said while we’re under lock-down, you have to imagine, we’re all out of excuses now, right?

So now’s the time to grab the bull by the horns and ring up your car insurance company.

Before you do spend 10 minutes and pull up a website like Compare the Market and punch in your details, to get a basic set of quotes from various suppliers. Take that information (ideally the lowest quote) and ring your car insurance company. Tell them that you’re thinking of switching to (insert lowest quote provider here). I did this and managed to save £286 off my annual car insurance premium. All told the call took me a further 15 minutes.

The same goes for your mobile phone contract and house insurance. If it takes another 20-25 minutes each it will be time well spent. I switched from a £12 Vodafone contract to a practically-the-same £8 VOXI contract with 3GB more data than I had before. Instead of going over on data each month, I spent £4/month less and never get charged extra. Simples!


(2) Consider whether it is worth cancelling subscriptions and monthly recurrent bills

Time: 40 minutes
Savings: £225/year

Take 40 minutes and review the subscriptions that you have in place. With more time on your hands, do you really need them all? For example with all-you-can-eat home broadband do you really need a music streaming service? If you have meal subscriptions what about cooking meals yourself?

I run an independent financial website and therefore, from time to time, have a number of subscriptions in order to get the information I need. As it happens one of the free subscriptions that gave me 3 months free had suddenly gone to quarterly billing at £75/quarter. That’s £300 per year! Even worse, it was for a service I wasn’t using. Quick fix? Cancelled.

Here is a list of subscriptions that you should review and consider whether you need:

  • Streaming services (Netflix, Disney+, YouTube Premium)
  • Paid content (Spotify, Audible, Apple Store, Android Store)
  • Online shopping (Amazon Prime, paid delivery)
  • Cloud Storage (Asus, Microsoft One Drive, Amazon Cloud, Dropbox)
  • Meal subscriptions (Hello Fresh, Gousto, Blue Apron)
  • Magazine subscriptions

The reality is that you’ve got more time, especially if you’ve been furloughed and still have the promise of future employment. There’s a lot of what you could call convenience expenditure that is easy to reduce for now until we’re through this difficult pandemic.


(3) Take money you normally spend and invest it instead

Time: 2 hours
Savings: £2000-£3000/year

Depending on how much you managed to sock away in savings from part (1) and (2), you should be in a great position to invest what you’ve saved by the following month.

I know what it is like: it’s easy to put off managing your finances because it is onerous and there are other things to worry about. However, now’s the time to follow our Five Golden Rules:

  • Open a brokerage account (Robinhood in US, AJ Bell in UK, CIBC Investor’s Edge in Canada)
  • Review your tax free savings accounts and deposit money into them
  • Set yourself a clear savings goal with a Budget
  • Find suitable passive investments through ETFs
  • Learn how to manage your emotions

There are a lot of resources here at Frugal Investors designed to talk you through these steps. This includes how to institutionalise savings and track your finances, how to open a SIPP pension account and a link to our comprehensive finance tracking system.

Frugalist Investor’s Conclusions

If you can’t start investing and saving at a time when the world has literally come to a grinding halt, and people have plenty of time on their hands, then you probably never will. I know you can do it – because change happens today!

Tags: Coronavirus PandemicFive golden rules for savingsfrugal investorsSave moneySavings
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