Let’s be honest: Things could be tough out there for a while.

As the coronavirus continues to spread and increasingly stringent social distancing measures are put in place, our economy is suffering. If you’re an hourly worker whose place of employment is closed or a restaurant server who depends on tips to survive, chances are good you’re already feeling the pinch.

Of course, the longer this goes on, the more damage is going to be done. Yes, Congress is about to pass a $2 trillion stimulus package meant to bolster the economy and help those who are suddenly unemployed. But the simple fact is that not all businesses are going to make it. More businesses will shutter, more employees will lose their jobs, and the pain will likely continue for the foreseeable future.

In uncertain times like these, it’s important to get your own financial house in order. Even if your job is not in immediate jeopardy, you need to prepare for the chance of a pay cut or a complete loss of income. When it comes down to it, you can’t depend on anybody else – including the government – to bail you out of this.

Although it would have been better to start preparing for a financial disaster like this before it actually happened, there are still plenty of measures you can take right now to protect your financial future. Here are five money moves you can make right now to shore up your finances and ride out the coronavirus storm.

 
 

1) Create a Budget

The most important thing you can do right now is to start a budget. Now, before you get all bent out of shape, it’s important to understand what a budget is and what it isn’t.

If you’re like most people, the idea of “going on a budget” conjures up some unpleasant thoughts – like complete spending freezes or giving up all of your favorite creature comforts. Perhaps you think you’ll need to stop ordering sushi from your favorite takeout restaurant. Maybe you’re afraid a budget will keep you from renting “The Invisible Man” from Amazon, further deepening the quarantine blues. Not true.

You see, most of us budget like we diet, and that’s why it doesn’t work. We take our budgeting to the extreme, depriving ourselves until it hurts, until our budget eventually fails. We’re willing to deal with the pain for a while, then we can’t take it anymore…so we binge.

That’s not an effective way to budget.

In reality, a budget is simply a plan for our money. It helps us see exactly how much money we currently have, how much is coming in, and how much money we have going out each month. By writing all of this down, a budget provides a concrete, visual plan for how to use our money efficiently. So, instead of being restrictive, a budget actually helps us use the money we have more effectively – wasting less on things we don’t need so we can spend more on the things we actually want.

Creating your own budget only takes a few minutes a month. It’s pretty simple and can end up saving you thousands. Here are some ideas that can help you get started right away:

 

2) Begin Tracking Your Spending

Tracking your spending is the perfect compliment to starting a budget. While a budget serves as your monthly money plan, tracking your spending shows you the actual results.

One of the best money moves you can make is to compare your actual expenses with your budget. This shows you how well you did in both your planning and execution. It also provides insights on where you need to make adjustments in your budget for next month.

Again, tracking your spending is easy – you just need to remember to do it. You can use a simple sheet of paper or a spreadsheet if you like. Some of the best money apps will even help you track your spending automatically. Here is a good guide to help you get started:

 

3) Eliminate Unnecessary Spending

Now that you have your budget and are tracking your expenses, look for ways to eliminate unnecessary expenses. This can provide a huge boost to your personal cash flow. It might seem obvious, but the less you spend on things you don’t need, the more you’ll have for the things you do.

Look, nobody expects you to stop ordering takeout during the COVID-19 lockdown. I mean, that is one of the few things I look forward to right now – and, there is something to be said for boosting your morale.

With that said, perhaps you only order once or twice a week instead of four times. Maybe you keep expenses lower by skipping the appetizers and drinks. It’s all about making choices, not eliminating your spending completely.

To get started, go through your budget and look for any fixed expenses you may no longer need – like old subscriptions. Then, compare your budget to your actual spending to determine if there are any leaks in your budget. Are you seeing expenses you didn’t plan for? Are you spending more than you thought on food or entertainment? Find those discrepancies and make adjustments as necessary.

 

4) Build an Emergency Fund (If Possible)

An emergency fund is exactly what it sounds like – a stash of money that you set aside specifically for emergencies (like unexpected car repairs, medical bills, or income loss). Having an emergency fund can help you make it through any unexpected bumps in the road and is perfect for situations exactly like this. Heck, if this pandemic doesn’t convince you of the necessity to stash away some emergency, I honestly don’t know what will.

Now, if you’ve already lost your job or taken a massive pay cut, it might not be possible to start building your e-fund right away. However, the moment you’re back on your feet, get to saving. While this rough patch will eventually pass, there will be others. You’ll be thankful to have your emergency fund the next time an emergency or loss of income occurs.

On the other hand, if you are still working and your income has not been affected to this point, consider yourself lucky. Also, it is absolutely imperative that you start building your emergency fund immediately. Not tomorrow. Not next week. Now. Like yesterday!

Start by saving at least $1,000 in your emergency fund. While this isn’t ideal, it’s at least enough to get you started.

Eventually, you’ll want to have three to six months worth of expenses set aside in your e-fund. Personally, we prefer to keep between six and twelve months expenses in ours. Either way, get started saving, and do it immediately…before it is too late.

Check out this guide for more information on how to start your emergency fund:

 

5) Leave Your Investments Alone

Ask almost any financial advisor what you should do with your investments right now, and they’ll tell you the same thing: Don’t do anything. In fact, Holly interviewed a slew of them and that is exactly what they said!

Trust me, I know how tough it can be to watch your investments and retirement accounts lose money in a down market. But you have to remember, just like the gains you’ve been enjoying the last several years, your losses are just “paper losses” until you sell.

Instead of hitting the panic button and selling, ignore what’s going on in the market. You’re in this for the long haul. Continue making the same contributions you regularly make at the same time you regularly make them. Same bat time, same bat channel.

In fact, if you have the ability to do so, consider investing even more right now. While there are no guarantees, in the past, the stock market has always found a way to recover eventually. By purchasing stocks at a lower price now, you’ll decrease the average price you paid for your portfolio – helping you to enjoy even bigger returns in the event that the market eventually recovers.

What money moves are you making to shore up your finances during the coronavirus outbreak? Let us know in the comments below!