Ways you can save money during the COVID-19 pandemic

The COVID-19 pandemic is proving to be not only a major health concern for the global population, but also a huge financial concern for businesses and individuals alike. In a time of economic uncertainty and risks of unemployment, here are a few ways you can save money during the coronavirus crisis.

Consider changing your savings account:
While Australian interest rates are at an all-time low, savings accounts which offer an interest rate of over the 1.8% inflation rate still exist. If your savings account is offering interest rates below the annual inflation rate, consider switching over to a bonus savings account, where bonus interest rates are offered to customers who satisfy the various requirements each month (e.g. making a deposit each month). Introductory savings accounts are another temporary and popular option, as they typically have much higher interest rates for the first few months before reverting to a lower rate after.

Having a comparatively high interest rate isn’t the only reason to consider changing your savings accounts, as there are others which come with more helpful financial tools and features. For example, spending insight tools and bill payment reminders may help you plan out your savings during these trying times.

Look into a long-term term deposit:
Similar to a savings account, a term deposit is a relatively risk-free place to store any cash you may have. However, a term deposit is an option to consider if you are looking to cash away your savings for a long time, as customers may receive penalties if they take out money during a specified length of term. Term deposits are also low-maintenance and if you’re able to find one offering a high interest rate, it’d certainly be a safe place for you to store your savings during these uncertain times.

Review your credit cards:
Take advantage of your extra time and review your credit card debts and fees. Cancel any credit cards that you won’t be using in the current conditions (especially travel credit cards) and save those that you will need for a sustainable daily lifestyle, which also preferably have low interest rates. While cancelling credit cards, also consider using a balance transfer to transfer your debt from one credit card to another to simplify the process and keep things uniform. If you’re able to, taking care of any debt on your credit cards now would be more practical than accumulating interest and paying back at a later date.

Apply for assistance:
The Australian Federal Government has implemented many financial measures to help individuals with their financial struggles amid the COVID-19 pandemic. For example, welfare recipients can apply to receive an extra $550 per fortnight as well as a one-off $750 cash payment. The JobKeeper program which pays employees a minimum of $1,500 per fortnight is also available to working or individuals who have been stood down. To apply and find out more about the assistance schemes that you are eligible for, visit the Centrelink website and start your claim.

In addition to the Government, Australian banks are also being more understanding of individual circumstances and have relaxed their criteria in terms of mortgage payments (with six-month repayment deferrals), personal loan repayments and easier access to term deposits. Contact your bank if you are experiencing financial struggle as a result of COVID-19 and they may be able to help you.