“Life looked very different a few short months ago.” This was the opening statement of Veda Ajwani, an entrepreneur and Basis community member.

Covid was an unexpected visitor earlier this year. Along with it came a series of unfortunate events such as mass unemployment, uncertainty in the economy, and a complete halt in our lives. We all have been working from home ever since, and this has taken a toll on our mental health and holistic well-being. But throughout these tough times we have seen Basis members emerge ever strong and committed to making the best out of the situation. Here is one such story. How has your expense tracker shifted in the wake of this situation?“Earlier expenses went considerably towards channels such as entertainment, content consumption and other spends that could have been avoidable, people including myself are now worried about essential areas such as paying bills, health care and affording rent and paying EMIs in the case one has a loan.”

“Essential expenses are not a shortlist for people, and once this realisation set in with me, my focus pivoted towards building just that.”

As true as this scenario is, understanding that ‘essentials’ are different for different households and beyond the common household expenses, people are now prioritising what is important to them. Expenses such as electricity, internet, multiple gadgets needed at home have gone up as children study from homes and working members work from home. This means additional costs that were not essential otherwise, have now become so.

But Veda is not alone here. This is the case of every household, every family and every parent and working woman out there. Understanding what’s important is crucial, and even more crucial is the task of budgeting and cutting costs. Our current lifestyle doesn’t really allow for recycling and reusing. Remember when something broke at home? You would probably repair it. That was until the new object became just as cheap as repairing costs. Whether it was your cell phone or tablet, this trend has now shifted. But with the current situation, families are now choosing to fix things rather than replace them. This is something we don't account for well. People have realised they do not want to be in this place again, and are projecting this for the near future too. Travel planning is something that has taken an obvious hit since there is no visibility of that recovering. This period has also taught people that there is a lot they can do on their own and manage it alongside their regular work. So whether it is cutting on services they can now handle themselves or changing their lifestyles to literally buy board games v/s a game-box. Since work from home has also become an extended option, costs such as fuel and transport are seeing cuts as well (which is, not too bad for you, me and the environment!)Do you see this cost-cutting continuing for a while? “Yes, most certainly, as an economy and individuals, a lot has changed. These times have hit everyone, whether high-income individuals or middle-income families. Businesses, start-ups, salaried individuals this period has left all of us most unprepared. The last time something as bad or worse happened was 2008, where most of the millennials of the current generation were still in school. There was a huge disconnect between the perception and reality of the financial future.”

With families choosing to work from home, we have seen nuclear families go back to a joint family set up not only to cut costs but also have an extended support system. Pivot or perish is not something that applies only to businesses but also to families who need to pivot their spending patterns. While not everyone will live in a frugal manner, most families will certainly see what is optimal for their spending and not exceed that in the future.Pay cuts and job loss are the top reasons for finances going off track. How should people who've dealt with these situations tweak their household budget?

“First stop trigger happy spending via credit, whether through cards or other term loans.”

We all know this answer too well. Here are some things Veda did to help her through this time.

1. Consolidate your investments, people often move jobs, have multiple bank accounts, EPF balances lying unattended and now is a good time to consolidate those.

“My husband works with a leading IT company and I co-run a startup, while we haven't been hit hard yet, as we see others cut expenses we've incorporated certain cuts too.”

2. Spends such as those on children, utilities, groceries, health care cannot see cuts on budgets.

It's all the “excess”, hoarding has become a habit, buying 3 for the cost of 1 and having products expire and go waste. People should buy as much as they need however cheap it might look at the moment. A lot of household budgets went on expenses such as shopping, a good way to cut down expenses is also to be open to hand me downs from your close family or friends and exchange things when you might need them v/s buy them for usage that doesn't occur so often.

3. Move localities to inexpensive suburbs if you have the option of working from home, that can bring down rentals and provide extra cash for comfort.The current economic scenario has been difficult for all of us. But what’s important to note is that it has taught us to be stronger versions of ourselves. So the next time adversity comes, we can safely say, NOT TODAY!#womenempowerment#women#womeninbusiness#financialfreedom#womenempoweringwomen#motivation#money#investment#entrepreneur#wallstreet#financialnews#personalfinance#inspiration#strongwomen#womeninspiringwomen#womenpower#empoweringwomen#empowerment#selfcare#loveyourself#instagood#woman#womenentrepreneurs#financialindependence#financialliteracy#Covid#coronavirus#indianhousehold#covid19