Because 2020 was rough, buddy.

2020 has been tough on many people across the world financially.

After the lockdown was enforced in March 2020, we see an unemployment rate saw a sharp increase as businesses across industries struggled.

How many jobs have been lost globally since the beginning of the COVID-19 pandemic?

The IMF tries to answer this question by referencing estimates by the UN's International Labour Organization (ILO). Assuming a 48-hour working week, the reduction in work hours in the second quarter of 2020 was equivalent to the loss of 495 million full-time jobs, which added to the equivalent of 160 million full-time jobs lost in the first quarter.

The ILO expects the losses to pile up as the year nears to the end, with a decline in working hours in the third quarter equal to 345 million full-time positions—19.8% of which in the Americas, 12.4% in the Arab states, 11.6% in Europe and Central Asia, followed by Africa at 11.5% and the Asia-Pacific region at 10.7%.

Looking further ahead, in a baseline scenario, an estimated equivalent of 245 million full-time jobs could be lost in the fourth quarter (whereas the pessimistic view projects a loss corresponding to 515 million posts, and the “optimistic” view to 160 million). Gone in the blink of an eye, many of these work hours will take months or years to come back while others might not even exist anymore once the pandemic is behind us.

Additionally, while others may have kept their jobs, they may have been asked to take forced unpaid leave or accept pay cuts.

Even if your job remained secure, in light of the year we just went through, it's safe to say you just never know what may happen.

As we continue to navigate through the COVID-19 pandemic, it's important to take the new year as an opportunity to start practising good money habits to protect yourself and your loved ones.

Here are 7 tips to get you started:

1. Fix your budget and stick to it

There are lots of different ways to create a budget. The most common budget breakdown is 50/30/20. This is how it works:

• 50% of your income goes towards needs, such as housing, transportation, food, and other essentials.
• 30% of your income goes towards wants, including vacations, travelling, massages and spa days, clothes shopping and so forth.
• 20% of your income goes towards your savings and debt repayment.

To start building your budget, write down all your needs, wants, debts, and savings. Remember everyone's budget will be different, and things can change from month to month depending on different variables in your life.

The important thing is to ensure you pay for your needs, savings, and debt, before spending on your wants.

2. Track your expenses, even the tiny ones

A great way to save more money is to track your expenses. When you see all your spending laid out in front of you, you're sure to see unnecessary expenses that can easily be cut out. Remember that even shaving off $50 a month will lead to $600 in savings at the end of the year!

Some items that you can consider cutting out of your budget for extra savings include:

• Eating out or ordering food delivery (instead learn simple recipes or meal prep for the week)
• Buying things on sale just because they're on sale (often you don't actually need these things, right?)
• Shopping for new clothes and accessories (you can always join a clothes swap or try thrift shopping)
• Drinking coffee from expensive cafes (a treat once in a while is fine, but you can invest in a coffee machine at home and save so much more)

There are plenty of free and paid apps that can track your expenses, including Zenmoney and Money Lover. Even many banking apps now offer the service for free. Make use of it!

3. Take another look at your fixed costs

While there are some fixed costs that offer no leeway, such as student loans, there are other costs that can be minimised.

For example, your rent. If you're able to work remotely but are still paying high rent to be closer to the city, you may want to consider relocating further to the outskirts where rent is cheaper.

Other fixed costs that can be relooked include:

• Transportation: you may want to consider public transport or carpooling.
• Utilities: lower your electricity and water bills by being more energy-conscious.
• Memberships and subscription services: from monthly gym memberships to online 

streaming subscriptions, look into what you really use, what you can go without, and cheaper alternatives that are just as good.

4. Consider investments that grow on their own

You don't need to have a lot of cash in order to start investing. A great way to get started is with unit trusts or fixed deposits.

A unit trust pools money from investors into a single fund. This pool of money is managed by a fund manager, who will help you invest your money in a variety of investments.

Meanwhile, a fixed deposit helps you earn higher interest rates compared to regular savings accounts. Depositors will be required to retain their deposits in the account for a pre-determined tenure in order to enjoy the returns.

You should speak to your bank for more information before making any decisions.

Other ways to invest include starting an education fund for your children, a retirement fund for yourself, or taking up an insurance plan.

5. Look into other ways to earn a side income

If you already have a passion that you spend a lot of time doing, you can consider earning a side income from it too.

For example, getting certified as a yoga instructor and offering online classes or personal 1-on-1 sessions; teaching a musical instrument that you already specialise in; becoming a video game streamer and monetising your channel.

Other ideas to earn a side income include:

• Becoming a drop shipper or online seller for existing brands
• Freelancing as a writer, photographer, graphic designer, or any skill you already possess
• Home baking or cooking set meals
• Tutoring students online or in person
• Renting out the extra room in your home
• Working as a delivery person after office hours

6. Start paying down your debt

If you have credit card debt, always try to pay more than the minimum payments each month, as the minimum usually only covers the interest and little to no principal.

Don't hold off on paying this debt, as the interest will continue to grow and if left unchecked, you may even end up getting blacklisted. 🙁

If you have one or more credit cards that are charged to the max, it may be worth consolidating your debt. A personal loan could be a good way to consolidate the charges into one monthly payment. Take note that this only makes sense if the personal loan has a lower interest rate than your credit card!

For example, if the interest rate for your credit card is 15%, you could get a personal loan with a fixed interest rate of 10% and save that 5%.

7. Build an emergency fund

An emergency fund can help cushion you in the event of an unexpected expense, such as medical issues or job loss. Fingers crossed, you'll never have to use it, but just in case, it's important to have that safety net.

The recommended amount in an emergency fund is three to six months’ worth of expenses. Be sure to set up a separate savings account for this fund (so that you don't accidentally spend it), and set up a direct debit so the money gets saved there every month automatically.

At the end of the day, the best advice is to live below your means

That doesn't mean that you can't splurge or spoil yourself once in a while. Instead, save up for that special treat. It will mean so much more!

If you're fortunate enough to get a promotion, raise, or higher paying job, don't simply increase your monthly spending. Take it as an opportunity to save more for a solid financial future.

Make the most of coupons, purchase pre-loved instead of new, keep money in a savings account and emergency fund, and start a side hustle.

A simple lifestyle doesn't mean it has to be boring.

Stay safe in 2021! Remember to make good financial choices <3