Lasting changes COVID could make to our finances

Posted by TEBI on June 8, 2020

Lasting changes COVID could make to our finances




The COVID-19 pandemic has meant some big changes in all our lives in recent months, from hand washing to home schooling. We’ll get back to some form of “normal” eventually, but you’ll probably find some permanent marks left on your household finances.

Here are a few changes I think will be embedded in the “new normal”.


Goodbye cash

I used to take a little cash out each week to have in my wallet for those bits and pieces that it seemed silly to pay for with a card (or wave of a smartphone). But I haven’t touched my (physical) wallet in weeks. COVID will be the final nail in the coffin for cash I suspect, with people having become used to no-touch digital payment for purchases as small as a socially distanced, takeaway coffee. ATM use had halved just weeks into the coronavirus lockdown and it will be interesting to see where it settles.

There’s concern, mind you, for older and more vulnerable people who aren’t confident or capable when it comes to digital money. Talk to members of your family who may need to make the transition.


Hello home delivery

Online shopping had made serious inroads even before the pandemic. But, again, coronavirus may speed up a transition. After some initial hiccups — with shortages ranging from toilet paper to webcams — the sound of the gate opening and the soft drop of a parcel on the doorstep is now a regular part of our day. (It’s so familiar, the dog doesn’t bark anymore.)

Online grocery shopping jumped by a third in May, and clothing by 20%. Stores who didn’t see themselves as online operators are now ready, willing and able. People who lost work elsewhere are boosting the numbers of delivery people. Maybe one day soon we’ll be like China or South Korea, where consumers shop online virtually every day and where same-day delivery is the norm.


Farewell the second car

Our second car — which we had kept for the teens’ driving lessons — actually has cobwebs on it. Seriously. And dead leaves. Pay-as-you-go car insurance firm By Miles, which tracks its policyholders’ mileage in real time, mileage has decreased by 60% since late March, on top of more gradual falls in recent years. Sure, we may be getting out and about a bit more in coming months, but this is a reminder of what I’ve said before — a second car can be an unnecessary expense and an opportunity cost when it comes to using that money for something more productive. It may be time to finally take my own medicine. It’s a wagon. It’d be great for a delivery contractor.


Redo the budget

Finally, it may be time to make some permanent revisions to your household finances — even if you did it as the calendar or financial year ticked over.

We’ve decided not to go back to the gym, having developed a new home-based routine, and we discovered we’re actually quite good at cleaning the house ourselves (with the help, now, of two adult children). That adds up to a fair amount of savings each month, and the opportunity to make that money work harder — perhaps with the advice of our financial planner.

Have you thought about what you’ll keep doing — or change — post-pandemic? What will be your “new normal”?


LESLEY GREGORY is an experienced personal finance and consumer journalist, based in Sydney, Australia. She regular writes for TEBI money and personal finance issues that aren’t directly related to investing.
Here are some other articles she’s written about the coronavirus crisis:

Five ways women can boost their pay

Isolate yourself from coronavirus scams

How to do your bit for businesses in their hour of need

How to cut your spending in the crisis


You might also be interested in these other recent articles of Lesley’s:

How to avoid excessive funeral costs

What you need to know about comparison sites

Nine money rules to live by

Why you should stress test your personal finances



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