What To Do If You’ve Depleted Your Savings Over the Last Year
What To Do If You’ve Depleted Your Savings Over the Last Year
Gabrielle Olya February 1, 2021,
The coronavirus pandemic has led to millions of Americans losing their jobs, and oftentimes, unemployment income alone just isn’t enough to make ends meet. As a result, some Americans may have depleted all of their savings to make it through 2020.
A survey conducted by CNBC+ and Acorns last September found that 14% of Americans — up to 46 million people — had wiped out their emergency savings since the start of the pandemic. And a survey conducted by the Transamerica Center for Retirement Studies last May found that 15% of Americans had already dipped into their retirement accounts to cover living expenses, and an additional 13% planned to do so.
If you’re one of the millions of people who now need to rebuild their savings from scratch — while making ends meet in the short term without piling on debt — you may not know where to begin. Here’s what financial experts say you should do.
Build a Basic Budget
If you’re struggling to make ends meet right now, you may not have anything left over to contribute to savings. But you need to have a clear picture of your financial circumstances before you can make any moves to improve them.
“In the short term, take a look at what you have coming in, what’s going out and what’s left over,” said Andrew Meadows, senior vice president at Ubiquity Retirement + Savings. “Those are the three basic questions for building a budget. By not spending more than you have, you won’t be piling on to the debt.”
If you lost a job and are newly employed, you need to review your budget based on your new income.
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