It's Beginning to Look a Lot Like a Covid Christmas
There’s no two ways about it. The coronavirus pandemic is going to influence how Canadians celebrate the holidays this year. As many of us forego beloved holiday traditions like visiting family, office parties, and traveling to warm climates, it’s clear that COVID-19 will certainly dampen the seasonal spirit. But there is still room for some seasonal cheer.
As we shop, travel, and entertain less, it’s inevitable that a COVID Christmas will have a positive effect on our wallets. In an effort to look on the bright side of things, we’ve outlined four major ways the pandemic will influence the holidays—and the positive ways those changes could affect your finances.
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Normally, the holidays are the most popular time of the year for travel but it’s pretty clear that the coronavirus has put the brakes on travel for the 2020 holiday season. It’s not just the fear of being exposed to the virus that has Canadians grounded, but also the mandatory 14-day quarantine required for all people entering Canada from a foreign destination that has clipped our wings this winter.
According to a recent Ipsos study, “COVID-19 is also having an impact on other activities in 2020, holiday related or otherwise. For example, just 5% of Canadians say they’ll travel outside of their home province for the holidays, and only 3% will travel by airplane for any reason before the end of 2020.”
With so many of us earthbound this holiday season it may be a good time to consider making better use of your travel rewards credit cards. I’m not saying to get rid of your reward credit cards; they still offer some of the best plastic earning power in Canada. While we wait to make our return to the skies, it may be a good idea to look into other ways to use your travel reward points.
In general, even with the best travel loyalty programs, your points are usually worth less when redeemed for non-travel related items like merchandise or statement credits. Given the current pandemic and the upcoming holiday season, however, I think redeeming travel rewards for other things could be a smart decision. You can redeem points for things like gift cards or merchandise, which could save you hundreds of dollars on holiday shopping. Or treat yourself and use those points towards a statement credit to ensure you keep your holiday spending under control.
If you are reluctant to redeem your travel reward points at the moment, you may want to consider using a different credit card when you shop for gifts this year to make sure you’re maximizing your earning potential. Why not look into getting a cash back card that instantly boosts your earning power as you make all those holiday purchases?
Less Last-Minute Shopping
For Canadians who are normally consummate last-minute holiday shoppers (you know who you are!), it’s very likely that COVID-19 will cure you of your procrastination habit. No one wants to be in an overcrowded store the day before Christmas during a pandemic, fighting over toys and gift wrap. It’s more important than ever to shop early—and that means planning ahead.
If you really want to avoid last minute shopping stress, you’ll need to write out a list and check it twice! Being forced to carefully plan what you want to buy is actually a blessing in disguise because it gives you the opportunity to start making a budget. Making a budget and sticking to it is one of the most popular Financial New Year’s resolutions– why not get a head start? We’ve got lots of great information on how to create the perfect budget that is sure to help you design a smart spending plan.
There are also lots of wonderful, easy to use apps that will really boost your budgeting ability, such as PocketSmith. This powerful app guides you to make better financial decisions and will help you manage your money like a pro. It’s also worth checking out other apps like Ampli, which is a money-saving app that automatically earns you cash back on everyday purchases at select merchants. If you want to be rewarded for your purchases and monitor your spending habits all-in-one, then take a look at KOHO. KOHO is a pre-paid card that’s integrated with a clever app to give you in-depth, real-time insights about your spending.
Less Shopping Overall
Yes, it’s true that you’ll likely be spending less time with extended family, friends and office colleagues because of COVID-19, but it’s not all doom and gloom. Because there will be fewer family gatherings and holiday parties, there will also be fewer opportunities for gift giving—and that’s good news for your bank account.
Speaking of bank accounts, have you thought about where you’re going to put all that money you’re going to save? A good savings account is crucial if you want to maximize your money’s growing potential. You work hard for your dollars- shouldn’t they work hard for you in a high interest, low fee saving account? Spending just a little time to research the best savings account could literally earn you hundreds of extra dollars on interest and save you an equal amount on fees as well.
Putting your money into an investment portfolio is another wise way to ensure your money grows. If you’re interested in investing but don’t have much experience or don’t have the time to manage your own portfolio, give Wealthsimple a try. It’s Canada’s most popular robo investor and the company will set you up with a portfolio that matches your investment goals. Wealthsimple will also automatically manage your portfolio for you so you never have to worry about rebalancing your investments or watching the stock market on a daily basis. And right now, if you open a new account and fund it with a minimum of $500, you’ll get a $75 cash bonus.
According to the Ipsos survey, “Regarding Christmas or holiday gatherings…only 17% of Canadians are going ahead as usual. Six in ten (57%) will reduce or modify what they do this holiday season to account for social distancing, while one quarter (26%) will cancel their holiday plans. More specifically, only one in three (33%) Canadians have plans to get together with family outside of their household for the holidays…”
Those are certainly disheartening statistics, yet despite COVID-19 causing so much loss on so many levels for Canadians, there is one thing we all have more of because of the pandemic: time.
Less of all the things we associate with the holidays—parties, traveling and family gatherings—does mean more free time, time to finally get your finances in order! We already touched on budgets, but having more time means that you could really approach this COVID Christmas as an opportunity to do a deep dive into your finances and get serious about saving and getting out of debt. Why not look into finally getting your mounting debt under control with a consolidation loan? A consolidation loan can make paying down debt less costly and much more manageable. Imagine how liberating it would feel to start the new year with a viable plan to finally get out of debt.
Make 2021 the year you start to improve your credit rating. There are numerous resources that can help increase your credit score. The Refresh Financial Secured Card is ideal for people with bad or no credit and who are having trouble getting approved for a credit card. It’s easy to get approved as long as you provide a qualifying security deposit.
There’s no denying that COVID-19 will make the holidays difficult in 2020. Though much of the holidays will be challenging, the right outlook could also provide an unprecedented opportunity to hone smart financial habits, get serious about saving money, and finally set the New Year off on sound financial footing.