The Pandemic Inspires a Focus on Saving
How a Houston entrepreneur rebooted her financial plan due to COVID-19
The COVID-19 pandemic has set many Americans on a course they never expected, whether that involves working from home while trying to help kids with virtual classes, coping with job loss or caring for a loved one who is ill. At the same time, the events of 2020 have compelled many to take a close look at their finances and reconsider their plans. In fact, spending less and saving more are Americans’ top financial New Year’s resolutions according to a recent survey conducted by the Harris Poll on behalf of Empower Retirement and Personal Capital.
Take Steffa Mantilla for example: Before the virus broke out in the U.S. and changed daily life for millions of Americans, Mantilla ran two businesses from her Houston, Texas, home while caring for her toddler. One was a financial advice website, where she shared resources and advice on budgeting and paying down debt. For the other, she put her experience as a zookeeper to use and offered animal training as well as pet-sitting and dog-walking services.
Mantilla and her husband have tackled some major financial goals over the years, such as paying off significant consumer debt. In early 2020, they were working on another ambitious plan: paying off their mortgage. She was making extra payments to help them reach that goal faster. But in March, the pandemic put a swift end to her pet-sitting side hustle. “Everyone was at home, so they didn’t need a mid-day dog walker, and no one was going on vacation,” she says.
At the same time, her husband’s income dipped. While he continued to earn a base salary, he lost the commission-based earnings he counted on from making in-person sales calls. Fortunately, even with the financial hit, the couple had enough income to cover their needs. But they decided to rein in their spending and put their extra mortgage payments on hold.
“I’m a planner,” Mantilla says. “I definitely like looking ahead and preparing.” But amid a pandemic, doing so became more difficult. The best course of action, she decided, was to work on beefing up their savings, “because I honestly don’t know what the future holds.”
The couple wasn’t starting from scratch — they already had an emergency fund that would cover about four months of expenses. But the sudden drop in their income plus the overall economic uncertainty highlighted the importance of keeping extra savings on hand.
For now, Mantilla plans to keep padding their emergency fund until it can cover at least six months’ worth of expenses. And she’s working on replacing some of her lost income by offering new products, such as pet-training guides.
One day, when the family’s income stabilizes, Mantilla says she’ll get back to paying ahead on their mortgage. But in the meantime, increasing their cash buffer feels like the right move. Now, she’s no longer stressing about potential scenarios that could strain their finances. “Building up our savings helps a ton with mental well-being,” she says. “It has been a huge sense of relief.”
Read more about how Americans are planning to move financially forward in 2021
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