Apr 14, 2020

Creating a budget for uncertain times

By AYCO, a Goldman Sachs Company

Disruptions to your income can feel uncomfortable, but there are ways to manage through them. Many families are navigating a change to their income as the world faces unprecedented times.

Periods of economic volatility can impact your regular income, leaving your everyday budget vulnerable. Now is the time to take stock of your finances and create a budget that works for you. There are a few simple things you can do to get started.

Identify and quantify your income and expenses

Before you can create your budget, you need to know what you have to work with. Think of this step as a simple equation. Add up your income and then subtract your expenses.

Translating your life into a list of income and expenses may seem overwhelming at first, but it’s well worth it. Add your different sources of income together and then subtract each expense. Ayco provides resources for clients, or you can perform a quick search online to access templates or tools.

If your expenses are higher than you expected or feel comfortable with, try to reduce spending where possible. To lower your expenses, you could:

  • Apply for any federal, state or local financial relief that you might be eligible for as it becomes available
  • Consider refinancing to a lower rate
  • Make more meals at home rather than ordering takeout
  • Try a DIY approach instead of paying others to fix things around the house. There are plenty of online resources to help you along
  • Save as you shop with coupons and special offers
  • Set monetary limits for yourself on coffee, snacks, etc. for each week
  • Save on energy bills by turning off lights and appliances when not in use

Consider your financial goals

Whether you just want to better understand your cash flow, are trying to pay down debt or want to build up your emergency fund, budgeting can help you get there.

Look back at the difference between your expenses and your income. If you find yourself with extra money at the end of each month, it’s money you can put toward your goals. Even if the amount seems small now, it could make a big difference in the long run.

Tip: To make saving for your financial goals even easier, try setting up automatic payments. For example, if your goal is to add to your emergency fund, you may be able to set up a direct deposit from your paycheck to this account.

Create your budget—and stick to it!

Building a monthly budget is simply the first step. It may take some getting used to, but once you’ve been following your budget for a few months, you’ll start seeing the benefits. And if it doesn’t seem to be working, you can always adjust as needed.

Budgeting can pay off in normal times, but it is critical in times of uncertainty. A good budget will help you meet your everyday expenses, discover new ways to save money and stay the course for your long-term financial goals.

Want to learn more? Check out other articles from AYCO on financial planning and more.

Ayco Logo Blog Author v2

AYCO, a Goldman Sachs Company


This material was prepared by The Ayco Company, L.P. an affiliate of United Capital Financial Advisers, LLC d/b/a Goldman Sachs Personal Financial Management (“GS PFM”). This material was prepared for informational purposes only and should not be construed as personal financial planning, investment, tax, accounting, or legal advice. No investment decisions should be made using this data. GS PFM believes the material used for the article is accurate, but does not verify its accuracy independently and does not warrant or guarantee that is it accurate or complete. Information and opinions expressed in this article are as of the date of this material only and subject to change without notice. © 2020 The Ayco Company, L.P., a Goldman Sachs Company. All Rights Reserved.

United Capital Financial Advisers, LLC d/b/a Goldman Sachs Personal Financial Management (“GS PFM”) is a registered investment adviser and an affiliate of Goldman Sachs & Co. LLC and subsidiary of The Goldman Sachs Group, Inc., a worldwide, full-service investment banking, broker-dealer, asset management, and financial services organization.

The information contained herein is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered investment advice. GS PFM does not provide legal, tax, or accounting advice. Clients should obtain their own independent legal, tax, or accounting advice based on their particular circumstances. Please contact your financial adviser with questions about your specific needs and circumstances.

Information and opinions expressed by individuals other than GS PFM employees do not necessarily reflect the view of GS PFM. Information and opinions expressed in this article are as of the date of this material only and subject to change without notice.