How 2020 Changed the Way We Look At Money

Nicole Spector
Mature man wearing a protective mask puts a face mask on a his son in airport, supermarket or other public place.
Mature man wearing a protective mask puts a face mask on a his son in airport, supermarket or other public place.

Medieval historians hold that the worst year of all time was 536, when a bizarre fog blotted out the sun, plunging parts of Europe, the Middle East and Asia into unrelenting darkness for as long as 18 months. There was great famine, a plague pandemic, mass death and a summer so cold that fresh crops died beneath beds of snow.

The second worst year known to humankind, though not yet declared, might just be 2020. Like 536, 2020 has seen famine, bizarre weather and a plague that has killed over 240,000 Americans and nearly 1.3 million worldwide. A great fog hasn’t descended on half the planet, but hey, there’s still time.

During all this turbulence, we’ve been forced to stretch our money, stay cool during a crashing economy and figure out how to navigate our bills when income is unstable or lacking. It’s been a year of great tragedy but also one that has provided us great wisdom. Here’s a look at the key financial lessons people learned in 2020, and how they’re putting them to use going forward.

Last updated: Nov. 16, 2020

Man in business clothes takes the money cash, concept of income, bribe, bonus, wages or savings.
Man in business clothes takes the money cash, concept of income, bribe, bonus, wages or savings.

We Need More Savings

We’ve always known that saving money is important, but the pandemic really hammered home that message. Some 60% of Americans say their emergency savings won’t last through the end of the year or that they have already run out of savings, according to Clever’s COVID-19 Financial Impact Series.

“This year has taught me to have at least a year’s worth of cash reserves saved up personally and in all my businesses, because, as we’ve seen this year, even six months worth of savings to survive on is not enough,” said KC Evans, a business investor in Utah. “2020 would have been a lot easier to survive if everyone and every business had previously been more dedicated to building up an emergency savings account.”

We Have Too Many Subscriptions

“One thing I will do differently in 2021 is cut down on the services that automatically withdraw from my accounts,” said Donny Gamble, founder of RetirementInvestments.com. “We are all signed up for too many of these services and it adds up, without many of us really understanding how much they cost. I’m talking about platforms like Netflix, Crave TV, Spotify, Apple Music, fitness apps and more. I’ll even be cutting back on other subscription services I use for my business, like Ahrefs, QuickBooks and more.”

In 2019, Americans spent an average of $640 on digital subscriptions, an analysis for The New York Times by Mint found. That number might just go down when we look back next year.

selective focus of african american barista taking cash payment on bar counter in cafe.
selective focus of african american barista taking cash payment on bar counter in cafe.

Staying Home Can Save You Money

“My wife and I have accidentally saved thousands of dollars during our self-imposed quarantine simply by working from home,” said Michael Bonebright, consumer analyst with DealNews.com. “We used to make tons of incidental purchases going to and from a downtown office every day, and we’ve been kind of shocked at how much money we can save by just staying home. I do intend to return to the office a few days a week when my kids are out of virtual school, but the savings from not going every day speak for themselves.”

guy using bitcoin
guy using bitcoin

Bitcoin Is Back

Bitcoin was all the rage a few years ago — but then the buzz died down. Now, with the economy a mess, digital currency is back in favor.

“Because of the craziness that is 2020, I’m putting 33% of my assets into Bitcoin,” said Brian Robben, CEO of Robben Media. “This investment hedges against inflation, and has a limited supply of only 21 million Bitcoin. Basic economics says as supply shortens, the demand (price) rises. That’s why I trust my hard-earned money in Bitcoin.”

Read More: PayPal Finally Welcomes Bitcoin, More Cryptocurrencies

Portrait of a young businesswoman using digital tablet.
Portrait of a young businesswoman using digital tablet.

Don't Dump Stocks in Panic

If you think of 2020 as a test, one of the virtues it really doubled down on was patience. Back in late spring and early summer when the economy was bottoming out, it was difficult to remain levelheaded and not yank any investments you had in the stock market back into your wallet. Despite the unrest, folks like James Shaffer, founder and CEO of Snowlink, have stayed bullish on their investments.

“The troubled times of 2020 have made me double down on my long-standing, hands-off approach to investing — I haven’t sold any shares and I’ve maintained a slow drip into index funds and bond funds,” Shaffer said. “Especially during the pandemic, my investment mantra is, ‘No matter how good or bad the market looks, stick with it.’”

High angle shot of an attractive young woman using her cellphone while relaxing on a couch at home.
High angle shot of an attractive young woman using her cellphone while relaxing on a couch at home.

Time Is Money -- Save It

Trish DaCosta, founder of BarbellPilates.com and creator of the Barbell Pilates Sisterhood, is focusing on purchasing an investment property next year; but she’s also spending more money on goods and services that will save her time.

“Housekeeping, hiring a virtual assistant, shopping online for essentials instead of going to the store — these are the types of investments that buy back my time so I can focus on the activities that have the greatest ROI (return on investment) in my life and business,” DaCosta said.

People are stocking up toilet paper for home quarantine from crownavirus.
People are stocking up toilet paper for home quarantine from crownavirus.

Stop Hoarding Toilet Paper

Sure, you’ve heard of retail therapy, but have you heard of retail hysteria? That’s sort of what happened when the pandemic lockdowns began in March. We all hit the supermarkets and big-box retailers to stock up on goods. What did we stock up the most on? Toilet paper — as though that would save us from the end of the world. There is zero correlation between toilet paper and COVID-19, and to this day, nobody understands why humanity, when plopped in a grocery store during a global pandemic, went straight for that soft, soft double-ply.

Our appetite for toilet paper caused a shortage that we still haven’t 100% recovered from. And what happened when we feared civil unrest following the chaotic presidential election? We went and stocked up on toilet paper. Again.

This is more of an odd factoid than a key lesson, but it says a lot about our fraught relationship with money and mortality. In thousands of years, historians might look back and say, “It was a bad year for humankind, marked by plague, weather catastrophes, political unrest and a toilet paper shortage.” We might just have year 536 beat.

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This article originally appeared on GOBankingRates.com: How 2020 Changed the Way We Look At Money