Finances FYI Presented by JPMorgan Chase
We’ve long known how animals prepare for a season of hardship. As fall slips into winter, plants shed their leaves and flowers to slip into dormancy, while animals and insects burrow underground or tuck themselves into hidden nests and caves for the coming months.
During those months, hibernating animals will rely on the fat and energy they’ve stored through the rest of the year to provide fuel and heat through the winter, when their bodies cut back on many functions.
If you’re reading this, you’re not a tree or a bear, so you probably won’t spend the coldest months of the year actually hibernating or dropping your leaves. But along with living through the actual winter every year, you probably regularly encounter financial and economic winters when nature’s cold-weather lessons could help carry you through.
Here’s how hibernation and dormancy practices from the natural world could help you prepare for and weather your next season of financial hardship.
Cutting Back for Winter
When animals hibernate for the winter, their bodies slow down to keep up only the most necessary functions. Brumating turtles, buried in the earth through the winter, can survive on no food and barely any oxygen as their bodies and brains enter a period of inactivity.
Despite the winter season of inactivity, hibernating animals emerge having retained much of their mobility, muscle mass, and bone density. Their pared-back existence helps them survive until spring, when they emerge little the worse for wear.
Like hibernating and brumating animals, you can weather periods of financial hardship by cutting back on nonessentials. While animals’ bodies naturally shut down specific processes, you can learn to practice financial discipline and cut extra expenses after you lose a job or experience a financial emergency.
Here are some tools to have on your side when you need to shed the extras and pare back for the financial winter — even if it hasn’t hit yet:
- Sign up for subscription-tracking tools like Rocket Money, which can help you keep an eye on all your regular subscription expenses (even the ones you’ve long forgotten about). Once you have an idea of your monthly payments, make a tiered list of your regular expenses, sorted from most important (your monthly utility bills, rent, and grocery costs) to things that could be cut if needed (entertainment subscriptions, meal delivery services, or dining out). When financial hardship hits, you’ll immediately know where you can afford to cut back.
- Optimize your spending on utilities. Water, gas, and electricity are inescapable expenses, but you can pare back on your use — and ultimately, your spending. When times are good, consider investing in home updates that will ultimately save you money and resources, like water-saving showerheads and toilets, smart thermostats and lights, and home insulation upgrades. Research your energy provider’s peak and off-peak hours, and practice using your major appliances during off-peak hours, when energy costs are lowest and your utility provider may incentivize use.
- Familiarize yourself with the most financially effective spots to grocery shop in your area and practice couponing with circulars. While you may currently have the money to shop at higher-end grocery stores or splurge on grocery hauls, buying food can be a massive expense when you’re financially struggling. If dining out is a special experience for you, learn which local restaurants offer weekly or special occasion deals that could allow you to hold onto this habit when things get hard.
Stocking Up for Hibernation
When animals enter a season of hibernation, they usually don’t do so on a whim. Instead, creatures from bears to ladybugs spend the plentiful, above-ground months gorging on prey and fattening up for the coming winter months.
While financial emergencies aren’t as predictable as an annual winter, we can take a lesson from the natural world’s winter preparedness. Here are some ways you can fatten up your own reserves before you hit financial hardship:
- Build a deep pantry. When you’re financially stable, use each trip to the grocery store to grab a few extra shelf-stable foods you know you enjoy or household essentials you regularly use, like toilet paper, menstrual products, paper towels, cleaning products, and detergents. You don’t have to grab all of these at once — just think about adding one or two extras for the future to each grocery shopping trip. If you notice a sale on a splurge item like steaks or fish, grab some for the freezer. If you want to go the extra mile for yourself, plan a food prep weekend to make freezer-stable meals for your future self.
- Practice saving. Whether you have plenty of cushion or end each month with just a little extra money, saving now could help you get by in tougher times. Even if you’re adding $5-10 per paycheck to your savings, you’ll be setting aside money you wouldn’t otherwise have when things get hard.
- Buy off-season. When a new season arrives, you’ll usually need to add a few new items to your wardrobe, whether you need to replace your summer jean shorts or buy a new pair of snow boots. Look for off-season deals on expensive seasonal items like jeans, coats, shoes, and more, buying in the spring and summer for winter and in the winter for summer. Planning ahead will not only help you save when you buy, but may ensure you have the seasonal clothes you need, even if future financial hardship hits.
Your personal financial hibernation probably won’t involve slowing your heart rate and breathing to survive the cold, but you can use nature’s savvy preparation and endurance skills to make it through your next financial winter. Happy hibernating!
Finances FYI is presented by JPMorgan Chase. JPMorgan Chase is making a $30 billion commitment over the next five years to address some of the largest drivers of the racial wealth divide.
