Spoiler: it's not loo roll.
We don’t often like to get all serious on the Sauce, but some topics require a straight face and fewer puns about the havoc expensive breakfast foods impose on our budgets.
Amidst the Coronavirus crisis and pasta hoarding, we thought now would be the appropriate time to sit you down and talk about the birds, bees and having a financial contingency plan.
This isn’t to say create a goal in the Chip app titled ‘Black Death 2.0’, but rather stress the importance of having money put aside for the unexpected, or say, two weeks of self-isolation.
While many people have the ability to work from home, or are entitled to paid sick leave, the self-employed or contract workers are in a pickle.
So, while you can stockpile toilet paper, bathe in hand sanitiser and buy enough tinned goods to feed your great-grandchildren, we’ve put together some key points on the importance of having a ‘plague’ fund.
Why everyone should create a safety net fund
We encourage everyone to use Chip to save for the things they didn’t think were possible - the once in a lifetime trips, the fairy-tale weddings or even life-changing surgery.
However, we also encourage to use Chip to save for the much less fun things; student loans, overdrafts, emergency car repairs, health expenses and Fuck Off Funds.
Since we don’t reap gratification from putting money aside for these things, sometimes it takes something drastic to motivate us to take action - like the global spread of Coronavirus.
Adopting an ‘it will never happen to me’ mentality can jeopardise your future, and though we like to think of ourselves as a live-in-the-moment bunch, there are some things you need to plan for.
The facts on sick pay
While you may be entitled to sick leave pay, this doesn’t necessarily cover time off to care for a loved one and if your employer only adheres to the Statutory sick pay (SSP) figure, it may not be enough to cover your rent and expenses.
Currently, SSP entitles you to £94.25 a week, significantly less than the UK average weekly earnings recorded at £544 a week as of December 2019.
To qualify for SSP, you need to be earning at least £118 a week. Many people - like those on zero-hours contracts who work variable hours every week - may earn less than this. The Trades Union Congress has calculated that there are two million workers who are not eligible for SSP.
Of course if you are self-employed, sick pay doesn’t apply to you, making it even more critical to have emergency funds.
Even if you have family you could rely on to support you, at the risk of sounding grim, circumstances can change at any moment, so while we can hope for the best, expect the worse.
How Chip helps
Manually moving money towards something that doesn’t have a reward factor like that of a trip to the Greek islands often lacks discipline. Recognising this issue, automatic saves allow you to forget about it.
When you connect Chip to your bank, we are able to analyse your recent transaction history, which means if you are feeling the pinch, we’ll automatically reduce the save amount. A few pounds is better than none!
Should you stop spending?
With constant updates on death tolls and the implications the virus has on our jobs, travel plans and even concerts and sporting events amplifying our anxieties, we want to be proactive.
Trips abroad are the most popular goal made in the Chip app, so we thought we would share some useful information if you’ve been hesitating withdrawing the money stashed in Chip to book those flights.
The Foreign and Commonwealth Office (FCO) are the big dogs who advise UK nationals on where it's safe to travel abroad. As well as being a useful safety guide, this can determine whether or not you're able to get a refund or insurance payout if you’re about to go on holiday.
Your travel insurance will cover you if the FCO advises “against all but essential travel” or “against all travel”, regardless if the flight or accommodation reservation haven’t been canceled.
Currently, the FCO has only advised against traveling to China (excluding Hong Kong or Macau), two South Korean cities and a few towns in northern Italy.
In addition, the British pound to euro exchange rate has fallen to 1.1456. Though, while it is now slightly more expensive to go on holiday to Europe, it is cheaper to go to America.
While we can’t offer any official suit-and-tie financial advice, like the sensibility of washing your hands regularly (you detty pig), being particularly mindful of spending wouldn’t be a bad shout.