How to Save Money During a Crisis – 8 Best Tips to Save and Earn

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The cost of living in Germany has been rising and rising. We can feel the impact whenever we go shopping or fuel our cars. It is getting more and more difficult to save money. In this article, we will talk about the 8 best tips on how you can save money during a crisis. This is not just about saving money. But also earning money passively.

A short and sweet summary

8 Best tips to save money during a crisis

Tips

Description

1. Have a budget

Know your income and expenses

2. Establish a saving habit

Save up at least 3 to 6 months of living expenses.

3. Use a savings account with a high interest rate

Earn up to 5.8% per year safely and passively with a a saving plan from Freedom Finance

4. Reduce your expenses

🔹Review existing contracts
🔹Save energy
🔹
Save on groceries by getting cashback (e.g. using a payback card)
🔹
Use a free bank account, and use the P2P service to transfer money in different currencies.
🔹
Drive less.
🔹
Use a free credit card for travel insurance and cashback.

5. Review your debt

🔹Reschedule your existing loans.

🔹Use building savings contracts to secure a low interest rate for refinancing your existing mortgages.

6. Have different streams of income

A side job, self-employed work, or getting rental income.

7. Review your investment portfolio

Diversify your investment to reduce your risk.

8. Get help

Know what social help you can get from the government if you need it.

Keep on reading for more details about each of the tips above and learn how you can save money during a crisis.


Disclaimer: The statements, comments, and other content contained in this article, even if individual issuers or financial instruments are mentioned, are not to be construed as investment advice and do not constitute, directly or indirectly, a recommendation or solicitation to invest, buy, hold or sell any financial instrument or any advice relating thereto. You are responsible for your own risk if you decide to participate in any form of investment.

Introduction

Gas and electricity prices are rising and groceries are getting more expensive. The inflation was 6.1% in Germany in May 2023! Even though the German government is planning different measures to reduce the growth rate of inflation, it is expected that the price will continue to rise in the coming future.

During a crisis time like that, it is important to monitor your finances and save money. Even though you cannot predict the future, you can take action now to prepare yourself in case of unexpected financial hardship.

Now, let’s move on to look at the 8 best tips to save money during a crisis (and even earn passive income)!

Tip #1. Have a budget

Do you know how much your monthly income and expenses are? Knowing your finance is the first step if you want to save money during a crisis.

Know your income and expenses

Making a budget doesn’t have to be complicated. You can do so even with a simple spreadsheet. Just list your income and all the expenses. Group your expenses into different categories: groceries, insurance, rent, debt repayment, etc.

Depending on the bank you use, you may sometimes find your expenses overview on the online banking platform. For example, on my online banking platform, all my bank transactions are already categorized. So, I can easily see how much I have spent in each category such as groceries or insurance.

Using this information, you can find out what kind of expenses you have and how much you are saving per month. When you have a better understanding of your expenses, you will also know what expenses you can cut in case you need to. This helps you to save money during a crisis time.

Track your expenses

In my case, I am an Amazon prime member. So, I get a free Amazon visa card. I always use this Amazon visa card for grocery shopping because I can get 0.5% cashback in the form of Amazon coupons for every transaction. As a Prime member, I can even get 3% cashback when I shop at Amazon.

At the end of the month, I have to settle the bill from my Amazon visa card. Since I use my Amazon visa card for all my grocery shopping, it is very easy for me to see how much I have spent on groceries per month. If I see an unusually higher or lower bill, I can track back what I have spent.

By doing so, I have my expenses tracked and always in control. I can also save money during a crisis because I get cashback for every transaction. Besides the Amazon visa card, some other credit cards offer cashback as well.

For more details, check this out: Free Credit Card in Germany – Top 6 For Travel and Cashback

Tip #2. Establish a saving habit

In Chinese, we have a saying which goes like this:

  • Get prepared before it rains. (未雨綢繆)
  • If everything is good now, it is time to plan for what to do when something bad happens. (居安思危)

No, we should not first start planning when bad things already happen. That would be too late.

During a crisis time, you never know what will happen. You may lose your job. Or your company may reduce your working hours. Even if that doesn’t happen, inflation can steal your money away. The inflation was 6.1% in Germany (May 2023)! Many people started to find the cost of living in Germany becoming more and more unaffordable.

So, if you are lucky and still have your job and can afford the expenses, don’t think that this crisis doesn’t affect you. You never know what can happen later. That is why it is a good time to plan now and save money during a crisis time.

Stop living paycheck to paycheck

Many people live paycheck to paycheck. So, they receive their salaries. They spend all the money. Then, they wait for the next paycheck so that they can pay for their living expenses again.

If this sounds like you, you need to think about doing things differently. It is important to set some money aside every month so that you have some savings. How much you save is not so important. The important thing is that you have a saving habit. This helps you to save money also during a crisis time.

Use a separate saving account

If you find it difficult not to use up all your salary every month, you can make use of saving accounts. Set up an automatic transfer of a fixed amount every month to your saving account from your salary. This is a good way to make sure you save money during a crisis because saving is done automatically.

Some banks such as Tomorrow or BUNQ also offer sub-accounts that help you to manage your saving goals easier. You can set up your saving goal and put your money in a separate sub-account.

For more info about some best banks to use, check this out: Opening a Bank Account in Germany – 5 Best Bank Accounts With English Services

How much should you save during a crisis?

As a thumb of rule, you should save an amount equal to at least 3 to 6 months of your living expenses. This saving amount can act as your emergency fund. The amount should remain liquid so that you can use it easily in case of an emergency.

You should not touch your emergency fund if it is not necessary. However, in case of an emergency, this money can help you with your day-to-day living expenses.

That is why it is important to make a budget. Without a budget, you may not have a clear view of the amount you are spending. So, it would be hard to calculate how much emergency fund amount you need.

If you are a super saver and you have already saved more than 3 to 6 months of your living expenses, you may want to think about putting that extra money into your investment. The emergency fund should stay liquid for your emergency need. Other extra savings should be put into investment so that you can grow your wealth.

Not sure what to invest? Check this out: Invest in Germany as a Foreigner – Best English Guide

Tip #3. Use a savings account with a high-interest rate

What to do with your emergency fund?

During a crisis time, you should save up some liquid money as an emergency fund. This fund can help in case you lose your job or experience other unexpected events. As a rule of thumb, an emergency fund should be at least 3 to 6 months of your living expenses.

So now, you have saved up your emergency fund. What should you do with it when you don’t need to use the money now?

Putting in your bank?

Letting the fund sit in your bank account may not be the best solution. As you already know, inflation was 6.1% in Germany (May 2023). This is a lot of money to lose by just putting the sum in your bank.

How about investing the money?

The thing is that an emergency fund needs to be liquid. This is to ensure that you get the money you need when you need it. Most high-yield investment requires you to put the money for the long term. This is not something you want to do with your emergency fund.

How about investing it in stocks?

Even though stock investment is liquid, the stock market is volatile. You may have to sell your stock at a loss in case you need to cash out urgently.

How about an instant-access savings account?

This kind of account is very liquid. However, you can only earn 1-2% of interest currently. The return is almost nothing.

How about getting up to 3% interest per year while you can access your money at any time?

In this session, I would like to demonstrate an alternative to a bank deposit: the savings D-account.

What is a savings D-account?

In my previous article, I talked about how you can buy stocks at IPO price in GermanyFreedom Finance is the only EU broker that allows customers to buy new stocks at the IPO price.

Now, this is getting interesting. Freedom Finance also has a savings account (D-account) with a fixed interest rate of 3% per year on the balance in USD, or 2.5% per year on the balance in EUR.

As you know, in Germany, current accounts usually do not give you much interest (or if anything at all). So, the 3% offer from Freedom Finance is a much better rate than what most banks in Germany can offer. In addition, the interest is accrued daily. And you can take out money at any time you want.

Why does Freedom Finance offer a savings D-account?

Freedom Finance is a broker that lets you trade in stocks, ETFs, futures, and options on major US, European, and Asian stock exchanges. Besides, you can also buy stocks at IPO price via Freedom Finance.

All clients of Freedom Finance Europe have a D-account. It is created automatically immediately after the main trading account has been opened. If you want to buy stocks at IPO price or make a trade, you can transfer money from your D-account to your trading account in just a few clicks. The money will be received instantly.

On the other hand, if you sell your stocks and want to wait for the next best time to invest again, you can transfer your sale proceed from your trading account to the D-account.

This is a big advantage for investors especially if they want to trade US stocks without currency conversion. It is handy to keep USD to buy shares and transfer available funds to a D-account.

With the D-account, you can carefully invest and receive passive income at the same time. The D-account ensures that your money is always working for you instead of sitting idle and waiting.

Where does the 3% yield come from?

Since Freedom Finance is not a bank, but a broker, calculations are made at the expense of currency exchange operations on the funds of the company. Clients simply receive passive income at the expense of Freedom Finance Europe.

This is secure because Freedom Finance Europe is classified as A (very low risk) by CreditSafe. The broker is fully compliant with the MiFID II, a regulatory framework that ensures the highest investor protection level possible. Besides, Freedom Finance is also reported to BaFin and CySEC regulators in EU, and (as a part of international holding) to SEC in USA

What if you don’t want to trade?

No problem. You can just use the D-account as an alternative to a bank deposit. You can enjoy the 3% USD/ 2.5% EUR return even without trading. This annual interest rate is fixed and guaranteed. This is a great way for risk-averse investors to get passive income daily.

How do you open a savings D-account?

D-account opens automatically when you open a confirmed account with Freedom Finance Europe Ltd. You can deposit money to your account in any convenient way: credit card, bank transfer, or transfer from account to account.

Interest begins to accrue from the minimum amount on the D-account of 150 EUR/USD. There is no upper threshold.

Does the savings D-account have any downside?

Currency conversion

The 3% interest applies only to the USD currency and starts from $150 at the balance. However, due to the high fixed interest rate of 3%, your interest return will likely cover any possible currency conversion costs.

You can use the Freedom24 website to convert your EUR to USD if needed. Or you can use the mobile app to perform the currency exchange, and then transfer the USD to your D-account. If you want, you can also top up the D-account directly with USD (which can be more profitable).

If you want to earn passive income in EUR, the interest rate is 2.5% and it starts from 150 EUR.

Withdrawal

To withdraw money from your D-account, you need to first send money from the D-account to the trading account. You can then withdraw the money from the trading account to your personal bank account with a fee of 7 EUR/USD. The withdrawal process will take 1 to 5 business days.

Safety

It should be understood that the Freedom Finance savings account is not a bank savings account. Unlike state banks, it is not insured by the government. However, your savings in Freedom Finance are insured by ICF (investor compensation fund) for up to 20 000 EUR together with the assets in your investment account.

What if you want to earn more interest?

Freedom Finance offers also long-term saving plans, where you can earn up to 5.8% yearly interest with your USD balance, or 3.6% with your EUR balance. This is a very good interest rate compared to many other banks in Germany. 

You can choose 3, 6, or 12 month plans. The minimum deposit amount is 1000 EUR or USD. And there is no maximum limit.

Conclusion

The fact that you can passively save for up to 5.8% and combine this with investing is a unique offer. And in combination with the IPO of large brands, this is a great way to save and increase savings by making money work for you.

Click here to open a savings D-account now!

Freedom24 by Freedom Finance
Disclosure: If you click this link and make a purchase, we will receive a small commission at no additional cost to you. Buying stocks at IPO prices may involve additional restrictions.

Tip #4. Reduce your expenses

It is best to reduce your expenses during a crisis time. As the market is very unstable and we cannot predict what will happen next, your savings can provide you a safety nest in case of unexpected situations. Reducing your expenses help you to achieve higher savings.

Below are some examples of how you can reduce your expenses.

I. Review your existing contracts

Unsubscribe unnecessary services

Reducing your expenses doesn’t have to be difficult. Sometimes you may not even need to lower your living standard. The easiest way is to start by reviewing your existing contracts.

Look at your bank statement and review any recurring payments. Sometimes, you signed up for some services a long time ago. And you may not need those services anymore. Since your bank is charged automatically every month, you may not even remember that you are still paying for those services.

Have you subscribed to magazines that you don’t read anymore? Are you paying for any apps that you don’t use? For certain services, do you really need to have the premium version? Or maybe a basic one is already sufficient?

Unsubscribing unnecessary services can help you save quite some money during a crisis without lowering your living standard.

Looking for a cheaper alternative

Streaming service

Sometimes, there are services that you still need and do not want to unsubscribe from. However, you may be able to find cheaper alternatives that provide similar services.

One example is streaming services. Are you paying for both Netflix and Amazon Prime videos? How often do you watch them? Can you just keep one of them instead of paying for both?

Do you know that some other streaming services are cheaper or even free? Check this out: Streaming in Germany – 11 Ways To Do It Legally

Gym membership

How often do you go to the gym? Maybe you want to cut your subscription if you are not there often? Maybe other smaller gyms are cheaper?

How about using an app at home instead for your workout? Or you can go jogging/ biking outside instead of exercising inside your gym?

Mobile phone contract

If you are paying a lot on your mobile phone contract now, you should review if you still need to keep your expensive contract. Nowadays, there are many mobile phone contract that costs only a few Euros per month. And these contracts may be sufficient for your daily needs already.

If you only need very low usage like me, consider going SIM-only. This is what I do. I pay more or less 0 EUR every month because I stick with a Wi-Fi connection most of the time.

For more details, check this out: Best Mobile Operator in Germany – Compare the Top Plans

Internet contract

Similarly, your internet contract can be another big regular expense per month. You should review it to see if you can get a cheaper contract. Always compare the best rate in the market when your contract is going to end. It is unlikely for you to get the best deal if you simply renew your existing contract.

Here is our trick to get a big discount from our existing internet provider: Best Internet Providers in Germany – Top 4 Comparison

II. Cut unnecessary expenses

Identify what expenses are essential. Cutting unnecessary expenses and changing your lifestyle can have a huge impact on your savings. Here are some ideas:

Shop less

During a crisis time, you should save money by shopping less. Before buying anything, ask yourself: do you really need it?

Have you ever bought clothes that you wore only once (or never)? If you sort your wardrobe, maybe you will find clothes that you can still wear but you just totally forgot about them.

Another great way to save on shopping is to buy second-hand. Recently, I sold my high-quality dryer for only 200 EUR because I have to move and cannot bring it with me. The dryer costs 600+ EUR if you buy it new.

You can find great deals like that on websites such as ebaykleinanzeigen. People want to get rid of their expensive electronic appliances because they are moving. Sometimes, they even give out the appliances for free.

If you are looking for other second-hand stuff, going to a flea market is a good idea. Just search in google “Flohmarkt” in your area. You can find anything you can imagine in a flea market, at a super low price.

Eat out less

Eating out in Germany can be expensive. If I go out for dinner with my husband, we can easily pay 50-60 EUR for a meal. If I eat out with my whole family (my husband plus 2 kids), the bill can get to 80 EUR easily.

Imagine if we do it once a week, we will spend around 300 EUR per month. And my grocery bill per month is 350 EUR. Do you see how expensive it is to eat out?

So, we limit ourselves to only eating out once or twice per month (at most). This helps us to save a lot of money during a crisis time. Besides, we usually take away instead of eating inside the restaurant. Taking out is much cheaper because we don’t have to buy drinks in the restaurant. We have every drink we need at home.

Cut entertainment

If you are looking to save money during a crisis, entertainment expenses would be the first thing to cut. Instead of going to a cinema, you can watch Netflix at home. Instead of going out to a restaurant for a dinner party, you can invite people to your home for a board game evening. You can always find a cheaper alternative while hanging out with your loved ones.

III. Save energy

As you know, energy is getting more and more expensive nowadays. Saving energy doesn’t just mean saving your wallet, but also our planet. Some easy ways to save energy:

  • Turn off the lights if you don’t need them.
  • Use LED bulbs (85% less electricity when compared to conventional lighting)
  • Turn off your appliances instead of letting them on standby
  • Turn down your heating
  • Hang your clothes instead of using your dryer
  • Use less warm water, e.g. use cold water when washing hands, and wash your clothes with colder water if possible

For more tips about how you can save on your energy bill, check this out: Electricity in Germany – How to Save Money and Find the Best Provider

IV. Save on groceries

Going to discount supermarkets like Lidl and Netto can save you money compared to other supermarkets such as Rewe and Edeka. Depending on which supermarket you usually visit, you may want to apply for a payback card or a Deutschland Card. These cards give you cashback when you do grocery shopping. I saved 80 EUR worth of points after using my payback card for a year.

If you are shopping at a supermarket, try to look for things on the lower shelves. They are usually cheaper. Besides, try to buy supermarket brands such as Ja! (from Rewe) or the Edeka brand. They are cheaper compared to other brands.

Some supermarkets also sell products that will be soon expired at a discounted price. For example, in the Edeka I usually go, there is always a big cart full of soon-expired products next to the cashier. These products are very cheap compared to regular ones.

For more tips about saving on groceries, check this out: Supermarkets in Germany: What to expect and how to save money on groceries

V. Save on bank fees

Do your bank charge you fees? If so, you may want to switch to another bank account that doesn’t charge you. You can find different bank accounts to use here with English service: Opening a Bank Account in Germany – 5 Best Bank Accounts With English Services

If you need to transfer money with different currencies, avoid using bank transfer. Use a P2P transfer service such as Currencyfair or Wise. They use the real exchange rate (from Google) when you convert other currencies into Euros. You can save loads of money by doing so.

Currencyfair is also offering 10 free transfers to our readers now if you want to try it out for free.

currencyfair get 10 free transfers
Disclosure: If you click this link and make a purchase, we will receive a small commission at no additional cost to you.

For more details and different options to transfer money to Germany, check out this post: Transfer Money Internationally – Best Ways To Send Money To Or From Germany

VI. Save on fuels

Before getting into your car, consider if you really need to drive or not. Maybe you can walk or bike to your destination? Or maybe it is cheaper if you take public transportation?

It is not just the fuel is expensive. But parking can be expensive too. Driving less also means a lower mileage. It reduces depreciation and preserves the value of your car.

If you really need to drive, then try to reduce the number of trips by combining different destinations in one trip. For example, I always go grocery shopping after work. This way I can go to a supermarket on the way back home from my office.

VII. Review your credit cards

How many credit cards do you have? Do you really need all of them? Are you paying fees for your credit cards?

If yes, you may want to consider cutting your credit cards or changing them to another bank. There are free credit cards in Germany that give you cashback or even travel insurance.

For more details, check this out: Free Credit Card in Germany – Top 6 For Travel and Cashback

VIII. Contribution to your pension

If you have a private pension plan in Germany such as Riester-Rente, you should not cut your contribution unless it is absolutely necessary. Of course, in case of financial hardship, it is possible to reduce your contribution.

For example, during my parental leave, I reduced my contribution to the Riester-Rente to 20 EUR per month because I didn’t receive my salary during that time.

So, if you have financial difficulties, you can adjust your contribution amount. However, I would avoid doing so unless it is absolutely necessary. Even though the contribution to your pension plan affects your current cash flow negatively, it is not really an expense. It is an investment for the future when you retire.

So, once your financial situation improves, don’t forget to resume your contribution again. If you have Riester-Rente like me, you should contribute at least 4% of your annual income (with a maximum of 2,100 Euros per year) to get the maximum government bonus. These are free money from the government! So, it is a no-brainer to get the maximum amount if you can afford to pay the contribution.

For more details about private pension plans in Germany, check this out: Invest in Germany as a Foreigner – Private Pension Plans

Disclosure: If you click this link and make a purchase, we will receive a small commission at no additional cost to you.

Tip #5. Review your debt

Getting a loan

There are many different types of loans in Germany. If you plan to get a loan, make sure you select the correct loan types. For example, you should get a car loan if you plan to buy a car; or a mortgage if the money is for your property. Choosing the correct loan type ensures that you get the best interest rate.

For more details about loans, check this out: Loan in Germany – How to Get a Personal Loan (+ Best Offers)

Avoid high-interest loans

It is important to avoid high-interest loans unless it is absolutely necessary. For example, credit cards usually have very high interest rates (double digits). Even though the interest may not look too much if you only have a small debt, your interest payment can easily add up to a larger amount in the long term.

If you already have high-interest loans, focus on paying them off now. During a crisis time, you need to prepare for the worst. You may lose your job. Or the interest rate may increase significantly. All these can affect your ability to pay back your debt.

Do you have more than one loan?

If you have more than one loan, you may be able to save money during a crisis by combining them into one bigger loan. Rescheduling your loan (Umschuldungskredit) may help to lower your monthly payment and your interest rate. Besides, since you only have to pay one loan instead of several, it will also be easier for you to track your finances.

Are you paying a mortgage?

If you have bought a house in Germany and are paying a mortgage, you probably know that the interest rate has been increasing fast. In our case, we have 3 properties and several mortgage contracts for each property. Many of our mortgage contracts have a term of 10 years. It means that once the mortgage term ends, we will have to look for follow-up financing.

As the interest rate is expected to go up, this puts a lot of pressure on us. We bought our property a few years back when the interest rate was extremely low (about 1%). With the current interest rate development, we will likely need to pay a 3 – 4% interest rate when our mortgage term ends. If that is the case, our mortgage repayment amount will be completely out of our original budget.

If you are facing the same worries, it is good to know that there is a way to get around that. I was so glad that my financial adviser gave us the solution: the building savings contract (Bausparvertrag).

How do building savings contracts work?

The building savings contract consists of 2 phases: the saving period and the mortgage period. The saving period usually lasts for 7-10 years. You will pay monthly into a saving account. The interest you get from this saving account is very low.

Once the saving period is over, you can enter into the mortgage period. By then, you will have probably saved up 30-50% of your desired finance amount. So, you can use the money from your saving account to pay partly your desired finance amount.

For the rest 50-70%, you will get a mortgage. This mortgage then works similarly to other types of mortgage. You will have to pay both the principal and the interest rate. The good thing is that the interest rate can be very low.

What are the advantages of the building savings contract?

If you know you need a certain amount of money in the future, you can plan it already now. In our case, we know that our mortgage term will end in a few years. And we know that the interest rate will likely go up by then.

At the moment, we pay about a 1% interest rate for our existing mortgage contract. Since we don’t want to have a much high monthly repayment in a few years, we can get a building savings contract now and start the saving period.

Even though the interest of the saving account is very low, we can secure also the low interest rate once we enter into the mortgage period. Our building savings contract is structured in a way that the saving period ends at the same time when we need our follow-up finance.

So, once our existing mortgage term ends, we will have to save up some money to pay off part of the loan. For the rest of the loan, we will enter into a mortgage period that offers a very low interest rate of less than 2% (thanks to the building savings contract).

In short, the building savings contract can help us to secure a very low interest rate for the future. It allows us today to plan our finance in the future.

Another good thing about the building savings contract is that you don’t have to enter into the mortgage period if you don’t need to. If you want, you can simply take out the money from your saving account after the saving period. It is your own money and you can use it in whatever way you want.

For more details about building savings contracts, check this out: Mortgage in Germany – English Guide (Plus 6 Best Tips!)

Need help refinancing your mortgage?

If you want to see whether a building savings contract is for you, or if you want to learn about other options to refinance your existing mortgages, I would highly recommend my financial adviser to you.

We got all our mortgage contracts via our financial adviser. He does not work for a specific bank. Instead, he compares the best offers in the market and gives us independent advice. Besides, he speaks excellent English, which is perfect for expats like me.

If you are interested, you can contact my financial adviser and mention my blog “My Life In Germany” to get a free English consultation. You can save a lot of money with a suitable contract and proper planning.

Tip #6. Have different streams of income

Diversify your income

Relying on only a single stream of income can be risky. If you lose your job, you may not be able to pay for your living expenses anymore. So, if you can, you should diversify your income.

One way to add another stream of income is to do a side job. For example, a weekend job as a bartender. Or as simple as babysitting, tutoring, or teaching a musical instrument.

Read also: 9 ways to earn money in Germany as a student

Rental income

Adding another stream of income doesn’t necessarily mean that you need to have a second job though. You may also think about getting rental income if you have an extra room to rent out.

If you can afford it, you may also think of buying an investment property. That is what we have done. For more details about how to do it and all the tips and tricks, check this out: Real Estate Investment in Germany – How We Became Landlords.

Self-employed work

Another way to diversify your income is to do self-employed work if you have specific skills. For example, you can be a freelance writer online if you have good writing skills. Similarly, you can also provide translating, website design, or consulting services if you process the right skills.

For more different ways to earn money, check this out: 20 Ideas to Make Money from Home – Anyone Can Do

Doing freelance jobs doesn’t just increase your income. You may even develop a new interest that might become your future career.

Tax impact

While it is great to diversify your income, don’t forget about the tax implication. German tax can be complicated and you will have to report all the different streams of your income in your tax return.

For more info about the tax return, check this out: Tax Return in Germany – Best English Guide

If you have tax questions based on your individual situation, you can use Yourxpert to get a free online initial assessment from a tax adviser.

Simply write your question in the below question box to get a free online initial recommendation from a tax adviser. If further actions are needed, you will get a non-binding offer with the price and you can decide if you want to go for it.

 

Tip #7. Review your investment portfolio

As mentioned before, you should save at least 3 to 6 months of your living expenses as your emergency fund. But that doesn’t mean that you should not invest anymore. If you have extra money exceeding your emergency fund, it is good to invest the money instead of letting it sit at your bank.

There are many different ways to invest your money in Germany. To learn about the different ways and their pros and cons, check out these articles:

The key to investing is diversification. Diversifying your investment is even more important during a crisis time. The stock market will likely crash during a recession. But certain industries may be less vulnerable during an economic downturn, e.g. the healthcare industry. So, if you are investing in stocks, make sure you have a diversified portfolio with investments in different industries and countries.

Besides diversifying your stock investment, it is also important to diversify the type of your investment. For example, you may want to invest in different assets including stocks, bonds, pensions, real estate, etc.

Certain types of investment are more vulnerable to economic downtown. That’s why diversifying your investment helps you to reduce your risk during a crisis time. Don’t put all your eggs in one basket!

Tip #8. Get help

The good thing about living in Germany is that there is a good social system. You may be eligible to get social help from the government in case of financial hardship.

For example, in case you lose your job, you may be able to get unemployment benefits. And if you do not have enough money to meet your basic needs, you may try to apply for Hartz IV.

You can check out this article to get familiar with the eligibility and the application processUnemployment Benefit in Germany – Application Guide for Expats

Conclusion

You cannot control what will happen during a crisis. But you can control how you manage your finance. If you do the proper preparation, it can help you a lot in case of unexpected situations such as job loss. Follow the 8 best tips in this article. You can still save (and even earn) money during a crisis.

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DISCLAIMER

Please be aware that this article is intended to provide you with a general overview of how to save money during a crisis. It is for informational purposes only.

The statements, comments, and other content contained in this article, even if individual issuers or financial instruments are mentioned, are not to be construed as investment advice and do not constitute, directly or indirectly, a recommendation or solicitation to invest, buy, hold or sell any financial instrument or any advice relating thereto. You are responsible for your own risk if you decide to participate in any form of investment.

Please note that no investment can guarantee a profit. Every investment is associated with risks and can lead to a complete loss of your invested money.

You are responsible for your own risk if you decide to participate in any form of investment. Any losses you may incur are your responsibility. You should consult a qualified professional before making any financial decisions. Our blog makes no guarantee as to the accuracy or timeliness of the information in this article.

This blog is not a financial consultant by law and we do not accept any form of liability resulting from reading this article. We cannot give you investment advice or financial services.

If you need more details and specific advice on your personal situation, we would highly recommend you to consult a financial adviser and a tax adviser.


How do you save money during a crisis? Leave a comment below to share your tips and experience!

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About the author

Originally from Hong Kong, Sindy spent 13 years in Germany before moving to the US. Her blog is your ultimate resource for navigating Germany, offering pro tips on bureaucracy, job hunting, education, culture, family life, and more.

With a "been there, done that" attitude, Sindy, a certified public accountant, draws on her extensive finance and accounting background to provide professional insights with a friendly touch.

Having navigated German life with her German husband and raising two kids there, Sindy brings a personal touch to her advice. Let this blog help fellow expats like you navigate the ins and outs of life in Germany!

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