Americans took on new expenses throughout the pandemic, from exercise trends to personal protective equipment. As COVID-19 cases decline, so may these “new normal” purchases.
As COVID-19 numbers decline and life in the U.S. begins to resume in the newest version of normal, consumers are starting to tally all the things they bought during the pandemic. The extra expenses extended well beyond face coverings.
Here are nine products and services that surged in 2020. Now, if not soon, the cost of these line items can go back into your budget, with the money going to reduce past debt, enjoy the present and save for the future.
1. Home fitness equipment
Companies that manufacture exercise products enjoyed healthy profits during the pandemic. Peloton, for example, saw its year-to-year sales spike by 232% in 2020.
If that equipment is already collecting dust or you’re eager to return to the health club instead, consider selling it on the secondary market, so it’s not a total loss. Consider buying exercise classes in bulk, says budgeting expert Andrea Woroch. “Instead of a monthly fee that goes on your credit card, get a punch pass where you purchase individual classes that you can take any time. They won’t go to waste if you end up not going. The more you buy at once, the bigger the discount.”
2. Delivery service fees
To abide by shelter-in-place mandates and reduce the chance of COVID-19 exposure, millions of people turned to shopping and delivery apps. With this mobile technology, ordering everything from groceries to drugstore items became a breeze. The price was steep, however. In February 2020, The New York Times warned readers that the fees imposed by such apps as DoorDash and Postmates increased prices by up to 91%.
“You don’t need to have everything brought to you anymore, so you may want to break this expensive habit,” says shopping expert Trae Bodge. But if you really love these apps or need to continue with them, she suggests opening a credit card account that offers credits for meal delivery services, such as The Platinum Card® from American Express. Just make sure you only charge what you can afford to quickly repay or the interest on revolving balances will nullify the savings.
The pandemic forced employees and students to work and study remotely, which resulted in a shopping rush on all kinds of essential electronic devices. For example, market research company Canalys reported that personal computer sales, long thought to be on the extinction list, experienced its first big growth in a decade.
Having high-functioning electronics is important, but if you charged these expensive items and are paying over time, interest charges are probably racking up. In that case, take inventory of the products you may have replaced. “Most people still have their old phones and laptops, but there’s no reason to keep them,” says Woroch. “Gather them all up and sell them on sites like eBay and Decluttr. Use the money to pay down your credit card balance.”
4. Takeout food
When only essential businesses were allowed to operate, indoor dining ground to a halt. Drive-through fast food, sidewalk pickups and home deliveries took up the slack. According to a Bloomberg Second Measure survey, meal delivery service sales grew 116% year-over-year in March 2021.
Why did takeout soar in popularity when people remained close to their kitchens? It was more convenient, especially for parents whose kids were home from school and had to juggle duties, says Lauren Greutman, a budget coach and single mom of four. But even pizza and fast food can be more expensive than homemade, so explore ways to prepare meals economically and easily. “Plan your menu in advance, cook in bulk and freeze in individual bags,” says Greutman. “Use a Crockpot or Instant Pot to defrost and dinner is done.”
See related: Best credit cards for food delivery
5. Online impulse purchases
Increased time glued to screens may be at least partially responsible for the massive hike in internet-based shopping in 2020. A Digital Commerce 360 report found that consumers spent $861.12 billion online with U.S. retailers last year, a 44% increase from 2019. There were many e-commerce winners, but Amazon especially benefited as enrollment in U.S. Prime membership hit 200 million customers.
“We did a lot of mindless shopping because it was so easy and the shipping was free with services like Amazon Prime,” says Bodge. “Consumers got used to immediate gratification, but that’s not always a good thing. Not everything people bought turned out to be necessary.” If you overcharged, you may want to cancel your Prime membership so it’s not so tempting. “Or open the Amazon Prime Rewards Visa,” says Bodge. “You’ll earn 5 points back on everything you spend.”
See related: Best credit cards for online shopping
6. Home improvement
Being locked down was an inspiration for many people to transform their living environments. After all, if they had to be stuck at home, why not take the opportunity to make it nicer or build out a cool office space? No surprise, then, when furniture and home décor companies saw shopping spikes during the pandemic. Sales at Wayfair, for instance, increased 66.5% in the third quarter of 2020.
If you have a little left to do, Woroch says you can finish with the assistance of your credit cards. “If you have rewards cards and used them to buy furniture and other big-ticket household items over the past year, you’ve probably accumulated a lot of points or cash,” she says. “Use the cash at discount stores instead of high-end retailers or buy gift cards with the points and shop when items are discounted.” Then stop. You’re done.
See related: Best credit cards for home improvement
7. Scarcity items
Stocking up on necessary products was all the rage in 2020. According to a Shopkick survey, 47% of consumers bought extra essentials such as toiletries, food, water, cleaning supplies, medicine, health care items and pet supplies.
“A problem with this type of scarcity shopping is that consumers were buying when prices were at their highest or were buying too much because they didn’t know when they’d be available again,” says Greutman. “This is what happens when people aren’t prepared.”
Now with perspective, you have a better understanding of what you should have on hand in case of emergency. Buy what you need when items are on sale, and gradually, so they don’t strain your budget.
See related: Best cash back credit cards
8. Streaming services
Cinemas, sports arenas, concert venues and theaters all went dark for the majority of 2020. People still needed entertainment, of course, and for that reason, online streaming services took off – as did people’s cable bills. As of January 2021, U.S. consumers were paying $47 per month for these services, up 24% since COVID-19 hit, a J.D. Power survey found.
What was valuable then may be wasteful now. Review your cable bill and eliminate all monthly subscriptions that are no longer necessary. “During the pandemic, I signed up for Showtime, Hulu and Disney,” says Woroch. “I’m canceling them. We want to go outside!”
See related: Best credit card for streaming services
9. Special protective items
A wardrobe of masks, boxes of latex gloves, quarts of hand sanitizer, special cleaning supplies … U.S. consumers bought more of these products than ever before, as people did everything they could to stay safe and reduce the chance of COVID-19 infection. Sales of hand sanitizer alone were up 838% in 2020, reported the branding firm NCSolutions.
These expenses are unlikely to go away entirely, but the amount you spend on them may be greatly reduced. If so, think about alternative ways your money can support your health care needs.
“I’m a huge fan of taking what you were spending and actively moving it into savings,” says Bodge, who suggests adding it to a Health Savings Account, if you have one. “You’ll be depositing pretax income, enabling you to save more for your wellness needs.”
Excited to make vast improvements in your financial life? This is a unique time for it, so take action.
“We’re all coming out of this pandemic with a lot of gratitude and are ready to reset,” says Greutman. “COVID forced us to slow down and take a look at what is really important. This is a great opportunity to make our spending a reflection of new priorities.”
Therefore, if you did accumulate costly debt, rework your budget so you can pay it off as quickly as possible. And make a commitment to using credit cards thoughtfully and beneficially.