The unforeseen disruption of the novel coronavirus outbreak has forced businesses to reevaluate their strategies to continue their core operations and recover the loss. Meanwhile, it has struck fear and anxiety in people.
There’s no concrete prediction as to when this pandemic will ease off. Because of this, many are worried and asking themselves if there’s any way to secure their finances, build up their funds, and prioritize their expenses in the middle of a crisis, when several industries are seeing instability.
In times of uncertainty towards job security and financial unrest, you must take practical steps to manage your finances and avoid financial problems to survive through this global health crisis.
Build and prioritize your emergency fund
The pandemic has affected economies, businesses, and livelihoods. Thus, your top priority in a financial crisis should be building up your emergency fund. A lot of businesses are closing up due to loss, and many people are let go from their jobs. If you’re worried that you might lose your job as well, the last thing you should do is invest more of your money.
For now, save at least six months’ worth of emergency fund, enough to cover your day-to-day living expenses. If you can set aside more, do so. Consider taking side hustles and try figuring out ways to cut down expenses to build a bigger emergency cushion. In difficult times like this, you should prepare yourself for the unexpected.
Continue allocating funds for your savings
While it’s essential to build a sizable emergency fund, you must not stop setting aside for your savings. Keep any amount you have saved and, if possible, continue contributing to it to support your long-term needs.
If you received government financial assistance, allot a portion (or the entire amount) of that into your savings instead of spending it on something less necessary. When you can cover shortcomings with your savings, you won’t need to spend your emergency fund or sell your investments.
Manage your debt and utility bills payment options
If you have pending debts to repay, put your extra money into these payments. If your budget is a little too tight and there’s nothing you can do to squeeze these in, call your bank or lender and ask if they can waive the interest rates and late fees for the time being.
The same goes for utility bills—much like how banks and creditors acknowledge the substantial impact of the pandemic on their customers, internet service providers and power distributors are likely to waive bills and offer staggered and flexible payment solutions. Make sure to be proactive and reach out to them to help you find the most practical option that fits your current financial situation.
Start an investment account
If you managed to build up a small amount allocated for investing before the pandemic started, consider investing in stock trading or any other investment options. Because of the pandemic, stock prices have dropped, and many investors are picking them up on a bargain.
If you’re happy with the amount in your emergency fund and can continuously contribute to your retirement fund, consider opening a personal brokerage account to put money in the market and build your wealth. When you invest, keep it in the market for as long as you can and gain higher profits when the market turns bullish again.
Get what you need within your budget
During a pandemic, it’s important to stock up on necessities. But, not a lot of people have a significant amount of money to get everything they need, and this is where shopping and stocking up smarter come in.
When it comes to groceries, reach out for shelf-stable foods, fresh foods that freeze well, and long-lasting products in case you get stuck at home longer than expected. For medications, pick up some extra supply of your prescription medication, along with some cold and cough medicine.
Before you head out to stock up, do an inventory of what you already have at home, so you won’t make the mistake of buying more of the same things and spending more than you have to.
Trim your spending and track your expenses
Keeping a budget and sticking to it is the key to help you take better control of your finances and give you peace of mind during difficult times. Take time to sit down and look closely at your finances to help you spot opportunities to save money and trim your spending.
For instance, consider cutting off one of your streaming services and unsubscribe from your gym membership. Do also look for monthly bills you could reduce, such as your phone plan and cable TV. As much as possible, refrain from getting food delivered and cook your own food.
Wrapping it up
Focusing and monitoring your budget and expenses is the best way to keep your finances in order right now. Whenever you feel the urge to shop online when life gets a little too stressful, do your best to curtail it.
Remember that while this is all temporary, you need to get a stable footing and prepare yourself for more financial hits. When everything settles down, you’ll thank yourself and call all your efforts worth it for managing to build funds for your future.
The author of this article is Adrian Reid from Enlightened Stock Marketing
Image from https://www.pexels.com/
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