With the rampant spread of coronavirus cases all across the globe, it is pretty evident to feel insecure or uncertain about various aspects of life these days, and especially about your financial health. The current situation has caused an equal amount of damage to physical as well as mental health where finances have got a considerable part to play.
Throughout this turbulent period, your health is evidently the matter of prime concern, and therefore, you must take the best care of your health. However, one also cannot overlook the importance of the financial situation. With the stronger support of your finances, you will be ever-prepared to face any kind of situation in the coming days, weeks, and even months.
Let’s find out how you can keep your finances in check to smoothly tide over a critical pandemic situation:
Expand your Savings
Looking at the current situation, no one can tell for how long the lockdown will continue and at what pace the economy will come back to action. You might be required to stay at home longer than expected. With that, if your profession is such where work from home is not possible, you are most likely to lose your income. Instead of getting worried, you should look for options to expand your savings.
Since you are staying at home all day, there are many ways through which you can cut down your nonessential expenditures such as traveling, dining out, shopping, and so on. You can also look through the free sources of entertainment such as e-books, movies, etc.
Strengthen your emergency fund
If you are fortunate enough to have the facility of working from home, then you must consider strengthening your emergency fund. Nowadays, you stay at home the entire day so it is much easier to save extra money. You can easily avert the temptation of spending money over luxuries. Moreover, the regular commuting cost can also be saved. You can increase your savings by saving a tax refund too.
Avoid panic buying
Grocery stores or retail stores across the countries have run out of stock of various everyday essentials such as toilet paper, sanitizers, and various cooking items. Do not give in to the impulse of buying everything at once. Before you buy something, do check the already stocked items at home and if they are enough to sustain through the weeks.
Instead of clearing out the shelves, do buy as per the legitimate requirement and be sensible enough to think others also need those supplies. It will not only help you save money but also prevent the shortage of supplies and resultant price hike.
Make the best use of low-interest rates
Due to increasing uncertainty, interest rates are decreasing. If you are someone with a good credit score, then you can apply for all kinds of borrowings at a tremendously low rate of interest.
If you have existing debts such as student loans or a mortgage, then this is the best time to refinance. It can help you save a substantial amount of money.
Seek help from your landlords and lenders
If the pandemic has hindered the inflow of income, then you may face challenges in keeping up with your bills. If you do not possess enough savings, then you most probably would land up in a tricky situation. Instead of damaging your credit score due to late payments, look out for financial help from your landlords and lenders.
Looking at the gravity of the current situation, many lenders are willing to support their borrowers. Taking help from them can help you navigate through this tough time in a better way. Thus, do not shy away from asking for extra help especially if you have been consistent with your payments in the past.
Do not make acute changes in your investment plan
One of the outcomes of COVID-19 is the escalation in the volatility of the stock market. Many people would be planning to sell their stocks out of panic, however, this would not be a wise step to take right now. In fact, selling stocks during the time of crisis could result in a huge financial loss.
During such difficult times, patience is the key. Most likely the market will improve and hence, sticking to your investment plan is still important. Hold back from taking any hasty decision that may later become the reason of your regret. Carefully analyze your investment plan and stay positive and determined.
Conclusion
The COVID-19 situation has brought the entire world onto its knees, but it does not mean that your financial health should suffer. In any situation, patience, diligence, and determination is the key. Do not make any decision out of panic or stress. Stay calm and take calculated action to increase your emergency fund before the virus takes a toll on your finances. Take calm headed decisions to prevent any long term financial crisis.