During these times it is important to take care of your financial health and manage your funds appropriately for today and the times to come.
The past few weeks have been hard on everyone and financial stress has dominated many. With the range of emotions varying from nervousness to fear to uncertainties, it can be hard to plan anything right now. During these times it is important to take care of your financial health and manage your funds appropriately for today and the times to come.
These 5 steps can help manage your funds effectively:
Budgeting – Managing earnings vs spend: Keep a clear account of your earning and spends. In these times there can be sudden/unplanned expenses, so it is important to assess your funds frequently. Adjust your spending and spend on essentials only. Re- distribute budget allocations to priorities of essentials like groceries, medication, food, education etc. Health is the most important asset hence do not compromise on your health. Eat well, sleep well and be positive. Do not forget to keep aside some money for urgent times or to support family and friends.
Keep your investments intact: Keep your investments intact and continue with your planned investments to safeguard your future and your financial health. Diversify the investment portfolio to minimise the risk and do not fall for quick-buck schemes that promise high returns in a short period of time.
Clear your current loans before taking a new loan burden: Loans may end up being an additional burden if taken at an uncertain time. It is advisable to avoid taking additional loans during a pandemic situation unless necessary, try to manage by borrowing from friends and family as much as possible. If funds are being managed well, pay your EMIs on time to avoid any default and further financial burden.
Seek help and financial guidance: A healthy conversation with a financial advisor or a financial expert can reduce burden of financial stress and its management during the current health pandemic. Good guidance gives clarity and assurance on how we are faring our funds, what are we doing to cope with financial stress, and it gives us a direction for a secured future.
Keep Emergency Fund with you: Basis your earning and monthly spends, you’d be aware of your family requirements & expenses. Keep a contingency fund separate, this money will come handy during unforeseen situations. Financial experts recommend having three to six months’ worth of living expenses in an emergency fund. Save the funds spent on travel, meals-eating out, leisure activities etc. towards your emergency fund. Do not compromise on essentials like health and education.
Source: Business World