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The start of 2020 may not have been good for all of us, but if there’s one thing good about the Coronavirus and the ongoing Community Quarantine wherein most are required to stay at home for everybody’s safety, is that is has forced us to redirect our attention to things that matter the most, like our relationship with God, with our loved ones and with the people around us.
Aside from being united by staying apart, COVID-19 also brought along some important lessons, money wise. This indeed is one of those turbulent times, so it’s not just prudent but critical to think about our financial health, especially if we don’t have a secured amount of wealth to fall back on. Strategic spending is needed to survive and thrive in this crisis.
Whatever the case is, here are some financial lessons that could help you get through the Coronavirus outbreak.
Nobody’s really prepared for a pandemic and the lockdown brought by it. Millions of businesses are closed, leaving a lot of employees temporarily unemployed. Some are luckier to have the chance to work-from-home, but still, for some, our current resources may not be enough. “You should have an emergency fund” or “You should save for the rainy days” could have sounded like stale phrases months ago, as we were used to living our normal lives, working, spending and living it to the fullest without fearing that one day, our main source of income could be gone. And here we are today, facing a pandemic, stripped from our normal ways of living.
Having emergency funds as part of your savings allows you to take care of your basic needs in cases of emergency, like job losses or pay cuts. A common rule for setting up an emergency fund is to save at least three to six months of your monthly income and use it only in emergencies. If you still don’t have one, there’s no better time to start than now.
Needs over wants, especially in times like this. With many services suspended and we are required to stay at home, be sure you aren’t paying for the things that you aren’t even getting. Scrutinize your monthly bills, especially your subscriptions like fitness classes and travel plans. Some businesses are offering refunds so make sure to get your money’s worth, or think about cancelling subscriptions that you don’t currently need.
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Some of us turned to online shopping so we can still stay at home and get what we need. It’s only natural to expect a small raise in prices and delivery fees as some companies cope with the effects of the pandemic economy-wise, not to mention the closure of most brick-and-mortar shops and the lack of personnel.
However, please check raised prices accordingly. Make sure the prices are reasonably increased, not excessively surged. Make time to research an item and look for options, and always choose the most reasonably priced.
Review what you’re spending on, on a daily basis. It’s important to see where you can cut down and how much more you can save. Be thorough and check everything, from your monthly utilities and bills to your daily spending on your wants and needs. By prioritizing your needs, it’s easier to cut down on your wants and save more money in the long run.
After reviewing your expenses, it’s now time to plan your finances and set a budget according to your needs. Organize it according to basic needs and nice-to-haves. Basic necessities include food, water, electricity, and internet connection. Nice-to-haves are snacks and some subscriptions to keep you busy at home. Plan wisely and cut down where you can.
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This pandemic might be temporary but the lessons it brings shall live with us forever. Focusing on your budget right now can help you feel a sense of certainty in spite of uncertain times. We hope you find these tips helpful and may you start working towards a much financially secure future.
Money Management, Money Management Tips, Financial Wellness, COVID-19, Financial Lessons in COVID-19, Coronavirus emergency fund