7 Financial management tips to thrive in the COVID-19 pandemic
Do you still remember how you lived before COVID-19 hit the globe? The coronavirus brought the world to a standstill, which resulted in a global financial crisis. Locally, it has been almost four months since the government imposed a quarantine on the entire country. Unfortunately, after this significant portion of time, the nation is still struggling to defeat it.
But as Filipinos, we never back down. It’s not in our blood to bow down from a fight. And as we battle the COVID-19 pandemic, we must be equipped with the best armor we can have. Realistically speaking, at this point, that’s money.
So, ask yourself, how can we manage this financial crisis?
Don’t panic! We’re here for you.
Here are some tips you can start with to get your financials back in track during a crisis like the COVID-19 pandemic.
1. Take a step back and examine your financial status during COVID-19.
Because of the pandemic, life, as we know it, has transformed into something so different. The traditional business models do not work anymore, and the lifestyle that people were used to has changed drastically, too.
This change is why it would do you good to take time to reflect and make a list of things that changed and those that stayed the same. Look at how your expenses used to be and how it has changed now. For instance, the average adult used to spend on transportation, eating out, and social activities. he current work from home setup can bring possible savings – unless you have to invest in new work tools like better internet connection, cellular data, or a better laptop.
2. Organize a crisis-friendly budget plan
After identifying the things that have changed in your life, it is now time to allocate your spending. First, check on the current inflow of money into your funds and evaluate whether that would be enough to sustain your needs. On a piece of paper (or the notes app on your phone if you’re digital), list down all available sources and the usual dates when they come in.
If you want to thrive and survive, the best way to do so is to make a list of expenses and organize them by the level of priority. Which payments are non-negotiable? What are the things that you must have in your life so that you will survive? Frequently, essential expenses include food, rent, mortgage, utilities, and healthcare.
For your pandemic budget, a solid plan would be to focus on said essential expenses and temporarily set back on your wants. In your budgeting, allocate 50% income for your needs. You should also use 25% for wants and add the rest to an emergency fund.
3. Invest in financial literacy
On a lighter note, the pandemic gave people a little more time, as it eliminated the dreaded commute now that most people are working from home. You can take this as a chance to become more financially literate to manage your money better. There are many free resources that you can utilize online, including Grit PH. This website helps Filipinos become more equipped on how to become an entrepreneur and grow their money. Just browse through the articles on their blog and their social media pages, read about the topics you like, and you’ll end up smarter within minutes.
4. Look for Alternative Sources Of Income
During this financial crisis, it is no longer safe to put all your eggs in one basket. Trusting one source of income can be difficult in the long run, especially with knowing how volatile the global economy currently is. Reflect on yourself and what you can do. You should make the most of your knowledge and skills and leverage the best parts of yourself. Nowadays, it is crucial to have a side hustle to enhance the income sources you can use for your emergency fund.
5. Talk to your credit provider
Having a line of credit is very important, especially when you are in a pandemic. If you fall victim to this health crisis, it would be great to have something to help you get by. Additionally, if you have some existing loans, schedule some calls to renegotiate your current terms. Most lenders are open to being lenient, stretching out interest charges, and helping you out once you open things up for discussion. Again, these solutions will only be possible if you call your lender and talk about everything.
6. Prepare for a health emergency
Nobody would want to get affected by the coronavirus, but it is still crucial that you are ready if health problems come. It is vital to work around building your emergency fund and extra cash just in case you need to pay for medical expenses. Additionally, it would be perfect to have insurance that covers your health and your life. Though it might not be able to include the entire charges, having this contingency plan will allow you to have a lifeline if things go awry.
7. Stay focused and keep your long-term goals in mind
Though we are currently under the COVID-19 pandemic, you shouldn’t forget that it will all be over eventually. Think about your future and what you envision things to be. Plan out what you where you want things to be once we get the hang of the new normal. But also consider changing things up to adapt better. Whenever you feel like panicking, take a step back and evaluate things from afar. Remember that even though you have some long-term goals, approach it with a day by day approach to avoid overwhelming yourself.
There’s always hope
Nothing beats dealing with a crisis like the COVID-19 pandemic than becoming prepared and educated. Knowing how to handle your finances will make you feel more confident and ready to embrace what lies ahead. Financial management will help you take control of your personal life, improve your career opportunities, and secure your future – even with the challenges that life throws at you.
You may visit our website or check our blogs to learn more about financial management at https://blend.ph/.