Managing My Family’s Finance during This Pandemic
The future is always uncertain. Even a year ago, nobody had thought that a pandemic would cause so much havoc in today’s world.
In terms of technology, human civilization has made steady progress. Equipped with technology’s power, people have started thinking that nothing can stop the world from moving ahead.
But, then, a pandemic happened. All the countries across the world had to declare lockdown since the beginning of 2020. Although many countries have started lifting lockdown partially, the threat of a pandemic is still looming over our heads.
In such a crisis scenario, you need to take care of two things. First of all, the health of your family should be the top priority. Secondly, you need to plan your finances properly.
The Covid-19 pandemic has disrupted a lot of business sectors. At the same time, it has appeared as an opportunity for many business fields. So, the global economy is undergoing a difficult phase where a lot of uncertainties can be noted.
Due to lockdown, many small and medium scale businesses have come across a lot of difficulties. Many companies have closed doors for good as a result.
The concern of job loss is also there among people around the world. In this scenario, it is important to plan your finances properly. To manage your finance during this time of the pandemic, you can follow some of the tips discussed below.
Time to Evaluate Monthly Expenditure Again
Every family has some expenses. Based on the lifestyle of the member in the family, the expenses have been determined. In most of the cases, it has been noted that each family has some common monthly expenses. Finding those common expenses is important for creating a monthly family budget.
Once you set a budget, the expenses of the month stay near to that budget. Sometimes, the expenses could go higher due to many emergencies. For example, the illness of a person in the family can lead to additional expenses. Your house may need repair or maintenance, and it will lead to additional monthly expenses for a household.
After the Covid-19 pandemic, two concerning things are expected to happen. First of all, there could be a large number of job losses. Many people would lose their jobs, and thus many houses will face a financial crunch due to a lack of steady earning sources.
Another thing that is anticipated to happen is the price rise of commodities. Along with luxury items, the price of essential commodities may soar for the next few years. As the scope of income gets narrowed, and the commodity price goes up, people need a fresh evaluation of their monthly family expenditure.
It would help if you listed the monthly expenses. Once they have been listed, you need to check potential budget cuts in a few things. There could be a lot of luxurious expenses. You can cut the budget for those expenses.
During this time of the global pandemic, hefty and mindless expenditure is a foolish exercise. Except for the basic expenses, you should consider budget cuts for all other expenses of your family.
Do Not Step into Panic Buying
As soon as the lockdown was declared, people went into panic buying mode in different places. A large number of people had started stocking their monthly foods at unusually high quantities.
However, all government and non-government sources had confirmed that the food crisis would not happen during the pandemic. There will not be a shortage of monthly supplies for food and groceries for your family. So, there is nothing to be panic-stricken. You can get essential goods whenever needed.
Avoid Panic Selling Too!
Like panic buying, panic selling is also a concern. Many people who hold an investment in the share market have started selling their shares. Since there are lockdowns everywhere globally, it is expected that businesses would not do well in such a scenario. Hence, the share prices of the companies would start falling.
But, it does not mean that you have to sell all your shares. As the world keeps recovering from the pandemic, business activities will start gaining momentum once again. As a result, share prices will go up once again. Hence, this is not the right time to sell your shares out of fear. A good time will arrive soon, and you shall get better value against the share bonds you possess.
Review Medical Insurance for Your Family
At this time, your family needs health safety. You need to follow the safety measures to avoid getting infected by Novel CoronaVirus. Despite taking all the precautionary measures, you or someone in your family may become a Covid-19 victim. Hence, it is the right time to review medical insurance for your family.
You should consider making more investment in medical insurance policies for better insurance coverage for your family members. Nevertheless, you need to check the details of your existing medical insurance policies.
Many policies do not include Covid-19 coverage. You need to contact the insurance company to know the status of Covid-19 coverage for your family. If there is no Covid-19 coverage, you need to upgrade the health insurance policy for your family.
Utilize the Time for Passive Earning
Due to lockdown, offices and colleges are still closed. Many people are working online. Students are also attending online classes. If you have a good amount of time in hand during the lockdown, you can utilize the time to explore the scopes for passive earning. An additional source of income is important for many reasons. Here are some of those reasons for you.
- Covid-19 has disrupted various conventional jobs. As a result, people should find passive earning opportunities. Even if you lose a job due to lockdown and economic recession, you do not have to starve. You can still support your family with your passive earnings.
- Passive income is a great way of adding more monthly savings. At this point, you need to find ways to increase your monthly saving. Many people opt for reducing expenses, and that is a good idea. But, monthly savings would increase drastically when you shall find more sources for earning.
- Taking advantage of the free time is important for earning some money. You may have some financial goals. With an additional income, you can fulfill those financial goals faster.
- Passive earning opens up new doors of opportunities. You can start a new business or start working as a freelancer. Passive income through the online platform could even be higher than your regular income.
Plan Payments of the Credit Card Bills
Even during the pandemic scenario, you should plan your credit card bill payments properly. If you cannot pay certain bills, you can contact the credit card company to offer you a discount in such a financially challenging scenario.
If not a discount, you can get some relaxation in paying your monthly bills. For example, a single large payment can be broken into small monthly installment based payments. This is an effective method of paying credit card dues, and it does not harm your credit rating.
Plan Investments If You Have Money
Due to the pandemic, share prices of various companies have fallen drastically. However, the fall in share price is a temporary thing. Well-established companies will bounce back again. Hence, it is the right time to purchase some shares of such companies.
You can purchase the shares at a low price. In exchange, you may obtain an excellent return on an investment after 3-5 years. If you have money, this is a good time to invest in the share marketing trading. However, it has some downsides too. There are some risks, as a lot of companies are undergoing deep financial crises.
Rent Your Second Home
If you have a second home, this is the best time to find tenants for the property. The real estate industry has also been affected by the covid-19 pandemic. At this time, thinking about selling a property is a bad idea. Property prices have gone down, and buyers are not ready to pay a high amount for the property purchases.
Instead of selling the property, finding tenants is a good idea. It will fetch a passive income for your family. The money you shall get from the rented property will be more than adequate to meet your family’s necessities.
You can make your monthly savings higher with the money. You can also invest the money into the maintenance and repair of the property.
Online Specialization Courses for Kids
Due to the pandemic, kids are getting accustomed to online class or virtual learning. Since they stay at home, parents need to motivate the kids. You must spend more time with your kids.
At the same time, you must encourage the kids to pursue vocational courses through various online platforms. For these online courses, the expense is not high. Pursuing those courses from reputed institutions would cost you high. But, learning things online will be a cheaper option. Vocational training can open up the door of passive learning for your children.
The future is uncertain, but it does not mean that the future has all the negative things in store for us. A lot of good things will happen, along with bad things. Staying prepared for the future as much as possible is crucial at this point in time. Thus, planning finance is crucial for everyone.