In the worst pandemic in recent history, our finances are taking a hit. Here are some sensible ways you can take — immediately — to preserve your livelihood and, possibly, your family’s financial well-being.
Photo: Unsplash | Source: Medium
1: Cut your costs
If you’re self-isolating or working from home, perhaps your outgoings will fall thanks to lower travel and food costs. However, now is an excellent time to review any subscriptions to determine just how ‘necessary’ they are: that bi-weekly cycling magazine subscription? Perhaps now is a good time to break the tie.
Pause a regular payment for something you’re either unable or unwilling to go to at the moment, like a gym membership. Some gyms are enabling their users to pause their membership for a month and carry over any credits, so double-check this, but, in most cases, these things should go.
2: Refunds and bills
Those of you who are commuters and have paid for either annual, monthly or weekly tickets will be able to get a partial refund. Many countries transport systems are offering some sort of reimbursement, so it’s worth checking.
Some energy companies are also pulling their weight offering breaks on bills to its five million customers on a case-by-case basis. Check all your utility bills to see if your suppliers have made any accommodations.
3: Check your stocks and shares
It doesn’t take a financial genius to see the virus’s economic toll. The stock market has been decimated: business confidence is low; many have shut down altogether, consumer spending reduced, and market shares are tumbling.
When fear subsides, there is an argument that the markets will rise again. However, some feel that it might not rebound so quickly, with well-informed journalists speculating a recession.
There’s no universal approach here. Some will ride it out. For others, getting out might be the only viable option. Evaluate the risks alongside your short- and long-term cash demands as well as investment prospects. Then take appropriate action
4: Protect your income
Many countries are offering a % of one’s salary to be given out to those unable to work. For those of you who are self-employed, signing onto whatever social support system your country offers is a must. Many governments have eased the transition with which you can ‘sign on’ and increased the pay-outs.
On a more optimistic front, some businesses are hiring, mainly supermarkets and immediate commodity industries. Perhaps there are opportunities like this near you too — if you’re willing to risk it?
Alternatively, you could also consider applying for a 0%-interest credit card, although this should be done at your discretion. As it stands, most major banks haven’t made any significant changes, but if one changes its position, others are likely to follow suit.
5: Invest? In a crisis?
Investing, right now, can be a game-changer. Any returns will be particularly slow and may never come BUT this depends on what industry you invest on.
Moreover, some listed companies will go bust; leaving investors tending to massive losses, but dips in the market can be an excellent time to buy if you can stomach it and don’t need the money for many years.