Improve financial health during lockdown: As the whole world is under the threat of the pandemic virus, known as COVID-19, people are concerned about their finances. Many people are experiencing job losses as companies across globe shut production. Markets have also shown huge fluctuation wiping our crores of investor’s wealth. Needless to say, people are looking more anxious about their jobs, businesses and income.
Now, it’s obvious that its a difficult or harsh time for us. With so much uncertainty around, it’s important now more than ever to focus on saving and reduce spending. with some essential financial steps, we would defend ourselves in this harsh time.
7 proven tips to improve your financial health during the lockdown.
1. Keep Emergency Fund: Emergency is unpredictable and difficult to manage. The old saying that holds always. Save as much as possible. Maintain a budget. Avoid expenses that you can. In short, keep an emergency fund.
2. Insurance cover: Situation and instances like COVID-19 can happen anytime. Do check that you have proper health and term insurance cover. Check your health coverage benefits and know how much it will cost you during any critical illness. If needed, increase the premium amount by taking more coverage. This will benefit you during a health emergency. Take proper health coverage for your family. Do an honest assessment.
3. Check your EMI/Installments: If you have not opted for the bank’s EMI moratorium, and not paid your EMIs installments yet, your credit score might get impacted. Either you opt for a moratorium or pay your dues on time. A good credit score will help you in the future loan if needed. Don’t ignore your CIBIL score.
4. Go Digital: As per Government health guidelines we need to keep social distancing to avoid COVID-19. So, it is better to use a digital wallet as much as you can. Completely avoid going to your Banks or ATMs for any financial need and use. “Use online banking, cards, UPI or wallets for payments and managing investments. Avoid using cash, keep ATM visits minimum.
5. Continue with SIPs: Keep your SIPs. Don’t do panic withdrawal: You never know what is in store for you in the future. To keep you financially strong, keep saving your money by continuing your SIPs and long term investments. Don’t panic and redeem all your investments due to the huge volatility in the markets. Don’t redeem your investments in a panic because of the market. Naveen Kukreja, CEO & Co-Founder, PaisaBazaar.com says, “Continue your SIPs, it will help you in creating bigger corpus when the market’s rebound. Top up your existing investment in equity using asset allocation strategy”.
6. Relook investment portfolio: It is advisable to relook at your investment portfolio and just sell the equity or any holdings which are not giving you benefit since long. One can sell and buy some good stocks and invest in strong margin companies for the long term. Invest for the long term.
7. Refrain from panic buying: Don’t spend your money buying food items, groceries, medicines just to stock up things due to fear of lockdown. Essential supplies will continue. Only buy those items which are very much important apart from daily use items. Panic buying will put a strain on your finances.