The Corona Virus Disease 2019 or COVID-19 pandemic shocked the world ‘like no other’ involving troubles to the world and the economy.
While the world is already slowly recovering through vaccination roll out, the magnitude, and impact of the pandemic has already damaged businesses that eventually resulted to job losses and shrinking financial conditions.
The Philippines is no different story.
Locally, unemployment rate in April 2021 was recorded at 8.7 percent where 47.41 million Filipinos aged 15 years old and above are either employed or unemployed.
The once-in-a-lifetime pandemic really brought misfortune and suffering at the doorstep of many Filipinos.
But wherever one finds himself on the spectrum, there are some personal finance rules and tips that could be essential during these times.
Don’t panic.
Surviving and succeeding in these times focus on the financial planning one does before the impact of the crisis, during the period if you are affected, and when things revert back to normal is felt.
Calculate your expenses. Financial consultants often say that three months of worth of expenses should be saved for emergencies. And no matter how adequate one’s emergency savings are, you will never know how long you might need to cover expenses in the event of a loss of income such as these uncertain times of the pandemic. According to one media company that focuses on business, the rule of thumb is three to six months of expenses in a savings account.
The particular amount to be saved could depend on the personal comfort level of the family, the availability of other sources of income and how risky one’s income is. Regardless, the money should be easily accessible in a savings account or safely secured in your emergency kit.
Aside from an emergency savings, another idea worth considering is to create a ‘crisis budget.’ Someone affected by the pandemic job-wise should learn from the indefinite situation. It is good to allot a budget that eliminates any non-essential expenditure and only dish out on food, shelter, transportation, and other basic needs. Knowing how much one needs to survive will help prevent you from panicking because you know exactly what to cut back on and how long your savings would last.
Also, one of the simplest tips to adjust to these trying times of the pandemic is tracking your spending. It is better to understand exactly where your money is going to stay on track of your financial goals.
On a more serious matter, if one also has loans and the like coinciding with the pandemic, it is important to plan.
Financial advisors often say that the more you communicate with your creditors, the more willing they will be to help you if you are having financial woes.
Contact creditors immediately!
Most of banks and creditors are aware of the effect of the pandemic on their clients and will offer to work with you if you get to a point where you could no longer pay your bills.
Lastly, adjust your lifestyle. This pandemic has taught a lot of people when it comes to differentiating needs from wants. Anything that does not include essentials like food, shelter and transportation should wait. This could help you big-time in weathering this transitional period.
Remember: This too shall pass.
Save money and money will save you.