5 Tips for Managing Your Finances During the Coronavirus Crisis
A lot of economic and financial consequences have arise in the world during the Covid pandemic. Many markets were forced to close and people had to make some big financial changes, for instance. Since the problem is likely to become more serious as the disease evolves and spreads, the question is: how can I manage my finances during this crisis? In this article, you will find some tips!
It is a fact that the Coronavirus pandemic has affected the world in one way or another. The public health sector, for instance, has had the greatest impact due to the high percentage of people affected and the need for professionals to care for them. Moreover, this disease has also produced great effects on global economy and finances, since many markets had to close and stop their sales temporarily. Even people had to make some changes in their financial habits, such as saving more money than usual.
Since the quarantine period is indefinite, it is important to carry out effective financial management. In order to do this instead of falling into debt and other financial problems, you can use these tips:
Focus On What’s Truly Important
You must first focus on vital expenses such as food and medical care to prioritize your health and well-being. In other words, you should invest your money in medical consultations, disinfectants, and healthy and nutritious food, for example.
Secondly, avoid making massive purchases in which you fill five shopping carts. Try not to be tempted by offers, if any, because they can put your finances at risk. While it’s recommended to go out as little as possible—especially for older people—experts advise to buy just a week’s worth of supplies. Remember: only the necessary.
And finally, if you are one of those who love buying online, try not to be tempted to buy unnecessary things. You have to ask yourself regularly: “Do I really need it?”
Make a List of Your Accounts and Debts
It is important to calculate the amount spent on your monthly bills or debts. Be sure to prioritize your basic payments such as rent, water or gas, before others that are not so urgent:
- Mortgage or rent
- Credit card
- Overdrafts
- Loans
- Hire purchase payments
- Utilities such as phone or internet bills
- Payments to Revenue
In addition, keeping track of your daily expenses is a good idea for analyzing your finances. You must diagnose and know how much money you have at the end of the month or how much you have left to pay, in order to anticipate any loss of money and need for additional income. To do so, you can use the MABS Household Budget Sheet (pdf).
Contact Your Creditors If You Think You Might Be Late with Your Payments
If the contingency caused by the COVID-19 will significantly affect your finances and you will not be able to pay some bills, approach the bank to negotiate before going into default.
If you are having problems meeting your rent payments, you should contact Threshold, the national housing charity, which provides information and advice to people in private rented housing. For further information, visit The Citizens Information website.
Create a Financial Cushion
If you’re getting paid and your spending level has dropped because you’re working from home, this is the best time to save money. Since we are in quarantine, we cannot spend money on eating out, going to the cinema or sports events, for example. Therefore, amounts that are no longer spent can be allocated to a financial cushion for emergencies, redistributed to cover essential expenses or settle debts.
Take Advantage of Free Online Courses
You can find many free online courses to learn something new. The good news is that while being at home, you will be entertained and, at the same time, investing in education. In fact, Harvard University offers 62 free courses for you to take from home. Check it out!
Other Resources
If you feel that the Coronavirus situation is affecting you drastically, read the information below:
- MABS guide to coping with mental health and financial stress (pdf)
- HSE advice on minding your mental health during the coronavirus outbreak
- WHO factsheet on mental health and coping during COVID-19 (pdf)
COVID-19 has had a major economic and financial impact, as many markets were forced to close during quarantine. In addition, since the quarantine period is indefinite, people had to make some changes to their personal finances. It is better to make a list of priorities and have up to date payment of basic needs such as electricity, water, health insurance, etc. And finally, in case of any inconvenience, it is a wise choice to save a little more money than usual. What about you? Have you already applied some of these financial tips? Let us know in the comments section!
