How to manage Finances during Crisis.?

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The world economy facing an economic downturn worse than the Great Depression, thanks to COVID-19.

World governments are giving trillions of dollars in stimulus packages to boost their economies, but all these stimulus packages might not help you to sail your life safely.

The global recession will impact purchasing power and that will be reflected in prices for all goods and services.

Job losses, pay cuts, appraisal deferments, contraction of GDP, these are the buzzwords you hear and see these days.

Whether Covid 19 will trigger a recession or its a hyped let's leave that to the economists what we can do is making our life a recession or crisis-proof.

Now is the time to act quickly and manage your finances smartly.

“The person who doesn’t know where his next dollar is coming from usually doesn’t know where his last dollar went.”

Let’s see some practical tips to manage the finances during the crisis.

1. Reduce your discretionary spending
2. If you have an emergency fund now is the time to use it.
3. Honor your EMI obligations on time (by not availing moratorium)
4. Do not liquidate your Long term investments (including PF)
5. Become frugal, cut down the newspaper, cancel the Netflix Subs, for groceries purchase value packs (bigger packs), cut down the Broadband, postpone vacation plans/ big purchases.
6. Prepare a strict budget and make sure you follow the budget goal.
7. Upskill yourself (helps you in case of job losses)
8. Do not panic sell/stop your investments (Mutual funds/ SIPs)
9. Once dust gets settled plan for additional income sources like freelancing/ part-time teaching/ rental income etc.

“Know what you own, and know why you own it.”
Peter Lynch

-Stay Home Stay Safe.