After the nationwide lockdown last year, many States have imposed partial to full curfew/lockdown again this year to contain the second Covid wave.
After the nationwide lockdown last year, many States have imposed partial to full curfew/lockdown again this year to contain the second Covid wave. As a result, many people have either lost their jobs again or are facing salary cuts that cause immense financial hardship for them.
The high rate of food inflation is increasing the hardship further, forcing the affected people to cut expenses.
Here are what experts suggest on how to manage your savings and finances during Covid:
“It’s best to go frugal on all non essential expenses during these times and save & budget as much as possible,” says Abhishek Soni, Co-Founder & CEO – Upwards.
As suggested by Soni, you should:
- review your credit reports for accuracy,
- maintain a record of your inventory of financial assets (stocks, bonds, savings, etc.) to keep track of everything you own,
- keep important documents related to homes, vehicles, stocks, bonds, insurance documents, etc, in such a place where they can be found easily.
“You should also create an ’emergency medical fund’ of up to Rs 1-5 lakh (depending on your financial capability) in case you have unplanned expenses due to Covid infection,” says Soni.
“Further, you should continue your investments in mutual funds, stocks, fixed deposits etc as usual as the second Covid wave won’t last more than 2-5 months and these investments are more from a long term perspective. You can definitely cut down your exposure to some extent and divert some funds for the ’emergency medical fund’,” he further says.
Pranjal Kamra, Founder and CEO – Finology says, “The second wave of covid has not only hit our health but also our finances, which has brought us to the need of managing our money well in these tough times. So, making a budget according to the priority of expenses is the need of the hour.”
“Track down your auto-debits and filter out the unnecessary ones. Use online payment options to get cashback and vouchers while paying for your living expenses. But, do not go for retail therapy by buying unnecessary things just to use vouchers. The savings done from these measures should be added to your emergency fund,” he says.
“Revisit your health insurance to check whether the policy is appropriate to cover all the expenses. Also, cut the expenses on buying junk food. This will keep you healthy as well as save your money,” suggests Kamra.
Talking on the importance of health insurance, Anil Pinapala on Founder & CEO – Vivifi India Finance Pvt Ltd says, “You should be aware of your health insurance coverage and ensure that it includes Covid care, if not, it’s wise to get a top-up cover or a new insurance. This is the single most important step to protect your savings and if you don’t have any at the moment, consider having a saving of at least 3 months of your current salary, start instantly and ensure that you keep building the same. Being confident is the first step to fighting the virus and these measures will help greatly.”