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7 Tips to Manage Money During Coronavirus

IndianMoney.com Research Team | Posted On Thursday, March 19,2020, 03:17 PM

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7 Tips to Manage Money During Coronavirus

 

 

7 Tips to Manage Money During Coronavirus

The deadly coronavirus is sweeping the World. The death toll is rising as nearly 3,000 people lost their lives in Italy. The global death toll is close to 9000. The death toll in Iran is nearly 1000. Australia, US, France, Italy and Spain have shut down. The hit on the global economy is unprecedented.

Back home in India the economy has taken a serious hit. The Nifty has sunk below 8,450 as stock markets bleed. There could be a 0.5-1% hit on the GDP. The Q3 GDP growth was already low at 4.7% and the worst is yet to come. In all this comes an important question. How to manage your money?

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See Also: How To Manage Money Without Regular Income?

7 Tips to Manage Money During Coronavirus

1. Get your emergency fund

The coronavirus is going to stay awhile and it’s time to take a serious look at the emergency fund. It’s wise to increase the emergency fund. Have at least 6 months of living expenses in the emergency fund. Increase this further in troubled times.

Will health insurance save you? Well, Coronavirus has been declared a pandemic. Many insurers won’t cover coronavirus related treatment. If you have adequate funds in the emergency account it would be very handy.

2. Repay loan EMIs digitally

Are you repaying home loan, personal loan or car loan? Well, pay the EMIs online instead of the offline mode. If your bank branch shuts down with coronavirus outbreak, you end up becoming a loan defaulter or paying late fees if you don’t repay online. Set ECS mandate for auto payments of loan EMIs.

3. Don’t stop SIPs

Well, this is definitely not the time to stop SIPs in mutual funds. You will easily get more mutual fund units at a lower price. This is the best time to average mutual fund units. Stick for the long-term and enjoy high returns from stocks and mutual funds.

4. Keep health insurance plan active

Make sure you pay the health insurance premiums and keep health insurance policy active. Now, if health insurers don’t settle pandemic claims there is nothing much you can do. IRDA has asked insurers to extend pandemic coverage to Covid19 hospitalization cases. Check with health insurer on terms and conditions for coverage of coronavirus pandemic.

5. Limit expenses

This is definitely not the time to spend. Curb those expenses just to the necessities. Make a budget which accounts for every rupee earned and spent. Postpone big-ticket purchases. Prioritize only the essentials and postpone all items you don’t really need.

6. Review all your investments

This is an excellent time to rebalance the portfolio. Take a look at the debt-asset mix. This is a time when debt is high in the portfolio as stock prices have crashed. Buy quality stocks at low prices and shore up the portfolio.

No matter what you do check financial goals, risk appetite and liquidity needs. If you are risk-averse it’s tempting to avoid equity. Don’t fall for this trap. Equity is an inflation-beater. It gives high returns over the long-term. So do maintain some equity in the portfolio.

7. Get life insurance

Well, in these troubled times a term life insurance is a must. This policy pays the death benefit to the nominees on death of the policyholder within the term of the plan. Get a term life plan as soon as possible and stay safe from the coronavirus.

See Also: How To Manage Money After Marriage?

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