As well as putting hundreds of thousands of people through pain and heartbreak, the Coronavirus crisis has put peoples’ bank balances in jeopardy. If you haven’t experienced COVID-19 symptoms, you’ve probably still been impacted via a lack of earning opportunities.
With a global recession expected in the short-term, there’s no doubt that the Coronavirus pandemic is money-related as well as health-centric. As a result, everyone can take powerful money lessons from the past couple of weeks that will stand you in good stead in the future.
Hopefully, the following will safeguard your family’s finances should a second wave hit, or a new crisis occurs.
Save, Save, Save
Previously, there was a change in the guard as more households stopped saving as much and invested their nest eggs instead. While riskier, the risks are few and far between if you spend cleverly, and the returns are often two, three, or four times higher. As a result, creating a sizable rainy day fund may not appear as appealing as channeling your funds into investment opportunities.
Investing is undoubtedly an incredible way to enhance your wealth, yet it does tie up your liquidity. Therefore, you still require emergency savings big enough to cover your expenses for three to six months.
Don’t Overspend On A Vacation
Vacations are no longer perks – they are viewed as basic rites. Almost 100 million Americans went on a holiday in 2019, and more were expected to go this year until the crisis hit. Not only did a cluster of COVID-19 cases occur when Americans went abroad, but the cost is very high. You can expect to pay thousands of dollars for a week or two in Europe, which is a huge amount. Yes, a holiday is an excellent way to rest and recharge your batteries, but you need to factor in the expenses, too.
You may, for example, try and be more financially responsible when you reach your destination instead of using a vacation as an excuse to splash the cash.
Create Comprehensive Coverage
Insurance companies haven’t covered themselves in glory during the health crisis. Rather than pitching in like everybody else, they cited reasons why they wouldn’t pick up the bill. If anything, this proves the necessity for comprehensive policies that cover you regardless of the situation. Otherwise, you may find yourself being unable to pay for medical bills or travel fees to return home.
You can do this by doubling up on your insurance.
Prepare A Will
You have no plans on going anywhere anytime soon, and most people who contract COVID-19 only experience mild symptoms. Still, this pandemic has probably made you think about what happens should the worst-case scenario happen. Of course, the last thing you want is for your family to mourn your passing and run into financial trouble, which is why a will is critical.
Writing one will prevent any confusion as to who gets what and why. Plus, you can tweak it at any time to reflect your preferences.
What money lessons have you taken from the Coronavirus pandemic?
