It is no secret that COVID-19 has left economic, social, and financial hardships in its wake. The extended lockdown period has caused many to lose their jobs, and some businesses have been forced to shut their doors forever. For those whose lives were not as drastically affected, the awareness of financial hardships amidst a waning economy is still very present.
If you are stressed about your finances at this time, below are a few helpful tips for sensible financial planning into 2020 and beyond.
Set Financial Goals
Financial goalsetting is a crucial part of any plan, no matter what state the economy is in. If you don’t know what your financial goals are, it can be difficult to set targets, plan accordingly, and save for your future. Financial goals can be anything from setting aside for retirement, planning your child’s education, saving up for a house, or investing.
Evaluate Spending Habits
Many people spend without really evaluating what their habits are. So long as the bank account is healthy, it’s ok to buy what you want, right? Not necessarily. Taking stock of what you spend and why can be very revealing and enable you to plan better. For example, are you spending because you’re bored? Or because you feel you have to? The task of evaluating spending habits allows you to match these up with your financial goals. If your spending and goals are misaligned, it is time to re-evaluate how and why you spend.
Assess Your Credit and Bank Account Health
It goes without saying that keeping on top of your finances requires regularly reviewing your credit status and bank account. This simple act means you’re respecting your finances. Make sure you check your accounts regularly and ensure you’re up to date with current and future payments. If your credit rating needs a boost, plan accordingly and figure out how you can build it up. What’s more, if your balance is lapsing into your overdraft every month, you may need to examine your spending more closely.
Get Insurance if You Haven’t Already
It might seem like a strange recommendation, but we don’t often think about the effect on our income in the event of an accident, disability, or death. Anything can happen in life, and if we haven’t taken the necessary precautions, the financial loss can be enormous for ourselves and our loved ones. If you haven’t looked into life insurance, or insurance that covers your home contents or business, experts at an independent insurance agency can advise you on what policies to take out at reasonable prices.
Set Aside an Emergency Fund
We’ve all been told to set money aside for a rainy day. This advice couldn’t be more pertinent in the current COVID-19 climate, where we have seen large numbers of sudden and unexpected losses. If you haven’t already done so, be sure to create an account just for emergency funds. A decent fund should cover between three and six months’ expenses to ensure you’re well protected.
The above-mentioned tips are just a few of the key steps you can take to start securing your financial future. In these current times of uncertainty, protecting your finances at all costs is not simply smart, it’s also a necessity. Good luck!