Things to Do To Build a Stronger Financial Base during Lockdown
Staying inside the house is the best thing to do in the current scenario. While staying indoors may be frustrating for many people, it can be used to put a few areas of your life in order. One such area is your financial life.
If you have never had time to look at your finances, save more money, make a budget etc, now is the time to make it happen.
Find out how you can save more money
Are you one of the people who always promised themselves to save money so that you can actually have more money to do things that you want?
With the lockdown and termination of non-essential services, you can now easily figure out your unnecessary spending. You may have realised that there is no reason to dine out and go to the movies every other weekend. Cooking up a meal together with family or watching programs on TV and streaming sites can be fun and cost-effective.
You can also use the time to go through any auto-recurring debits and cancel any subscriptions that you barely use.
You can also use the extra time on your hands to track your past month's expenses. Our expenses can look hazy to us so it is important to open your bank account statements to check for spending that we can control and fix these plugs.
Taking all these steps can help us to save more money to build a greater emergency fund or invest money towards our financial goals.
Create a realistic budget
We all have made budgets at one point in time or another. How often have you adhered to it for more than a month? And not being able to stick to the budget, you may have given up on budgeting. However, having a budget is one of the most essential aspects if you want to keep your finances in place.
Budgets should be realistic and you should amend your budget from time to time to suit your present scenario. In this current circumstance, you may allocate more towards saving and investing than spending on your wants or luxurious items.
Brush up your financial knowledge
Are you always postponing learning about different financial products or having a fair understanding of the working of your investment? If yes, then it is time to change.
Allocate an hour or a couple of minutes every day to read up about mutual funds, stock markets and investment avenues of your interest. However, with millions of educative sites, choosing a starting place can be a hard one. To get authentic resources, you can ask your financial advisor for suggestions.
Or read the personal finance or investment book that you have bought aeons ago and is gathering dust in your bookshelf. You can call up your financial advisor to help you clear your doubts.
Check if pandemic diseases are included in your insurance policies
Few health insurance providers exclude pandemic and epidemic diseases from the insurance policy. Most health insurers are likely to give financial assistance for treatment of pandemic/epidemic diseases under the base policy which means that you may receive financial compensation on hospitalisation.
However, to be on the safer side, you can look at the policy documents or call up your insurance agent or advisor to know how well you will be covered under such circumstances.
Update your documents
To know the importance of updating your financial documents and keeping your family in the loop, ask someone who has recently lost their prime earning member. There are plenty of stories where family members had to undergo dire financial stress because they were not aware of the key information details or details were not updated. The family members have to undergo emotional and financial turmoil during these times.
To spare your family from the financial burden, make it a point to update your and your spouse’s financial documents such as communication address, phone number, nominee details etc. Check if the nominee details of your insurance policies and investments are updated.
Moreover, it is important to summarise all your investment details, insurance policies, fixed deposits, provident funds etc. in a notebook or in a soft copy that is accessible to your family members.
Also, make sure to keep all hard copies in a safe and waterproof condition and have scanned version of these documents so that you and your family can easily access when required.
The lockdown gives you ample time to sort out the different aspects of your life and financial aspect can be one of them. Use time wisely and build a strong financial base.