How To Prepare For

Financial

Stability

In Uncertain Times

· Finance,Business

If there is something we have all learned from the pandemic, nothing is certain. At a constant rate, people have lost their jobs and been kicked out of their homes for rent gone arrears. Such scenarios make one question their spending choices and whether they can weather another crisis. To ensure you are ready for uncertain times, here are a couple of things you can do:

Have a Budget

The most effective way you can know where your money is going is by having a budget. To ensure the budget includes the essential you will need to cut out non-essential things. Possible adjustments when making budgets are entertainment, restaurants, and excessive holiday spending. As much as you might enjoy these simple pleasures, you can do without them at least for a time. The money you spend on “wants” can be used in other more important areas.

Have A Savings

The one necessary cushion when life falls apart is your savings. For this reason, ensure that you save as much as you can now. You do not need a large amount of money to start saving. Start now, start small, make it a regular habit in your life, and soon you will not be struggling to save. Set a target for yourself on how much of your salary you will save and ensure you stick to it. In doing so, when push comes to shove, you have something that will keep you going until things get better. Savings accounts can also help improve your credit score.

Reduce Your Debts

Having financial issues while your debt accumulates interest makes life very stressful. Reduce stress levels by paying off your debts bit by bit. It might take a while, but eventually, you will get to a point where you have cleared all your debts. Mortgages can be stressful, and not paying them can lead to your house getting foreclosed. When paying off your debts, always ensure you pay off your credit cards first. Then focus on loans. Also be sure to pay your taxes as well. Defaulted taxes are worse than defaulted mortgages or other loans you might have accumulated. Have a list of the debts you have and plan how to clear them, from oldest to new. It will require discipline, but it’s worth it in the end.

Have a Side Income

If there is anything you should have learned from the pandemic, no job is permanent. To ensure you have a flow of income in the event of job loss, have a side hustle. It can be something you do as a freelancer or a fully operational business. If you want to ensure your job will not get closed down as it happened in the lockdown, provide essential services. You can never go wrong with a food joint or transport business. The pandemic also showed us that technology is the future. Tech companies gained a mass increase in usage from the online meetings. If you do not know much about technology, then this is the time to learn. There are free online courses you can take advantage of and learn new skills. You may not become a tech wiz, but learning will ensure that you can move forward as more of the world goes online.

Cut Down on Extra Spending

While it might seem unappealing, try to cut down on reckless spending. If you know you have an issue with online shopping, get an accountability to help you work on reducing excessive spending, and purchase only what you need. Where necessary, deactivate online profiles where you spend much the most money. Is going out a weakness? Find ways to enjoy yourself at home or locations that don’t require money being spent. Try reducing the number of times you go out with friends, and if you do, carry cash. Reduce viewership subscriptions. These might seem like a drastic measures, but you will be surprised by how much money you save.

As time goes by, the economic scales keep tipping against us. If you are not careful, you will find yourself unable to make ends meet. The only way to avoid this is by saving money, being intentional about your spending, and finding new ways to make money. By doing this, you can improve your assurance that the economic crisis will not affect you significantly.

References

https://njaes.rutgers.edu/sshw/message/message.php?p=Finance&m=237

https://www.blueandco.com/financial-planning-for-nonprofits-in-uncertain-times/

https://www.manulifebank.ca/personal-banking/plan-and-learn/personal-finance/tips-for-managing-money-during-uncertain-times.html