HomeBlogInvestorInvestment Made EasyRegulate Your Personal Finances During COVID-19 Pandemic

Regulate Your Personal Finances During COVID-19 Pandemic

The spread of Covid-19 and the lockdowns that have followed have thrown the economy and government finances into turmoil causing them financial stress, and people are worried about paying their bills. The pandemic has cast a long shadow of un ty. It is unsure how long it will take to restore normalcy plus revive the economic environment. Though COVID-19 will continue to have an adverse impact globally, a few smart decisions may help common people maintain healthy finances.

Re-assess your budget

Every well-managed household works on a pre-set budget. Usually, budget changes with changes in household income to ensure that expenses do not increase. They need to discern between needs and wants. It is crucial for households to take this decision for financial stability until the threat subsides.

Consider moratorium?

Take into account the fact that if one opts for the moratorium, the interest on their loan will continue to accrue, which will lead to increased EMIs or additional instalments at the end of their loan, or both. This is why, only those people who have significant cash flow constraints currently, should opt for a moratorium.

Avoid delay in credit card payments

Do not delay your credit card payments even during an economic full stop. Credit cards charge a high rate of interest on pending payments and directly affect your credit score. Hence, if there is a liquidity crisis, at least the minimum payments must be paid to avoid exacerbated bills later along with bad credit score.

Store but do not be extravagant

The lockdowns have made stocking up critical. However, hoarding and overspending on groceries is not a good idea. While it is wise to avoid supermarkets and crowded places, just buying enough supplies for a month should suffice. Governments across geographies are ensuring that there is no restriction on the flow of critical items and hence their availability will not be an issue.

Avoid panic selling

The freefall in global stock markets is making investors uneasy. As portfolios tumble, there is a strong impulse to sell stocks and minimise losses, but this is the worst possible course of action. By selling equities at a lower price, paper losses become real. The value of most stocks will stabilise when normalcy returns. Hence, they should hold out and wait for the volatility to end.

Save for rainy day

It is always advisable to have savings and an emergency fund. This fund can provide a cushion in trying times such as these. Households should immediately start creating such funds once the epidemic is over so that they are ready for any hardships in the future.

Following these few simple tips can help households weather the current storm and emerge from it unharmed. More importantly, when things get back to normal, they will find themselves in a stronger position with no extra liabilities. Furthermore, some of this advice can be helpful even in times. It is important to prioritise your expenses, focus on the ones which are an absolute must, and postpone any discretionary ones until the lockdown is revoked.


LenDenClub is India’s largest alternate investment platform which started operations in India in 2015. We have been helping investors diversify their investments beyond traditional investment instruments ever since.

About

Investment

The Reserve Bank of India does not accept any responsibility for the correctness of any of the statements or representations made or opinions expressed by Innofin Solutions Private Limited, and does not provide any assurance for repayment of the loans lent through its platform.

LenDenClub is an Intermediary under the provisions of the Information Technology Act, 2000 and virtually connects lenders and borrowers through its electronic platform via the website and/or mobile app.

The lending transaction is purely between lenders and borrowers at their own discretion, and LenDenClub does not assure loan fulfilment and/or investment returns. Also, the information provided on the platform is verified or checked on the best efforts basis without guaranteeing any accuracy of the data/information verification. Any investment decision taken by a lender on the basis of this information is at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower, fully or partially. The risk is entirely on the lender. LenDenClub will not be responsible for the full or partial loss of the principal and/or interest of lenders’ investment amounts.

 

*P2P investment is subject to risks. And investment decisions taken by a lender on the basis of this information are at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower.

** Average value mentioned is the weighted average of returns received by investors

© 2023 LenDenClub by Innofin Solutions Private Limited | CIN: U74999MH2015PTC266499