10 money tips after surviving COVID-19

Posted on Apr 17, 2020 by Staff Writer

Rateweb | South Africa

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Covid-19 has created panic and everyone is wondering about what the future hold for us.

The markets are down and it seems like there is little hope. As of 17 April 2020 the South African Rand is 18.84 to the US Dollar

However, not all is doom and gloom, RMB Global Markets Strategist John Cairns said “After every blowout, the rand has always recovered… Our year-end forecast is R15.50…”

What next for South Africa?

South Africa has gone through worse. Future is even bright than it may seem at the moment. The government seems to be working tirelessly to cushion. However you should keep in mind, it is never a good idea to budget based on Government.

See the Historic GDP growth


source: tradingeconomics.com

The private sector has also jumped in with vigor and energy to help the country sail through this pandemic. The banks have given us payment holiday on loans and other credit.

Everyone seems to be working together to defeat the common enemy and that’s what life is all about at the moment.

After Covid-19 it will be back to normal. The key takeaway from this period this period is that money is important.Many without savings are struggling to make means meet because of this lockdown.

We have written 10 money tips that you can make use of after surviving COVID-19.

Here are the 10 money tips that you can make use of:

1. Create an emergency fund

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Covid-19 has shown us the importance of saving money for rainy days. Chowing all your earnings on expenses won’t help you in the future. You therefore need to start a fund that will ease your financial burden during hardships.

You definitely need to start an emergency fund for you and your loved ones. The fund should exist to cover any expense that may arise out of the blue. We live in a world of uncertainties and, therefore, we need to keep up with them.

Your emergency fund must be able to cover your expenses for a period of 6 months. It’s not going to take a day to build an emergency fund to the state that you desire it to be. You therefore need to have a budget and prioritize your emergency fund.

Do not find yourself spending your emergency fund unnecessarily. You should not use the money unless it’s an emergency. You will need to be self disciplined to achieve this. If you are not self disciplined then your emergency fund will be in danger from you and that’s the last thing you want.

Encourage yourself to be self disciplined if you are not, assess yourself by looking at your daily lifestyle

2. Create a Savings Account with good interest

Create a Savings Account with good interest

You need to have a savings account. You can’t live from pay check to pay check. It’s a must that you put some money away so that you can buy yourself things that you want the most in the future.

You will need to decide how many percent of your monthly income you will put on your savings. George Clason in his book the Richest man in Babylon recommends 10% of your income after taxes as savings.

How much you save largely depends on how much you earn However it should never be less that 10%. The high you earn the higher your savings percentage.

3. Make use of the 24 hour rule

If you are looking to buy for something that is not essential you might as well use the 24 hour rule. You can wait for 24 hours to make a decision to buy your non-essentials.

Impulse buying can destroy your whole budget, just because something is on sale it doesn’t mean you have to buy it. You need to be sure that you really want to buy whatever that is in question. Chances are you don’t even have a use for that thing that you think you want the most.

The 24 hour rule reasons that if you thing about the thing you want to buy for at-least 24 hours , you are most likely going to make much more informed decision.

4. Create a monthly budget

personal loan calculator

If you want to manage your finances like a professional then a monthly budget is a tool that you need. A budget is meant to keep you in check. If your budget is detailed you won’t overspend on anything. Your budget must be SMART (sustainable, measurable, attainable, relevant and time bound). Your budget need to be realistic. Apportion every bit of your income and be specific about where the money will go. This will help you monitor your spending habit and whether or not you are making right decisions as you had intended.

5.Unsubscribe

You are probably getting a lot of emails and SMSes about coronavirus specials from tens if not hundreds of companies. This need to stop, you need to unsubscribe from these companies so that you can implement your budget peacefully.

You are a human being at first so seeing all these adverts can make you irrational and make changes on your budget.

This is something that you don’t need because tempting offers may lead to you buying things that you don’t need.

6. Check your credit report consistently

Credit

Your credit report represents your financial health and as such you must prioritize on it. You are entitled to a free credit report at least once a year so make use of this and see how lenders view you.

Checking your credit report will enable you to see inaccuracies in your credit life. Consequently you will be able to manage your credit score and fix everything that needs fixing on your credit report like disputing an unauthorized credit check.

If you keep a good credit score you will be better position to access credit and loans from financial institutions. To increase your credit score you can auto pay your bills, limit your credit usage and not taking too much credit.

7. Refinance your mortgage

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You might be paying more interest for your mortgage than you are supposed to. Shop around and see if you can’t get a bank that can refinance your mortgage for a lower interest.

With a good credit score you are bound to achieve better or reduced interest rate for your mortgage. Before going to a different bank you can start from your current lender and ask for a review on your mortgage loan so that you can pay less interest rate.

You can definitely achieve this depending on how you will negotiate with the lender.

8. Get a medical aid

Medical Aid

Your health should be your number one priority. After all said and done if you get sick and not get help then you won’t be able to retain your income. Especially with the covid-19 outbreak investing in your health makes even more sense.

Paying 2% of your monthly income to cover your medical aid premium is all worth it for you and your family.

9. Start saving for your retirement

Processed with Focos

You may not get rich and retire in your 40s but you can still salvage your income after retirement with an investment in annuities.

10. Create a family spending limit

Create a Savings Account with good interest


Organised your family financially by having a spending limit in place. Don’t go off budget for any reason but at the same time make sure that everyone has enough. This should be your family culture and should be communicated to everyone.

Money has become our essence of life. The more money you have with you the better are your chances of happiness and enjoyment. Use your money wisely so that money doesn’t become one of your problems

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