Covid-19 has caused some changes in how people bank, with the majority of the changes affecting how people spend money. Many people have cut back on their spending as they have become more conscious of their spending habits. As a result, money is being spent on much-needed household items and services.
We’ve learned a lot about Covid-19 and its health and financial consequences. Going forward, too many considerations must be made, and banking practices must change. Living from paycheck to paycheck must be a pre-Covid-19 habit that must be dealt with.
The world after Covid-19 will be different. We investigated how a post-Covid-19 world will look like, taking into account the financial hardships that many people have experienced. For those who wish to remain liquid in the future, we have devised strategies that will assist them during any difficult times.
Here is a list we’ve compiled of five banking and financial habits to adopt from Covid-19 in the future.
1. Earning An Extra Income
People used to be very reliant on their salary to provide them with the life they desired. Beginning in March 2020, a number of employees were laid off, and others took an unpaid leave of absence.
The days of relying solely on one source of income, particularly salary, are long gone. Covid-19 has forced people to look for alternative sources of income in addition to their salary. Now, people earn money by doing things like online gigs, part-time jobs, second jobs, starting a business, and investing.
One of the most secure ways to generate passive income is through a fixed deposit account. With a single lump sum, you can easily invest your money in an account that outperforms inflation. The fact that your capital contribution to the account is guaranteed is a plus.
2. Reducing Expenses
Maslow’s hierarchy of needs categorizes needs from level 1 to level 5. This hierarchy can be used to decide which needs are more important than others. Spending should be directed toward meeting physiological needs such as food, water, and shelter.
Prioritization of needs is critical, and physiological needs take precedence. We’ve seen a lot of changes in how people prioritize their needs throughout Covid-19. The most important expenses were food and water, and spending on entertainment was reduced.
Going forward, our spending culture must be revisited, and the spending culture adopted during Covid-19 must be carried forward. However, as the economy improves and people have more disposable income, things may change.
Investing, on the other hand, maybe a good option if you have more disposable income. Many people who have never considered it before will be able to create generational wealth.
3. Setting Clear Emergency Savings Goals
When it comes to Covid-19, one thing it has taught us is the importance of having savings in place at all times. Saving for emergencies such as a pandemic, financial crises, natural disasters, and so on must be prioritized in the future.
When establishing an emergency fund, a goal must be established. For example, it must cover rent for at least 6 months, groceries for 6 months, fees for 6 months, and internet for 6 months. An emergency fund with a goal or goals will allow you to save the money you will need to cover your emergencies.
Emergency savings are no longer a point of contention, but rather a necessity. You may believe that you will not be able to save for emergencies, but you can begin by saving a small amount of money.
A monthly contribution of R50.00 or R100.00 can be a good starting point. Make emergency savings contributions a habit, and increase your contributions as your income increases.
4. Reduce Travel Expenses
Traveling is one of the best ways to reward yourself after a long period of hard work. As appealing as it may sound, you should not, however, always travel to unwind or reward yourself after a long day’s work. There are other low-cost activities in which you can participate.
When you do travel, it should be done on a tight budget; you don’t have to go all out. Spending should be limited to your means and should not be extravagant. Make a budget and stick to it when you travel in the future.
5. Using Contactless Methods To Make Payments
Contactless payment methods have been used for some time, but have grown in popularity since the introduction of Covid-19. Contactless payment methods were popular during Covid-19 because they allowed people to transact without making physical contact.
Even after Covid, the adoption of contactless payment will occur. Banking technology will evolve in lockstep with the rest of the world.
Using contactless payment will assist you in preventing the spread of future and known diseases. Handling cash will become obsolete someday. Begin using your mobile devices to conduct transactions and become acquainted with this banking technology.
Many changes have occurred in the financial world as a result of Covid-19, and banking is now conducted in a different manner. Cryptocurrencies are now being used in unprecedented numbers, and our spending habits have shifted dramatically in a relatively short period of time. As much as Covid-19 has changed our society, a few good things can be adopted from it.