5 Things to consider Financially during Covid-19

5 Things to consider Financially during Covid-19

In the face of both the Covid-19 (Coronavirus) and the Economic Recession, Financial Planning is Essential. It is important to note that every rupee spent unnecessarily in the current situation will affect the livelihood of others.

The Unexpected Demand for Food and Internet service is beginning to increase, although most of the other services are not present. Keep the Food items in your home only when needed, you can buy for a week. Don't waste the Good Food. It is best to prepare and eat only on Hungry, as needed. This will make the Food available to others at a low cost.

Staying home is not just idle, doing physical and Mental fitness for a while  encourages us to motivate. Focus on Good food - Nutrition and easily digested. Don't be fooled by the presence of TV, Mobile and other Tech Gadgets. You can create or work with your Favorite things at home, it's the time what you really feel in the past.

• Ignoring on Essential Commodities, will lead to the high prices. So, one should buy the things when really need and make it for the next few days. Be cautious on your Diet. Help others to avail the food at anytime.

 

• Make Internet use as low as possible. Use the Mobile Apps which required the Internet Data, as really needed. Currently, most of the people are taking work from home, so they really need the Internet Service as Mandatory. You can help them by using low as needed. Otherwise, it will reduce the Data Speed and also the reason to increase the Subscription fee by the Telecom Companies.

 

• Although, the Covid-19 is likely to decrease over the next few months (If expect like), but the Economic Recession is set to place for more months. Due to this, most of the people will lose their Day and Shift jobs. So deal this time with Austerity. Keep the money in cash or in Bank Savings Account - Cash is King in uncertainty times. Enable your Emergency Funds.

 

• Individuals who are going to invest in Stocks or Equity oriented Funds, should take appropriate Term Insurance and Adequate Health Insurance before Investing. Till date, most of the Insurance Companies covered the Policies for Covid-19 Cases.

Investors in Direct Equity and Mutual Funds should be careful and stick with them for Long term needs. Don't speculate this time and you will loose the money in the Market. For Short to Mid term needs, one can use the Debt Funds with a low risk.

Getting Term Insurance, Mediclaim and Emergency Fund Creation is necessary for the Investing. While you are ready to invest in Stocks, ensure that the shares you buy is  a Low Debt or Debt Free Company. The Debt to Equity should be less than or equal to 0.5 times. It is important to note that how the Cash Flow statements are there. Don't forget that the companies are having High debt and unable to pay their employees' salary(Cash Flow) will disappear in the Global Recession. 

It's not the time to make profits. Even the Fundamentals of the Company is good, during Lock down they cannot generate Earnings. So, Fundamentals are mandatory for any business rather than High Margins on Sales and Profits. The Global Equity indices are consolidating and ready to fall with a Big. So, invest in a little on every crash of the Market, no need to hurry to put all your savings. Asset Allocation is Important now, you can choose the Metals too (Gold, Silver, etc). 

• While investing through SIP route, Don't stop your SIP investments in this scenario. Try to add more to your Systematic investments, if possible. So that you can get more units on Low NAV(Net Asset Value). Only if there is a problem with your regular income, you can reduce the SIP amount - but your Financial Goals are important at any cost.

Since, interest rates are declining in the Banks and it will follow to fell in the upcoming months. One can choose Debt Mutual Funds with a low risk for their short to medium term needs. For any quick or emergency needs, better to hold in your Bank Savings Account.

Social Distancing is a needed one, Life without Debt is a Heaven - It is important to reduce the unnecessary cost in the years to come. The World is Changing and the Life style is also converting into Minimalism !

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