4 Crucial Money Management Lessons From the Novel COVID19 Pandemic
Tough times teach many things which help in the longer run. Let’s find out what are the critical lessons COVID pandemic has taught us:
- Insurance
Health care expenses are growing dramatically year on year. In fact, COVID-19 pandemic will make healthcare more expensive. Most employees are covered by health insurance from their companies but 90% are unaware of the sum assured which can be low in case you are affected by a major illness. It is always good to look for other options to improve your healthcare coverage.
2. Having an emergency fund is vital
Saving is always underrated as people only think about spending or investing. But the outbreak of Coronavirus Pandemic has brought uncertainties. So, an emergency fund is important in this situation as this fund can help you pay EMIs, bills. Thus, maintaining at least 6 months of salary in your bank account is absolutely crucial.
3. Important to create multiple streams of income
A sudden job loss can give rise to financial stress and the family’s future in jeopardy. So, it is necessary to have an alternate source of income. You can do this by investing in yourself and developing other skills. And at the same time, you can create assets that will continue to pay an income, like Real estate, bonds & Income generating funds.
4. Invest in equity related instruments, for long term wealth creation
Investing in equities is a smart way to grow your wealth but many people have lost a lot of their money who did it for quick short term gains. Stock markets can be thrilling but are not for the faint of heart. Start saving in ETFs and Mutual Funds and let a financial advisor pick the right asset allocation for you to mitigate risk.
The Covid-19 pandemic is teaching us many crucial lessons and one of the important things we have learned is that life is unpredictable. All we can do is prepare well, stay healthy, and be careful with money to get through these challenging times.
Abhishek Datta, one of the certified financial Advisors in Dubai, is helping many clients to survive in a tough situation. So, if you are affected financially by COVID 19, book a meeting with him. He will assist you to create an effective financial plan to get through this difficult time.
