The stock market has recently taken a nose dive of 9.5% (at time of writing), no thanks to the pandemic that is sweeping round the world. So how do you manage your finances during this health crisis?
Affected folks are self isolated or quarantined. Some schools are closed, and gatherings are discouraged. Your blood pressure rises just by reading about what’s been happening in different parts of the world.
What do all these mean for ordinary folks like us?
The cost of medical expenses related to this outbreak is threateningly real, as opposed to just watching from the sidelines when it was occurring in the East.
And we’re not just talking about being tested for the virus. What about the cost of medical care?
What about folks without medical insurance? What about those who live from paycheck to paycheck with no emergency savings? Or wage earners who aren’t paid if they don’t work?
Truth is, no one knows how long this global health crisis is going to last. But there are things we can do to protect ourselves and our finances during this trying time.
The most important is to make our best effort to take it in our stride and not give in to our fears. Fears that lead normal folks to acts of irrational behavior, as in hoarding toilet paper.
Now is THE time to keep a close watch on your health and money habits.
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These are the most practical money saving tips you can take during this outbreak. I have also included practical daily habits you can take to protect yourself and your loved ones.
#1 Minimize eating out
If you’ve always wanted to cut back on saving money by not eating out, this is the best time to do it. If you want to look at it positively, this outbreak may well give you that much-needed boost to give dining out a wide berth.
Don’t be tempted by food deliveries though. Have you considered the health of the cooks who prepare your meals? What about the state of health of the deliverers?
Tip: Buy frozen meals, easy-to-cook meals like ramen, pasta, ready-made soups. Or try your hand at making simple low-cost meals.
Get my easy dirt cheap recipes to make at home for when you’re broke. Besides filling your stomachs, they’re cost-effective too.
Buy foods that’ll last for several months like canned foods, bottled water, frozen meal, staples like pasta, flour and rice.
Here’s the link to some simple staples below.
#2 Buy generic
In our frugal living posts, we have always advocated buying generic brands. In this instance, buy generic medicines like paracetamol, cough mixture and lozenges, which are much cheaper.
Virtually all our local supermarkets, pharmacies and departmental stores have run out of sanitizers.
Tips: Stock up on soaps as they’re cheap or, make your own hand sanitizers.
We had to search in hardware stores online for the main ingredient to make our own hand sanitizers.
You just need 3 ingredients to make a simple hand sanitizer. I’ve included the links for your convenience.
If you need spray bottles, have a look below.
Use my 69 grocery tips to save money on food and groceries
#4 Eat cheap, nutritious foods
Nutritious foods such as beans, potatoes, and vegetables in season like cabbages are good choices.
#5 Don’t give in to fear and sell your shares
If you don’t need the money and can afford to keep your stocks, ride out this short-term fall. Try and ignore the effect of the virus on your stocks. Remember that it is only a real loss if you sell. Hold on to your stocks, as it’s likely that the market will recover in the long term
#6 Real Estate
It’s safer and wiser to hold off buying or selling your property during this time.
What I’ve realized is that things are now happening in shorter periods of time. Keep monitoring the news for the latest developments.
Selling your home may not be the best time now, as it exposes your sanctuary to strangers who may unwittingly be in contact with your home items, whether they’re door handles or just touching any items in your home.
#7 Start or Boost your Emergency Savings
If you’ve been meaning to start an emergency fund, NOW is the time. Why? This is a national emergency. And have you thought about the risk of being told to take a few weeks’ of compulsory no pay leave?
You don’t need the mandatory 6 months’ worth. Any amount is better than none.
If you live from paycheck to paycheck, this emergency fund can mean surviving the cash shortfall or incurring more debt.
Already have an emergency fund? Great! Keep adding to it and boost the amount in it. It’s always good to have a growing emergency fund.
#8 Set aside some cash for short-term emergencies
In the face of so many things that are happening, it’s easy to overlook this.
During this period, it’s crucial to set aside some cash just in case the local situation makes it difficult for you to access your money. For example, banks may be closed due to lock downs. ATMs could run low on cash.
#9 Travel Tips
Even if you’re young and healthy, the health advice is to minimize your travel plans.
Don’t be tempted by cheap travel deals, including super cheap airfares and cruises.
They are NOT worth the cost to your health.
With things changing fast, some folks are finding it hard to get refunds on their airfares and travel insurance meant to cover medical emergencies such as these.
#10 Keep comparing prices before you make purchases
Resist panic buying online. Don’t buy face masks or medicines before you’ve researched the prices.
Some private sellers online are exploiting the need for masks by increasing the prices of face masks. In my area, a box of 20 surgical face masks is selling for almost $282.
#11 Don’t overreact by overbuying
Prepare a list of essentials including food and medical supplies you and your family really need, just in case there’s a need for self-isolation.
Don’t be swayed by what you see on the news – folks scrambling for toilet paper, shelves stripped bare and super long queues at supermarkets. Remember that the news tends to focus on the dramatic, to attract more readers, listeners and watchers.
Our herd instinct is at its peak as our own survival instinct kicks in.
If you’re heading for the toilet paper aisle, pause and ask yourself, could you be influenced by what you’ve watched on the news?
#12 Be Contactable
Keep your phones charged and be contactable, especially to your employer and loved ones.
Times are uncertain and things can change suddenly, so make sure that significant others are aware of your well-being, movements and whereabouts.
#13 Avoid crowds and physical contact
Remind yourself not to make any physical contact with others, such as handshakes or hugs.
This is not the time to be concerned that you’ll hurt your friends’ feelings. Most sensible people would be understanding. By the way, if they should take offense, they’re not your real friends.
The current health outbreak has been unsettling as many countries have underestimated its impact. No one knows the long term effects this outbreak can have on our finances, society and lifestyle.
But let your head rule your heart – you will be able to make sensible and logical choices. Make sure that you keep your health and finances intact in these times of great uncertainty.
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