#CORONAVIRUSUK – Managing your Financial Health
It’s no surprise to us that the Coronavirus is rapidly taking effect. It’s scary, right? There’s no denying that deep down, we’re all worried about our health, both literally and financially. Some might say, ‘it’s only the cold and flu, you’ll be fine!’ but as well as some of the serious factors, that doesn’t mean to say that it might not have an impact on your money.
With over 280 cases and at least 3 deaths in the UK, anyone with a cough or cold will soon be told to self-isolate as Britain is beginning to prepare for a significant rise in coronavirus. So, with that in mind, this could result in a financial hit – especially if you don’t have paid time off at work. It’s uncertain as to whether short-term disability insurance or the Family and Medical Leave Act would cover any lost income. For those not affected, the chances of spending money whilst self-isolating will be very slim - a perfect opportunity to save up!
The virus is dramatically having an impact on the economy. Holidays are being cancelled, fewer people are travelling, and stores and restaurants are no longer being visited. When people are unwell, they can’t work, and stuff doesn’t get done. Disruptions occur and it’s beginning to have a domino effect on various countries around the world.
With financial uncertainty, it might be a good idea to consider some useful tips:
When a pandemic like this occurs, it’s always handy to have an emergency fund. An easy-to-access savings of three to six months of your pay. You might be reading this and thinking, ‘I don’t have emergency savings, what am I going to do?’ The answer is to cut back on non-critical spending and put aside the money to start building your emergency savings up. You might also want to cut back on any extra payments beyond the minimums to debts that have interest rates of less than 10% so that you can set that money aside for emergencies if you need to. Or, it might be that you spend some time looking at your options for dept. This might include investigating what credit you have available to you – i.e. credit cards, personal loans, reverse mortgages etc.
If you’re one of those people that already have emergency savings in place, it’s a good time to review your spending. A crisis makes you think about what really matters to you - and that’s the key to spending more mindfully.
Don’t overspend. Think about what you’d want to have on hand for a couple of weeks while you’re unwell at home like herbal tea, tissues, cough sweets, cleaning supplies etc. (but don’t go and stupidly clear the shelves of Tesco).
Think about refinancing your loans
When interest rates go down, it’s a great opportunity to consider refinancing your debt at a lower interest rate, to save you money. If you own a home, you can look at refinancing your mortgage. If you already have credit card debt, now might be the time to look at consolidating it with a personal loan, especially if the rate would be lower than what you are paying on your card balances. If you take out a loan and don’t need to use your credit cards for any emergencies, it’s better to avoid using them at all. If you can help it, you don’t want to build those balances right back up again after you pay them off.
Update your CV and tend to your network
This is a smart use of downtime at home. We tend to only think of updating this stuff when it’s time to start looking for a new job. But it should always be up to date, particularly on LinkedIn, so people can know what you’re up to.
If you’re actively connecting with people and keeping your paths of opportunity open, this will help if you be prepared in the future if the job market flattens out. Also, if you’re actively connecting with people it might help you keep your sanity in times of stress and loneliness.
No matter what impact this virus might have, it’s always good to review your money situation and think about making it stronger. Since money is (usually) our source of stress, it’s a way of smart self-care in stressful times. And when you’re done: Stay calm and wash your hands.