Taking Care of Personal Finance during the Pandemic

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Hi all , I hope you are well and safe from the ongoing pandemic. Everyone is at battle in these times. Here is my attempt to highlight my experience of handling personal finance during last 4 months. 

Has the Pandemic times made you realize the importance of Emergency Fund ? 

The crucial times as such where our Income source is at sake. Inflation rate  continues to hike, but due to no pay cheque hikes this year that gap between our earning and expenses is increasing as time passes on

Emergency Fund help us takle these difficult times in case we get into situation of doing a emergency expense and do not fall into a trap.  Understand the definition of wealth explained in very simple but effective way by Robert   

#Wealth : The definition of wealth is the number of days you can survive without physically working and still maintain your standard of living 

Rich Dad’s CASHFLOW QUADRANT from Rich Dad Poor Dad 

Cash Flow Quadrant • 4 Ways To Produce Income Be careful what you look and  wish for…You just might… | Rich dad poor dad quotes, Cashflow quadrant,  Rich dad poor dad

No Job is secure!

We have to prepare ourselves for any possibility during the pandemic it’s talking point of all working class. Under circumstances, no job is secure. The need to have more streams of income is call of hour.

Also Read on FinMedium:  Is Mirae Assest Large Cap Fund a Good Buy?

Also read: How to generate passive income. 14 easy ways

I suggest one should mainly think on below aspects of our work to sustain in post pandemic world 

  1. Re-skilling of yourself as per new norms
  2. Re-Aligning of your career post Pandemic Time 
  3. Re-Vision of your Financial Future 

Expense Mechanism during Pandemic –

Aliging to new normal of working from home most of us are already used to be at home. This sudden change in our lifestyle has got us some behavioral changes in the context of expenses we do.

  1. Less Travel – No Office Commute, No  Trips , No Family Visits ,Fuel Expenses etc
  2. Leasure/Experience Savings – Reduced Outings, Movies, Shopping etc 

While living this new normal life our pre-covid assets and liabilities still continue to part of our balance sheet. So its important that we put our discretionary spends on hold and keep the expenses at the minimum 

Frequnent Change in intrest rates by Central Banks.

In response to the pandemic Central banks are changing the interest rates on loans as per economic situation. One should keep tab of this information and adapt loan assets to floating interest rates by paying conversions fees. This entire process will not only reduce your EMI amounts but also reduce your interest paid by the end of your tenure of main by huge amounts. There is no point in paying EMI on pre pandemic interest rates. 

Also Read on FinMedium:  Ian Cassel Talks MicroCaps and 100-Baggers on Chain Reaction Podcast

Insurances are need of hour 

Despite of uncertainty around our income and jobs one should always have a good curated Health and life insurance covered in order to deal with financial loss in case of any events.

One should not misunderstand insurance as investment. Always look for purposes of Insurance. 

Millennial population should take into account the fact that sooner you get yourself insured , minimum price you pay for it 

Pandemic doesn’t postpone your retirement ,Plan it anyway !

Considering the history of Pandemic in last two centuries on an avg it’s lasts for couple of years along with its prolonged impact on Human Population.This fact doesn’t change the retirement age of the working population during the pandemic. 

During last couple of months ,I have personally interacted with my close friends and family in working class. I found there is a common observation is people cutting off on the long term expenses. Reducing PPF/NPS contribution for the years .

On the contrary few of us have already used the scheme to withdraw our saved amount from EPF. By cutting short on this or delaying your planning on the long term goals as such as Retirement you will only lead to weak corpus at the end.

Also Read on FinMedium:  Market Update for 08/07/2020: – Street-fluence

Please don’t do this unless it’s of emergency. 

There is brighter side to this as well. Read  – NPS adds 1.03 lakh subscribers in Apr-Jun quarter – The Economic Times

Summary : Personal Finance is long process not taught in school to most of us ,Its something we learn as we grow with time. Provided one pays attention to it like we do for earning part of our life. 
-Anup Lamb 



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Prateek Goel
Co-founder of Investeek, Prateek has been investing in the stock markets since 2006 and has beaten the NSE/BSE on a consistent basis. At the age of 24, he was also featured in India Today for his expert insight on gold trading.
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