Corona and Personal Finance..Which approach to follow?

Corona! What seemed to be an epidemic has become a Pandemic now. Everyday, we are getting new updates about it.

A man can do anything but when it comes to its own health concern, all major things halt. This pandemic has resulted in world economy and all major markets suffering.

Markets are going Red and this creates a concern to all.

But, Health comes first and so governments have been monitoring the healthcare scenario, medical facilities, quick response to patients who need medical care.

‘Social distancing’ is one of the important measure that government has widely implemented for its citizens. Social media is creating awareness about it and what not!

Whole world is united to fight this and hoping to come over this pandemic.

But, what about our personal finance? When its come to safety and good health, profits and urge to earn higher returns take backseat.

However, all investors are feeling blue about their current portfolio returns and market performance. So,what we all can do and which approach we can follow when it comes to our personal finance and more?

Don’t time the market now:

No one can predict exact ‘high’ and ‘low’ of the market. People usually follow ‘buy low and sell high’ strategy. But, this market doesn’t seem suitable for this.

We are in the middle of the crisis now and difficult to predict where it will lead to. So, don’t time the market.

This crisis is directly hitting the manpower and so countries are busy in health protection and safety measures first.

So stay put. Don’t take any hasty decision right now.

keep calm:

Its very important in current markets. I always recommend investing as per your set goals, risk appetite and investment tenure. If you have invested by following these basics, and your goals are long term, then please don’t panic.

Review your short term goals investments :

If you have made any investments for your short term goals or if your goal period is coming to end soon, then please have review at the earliest. Please take help of the expert professional if needed.

Make for contingencies:

‘Contingency fund’ is important and a strong pillar of your personal finance. Production capacity of many manufacturing units have been affected, many salaried people are thinking about their regular payment of salary and what not.

In such situation, if you are falling short of money, then please use your contingency fund. If you still have not made any, then create one now!

Ideally, You should have total of six months of expenses as your ‘contingency fund’.You can invest this amount in liquid fund or can make short term FDs.

Discuss and help each other:

Many a times, people invest in wrong instruments which are a mismatch to their risk appetite. Here, in such scenario, they feel negative about investing in general and stop their investments or redeem at losses.

Well, if you know any of them, please have open discussion about markets, investments and guide them about it. You can help them to find an expert professional who can drive their investments and personal finance in right direction.

Not only in personal finance,but lets help each other to stay safe, healthy and protected in this situation. Specially , elderly people who have their sons and daughters in another city or country.

Focus on goals:

When you make goal based investments, your focus must be on those goals. Investing is a life long journey.

If your goals are long term, then in this long journey, situations like this will come. They are part and parcel of it. But, you must focus on goals and act accordingly.

Review your investments but don’t loose focus.

Continue with your SIPs :

If you have existing SIPs, then please continue. SIPs are meant for a regular and disciplined way of investments. If end of goal period is 5+ years away, if your have invested in a fund as per your set goal, risk appetite and investment tenure, then keep calm.

Random investing is a big ‘NO’:

Due to low prices of many stocks, and low NAVs of many mutual funds, people look forward to invest their surplus money now.

In such situation and in general as well, ‘random investing ‘ is not justified.

Always invest as per your set goals, risk appetite and investment tenure. Just because you have surplus, don’t invest randomly.

Have your health and term insurance ready:

The importance of Health and term insurance is highlighted during such situation. In this situation, please be safe, take all precautionary measures, but be ready with your insurances .

If you have a premium is due, or the policy is due for renewal in case of health insurance, then please pay for it.

Take a note of this and plan your finances accordingly:

A financial plan helps you to make way for contingencies, protect your wealth and loved ones by taking right and suitable health and term insurance for you and investing as per your set goals, risk appetite and tenure.

A financial plan assures you in times like this and your financial planner is always ready to discuss your concerns if any.

This time, take a note of it and get your financial planning done.

Our life and health is a priority. Personal finance and investments are part of our life. Personal finance and right financial plan help us to lead life with meaning. Please prioritize your health and safety in such situations. Lets helps each other, follow what our respective government asks us to.

Lets win over this situation together!

Leave a Reply

Your email address will not be published. Required fields are marked *