It is no doubt that the onset of COVID-19 pandemic has had a tremendous impact on the global economy both at a micro and macro level. For many Indians, the COVID-19-related financial impact ran in two extreme direction. Those who lost employment because of the lockdown measures, or saw their wages diminish due to the reduced hours and business closures may have faced immense financial hardship because of drained savings and mounting debt.
On the other hand, those who continued to hold on their jobs and get regular pay cheque may have seen their savings grow because there was nothing much to spend money because of the extended periods of lockdown. Now, as the lockdown is slowly being lifted, and the economy is steadily recovering, it is vital that you reconsider your financial goals and think about the post-pandemic savings plan based on how the pandemic has affected your finances.
The following tips can help you with savings for the future.
- Create a pool of emergency funds
One of the best ways to ensure financial security for you and your family during the hard times like the Covid-19 pandemic is to have a pool of emergency funds that you can utilise during an emergency. Setting aside an emergency capital can help you save for the crisis that may arise in the future and help you accomplish your long-term goals.
If you are a business owner or if you have started a new job, the first steps towards your investment journey should be building an emergency fund. You can look for best savings plans with a longer investment duration and assured returns. You can consider starting an SIP or invest in RD or ULIPs.
- Have a long-term plan
If you have drained all your savings during the pandemic, you may be keen to build your corpus at the earliest. However, with the pandemic, you may have learnt that uncertainties can affect us severely and financial crisis can occur at any time and to anyone. Hence, it is vital to focus on long-germ financial planning.
Having long-term goals will not only help you slowly build wealth but also help you be better prepared to weather financial crisis that may occur in the future. However, it is advisable to be flexible in your approach. Savings is not just once in a lifetime thing, it is a continuous process, and you must alter your goals based on your changing financial circumstances.
- Invest in a guaranteed savings plan
The pandemic has shown us all that the unfortunate events can affective everyone irrespective of the socio-economic status. None of us would have every predicted that something like the COVID-19 pandemic will wreak havoc in our lives.
And, since everyone is affected equally, it is advisable to stay prepared instead of hitting the panic button during troubled times. Now, you may be aware that a savings plan is essential not just for tax-saving purposes but also to build a corpus. Investing a guaranteed savings plan will not only give you the full security of your capital but also allow you to enjoy tax-benefits.
You can take out the capital as a lumpsum and ensure that your family financial needs are met even during an unfortunate event.
The COVID-19 pandemic has been a wake-up call for all citizens to take their financial planning and savings for the future seriously so that we don’t face any hassles if something like this happens in the future.