5 Tips for Juggling Your Finances Better During COVID-19

From jobs to savings funds, the COVID-19 pandemic has upended Filipinos' personal finances. While many people are still employed, some have been entirely laid off or lost another source of their income. Chances are, their savings and emergency funds have run dry due to the unforeseen global health crisis.

During these trying times, it's crucial to pay close attention and devise a good money management plan. You have to be extra careful about how you spend and budget to help you survive this ordeal.

If you feel like you're stuck in an endless cycle of living paycheck to paycheck ever since the pandemic began, you've come to the right place. This article will provide money management tips to handle your personal finance better and find some stability in this crisis. 

1. Reconsider your debt repayment strategy
   
   If you have ongoing loans, talk with your bank or financial institution if it's possible to refinance at a lower amount. The government rolled out Bayanihan 2 Law, citing that the public is allowed a 60-day grace period for paying loans, such as credit card payments, to provide some relief to their financial burden brought upon by the pandemic.
   
   The law reads, "All loans may be settled on staggered basis without interest on interest, penalties and other charges until December 31, 2020, or as may be agreed upon by the parties."
   
   When in doubt, you can always reach out to your bank to talk about refinancing options. If you have credit card loans, try asking if the bank can waive the annual membership fee. That's one less financial burden you can ease yourself of.
   
   
2. Create a budget for essential needs
   
   The most important step you should take during this time is to take a hard look at your finances and create a budget based on your assessment. You need to limit your spending on luxuries and instead prioritize your fixed and essential expenses, such as utilities and groceries.
   
   Since you're spending more time at home these days, you'll find significant financial changes, so you’ll have to redistribute your budget to the right allocations.
   
   Transportation, gym classes, dining out, social costs, and other expenses you usually carry out whenever you're outside have likely gone down. Reallocate these funds to your grocery, savings, bills, emergency fund, and debt repayment budget. The unexpected has already happened, so it's only logical to prepare for any further uncertainties. 
   
   
3. Commit to your weekly or monthly budget
   
   Now that you have a budget, the difficult part comes next: sticking to it. A lot of budget plans fail because people end up not following them. Since you’ve been spending hours on end scrolling through your phone, you might be seeing targeted ads and end up shopping online conveniently. But, during this time, it's crucial not to give in to instant gratification.
   
   It may be tempting to buy the latest gadgets or trends with the money you managed to save up. However, now’s not the time to be reckless with your spending. You may have been able to cut back on gas or coffee expenses, but it's essential to make every peso count. Monitor your spending habits, prioritize your payments in order of importance, and keep your costs under control.
   
   
4. Pay yourself first
   
   Every payday and after you've paid off your loans and bills and utilities, make sure to put money in your savings fund. Having a savings plan is vital to include in your budget, for this can help you on rainy days or when you need to cover unanticipated costs.
   
   Once you've reached your savings goal, which you can dedicate to investments, you can start building your emergency fund meant for financial shortcomings. You can allocate more money to these funds by cutting back on your nonessential expenses and reallocating the extra funds to these.
   
   
5. If possible, invest more
   
   If you're financially capable and you think you're ready to grow your money, it may be a good idea to dip your toes in investments. Since the economy has experienced significant downturns due to the pandemic, market rates have been remarkably cheaper compared to pre-pandemic times. You can buy low today and grow your money.
   
   Note that there's always a risk when investing in stocks, bonds, cryptocurrencies, and investment options. Make sure to consult a financial advisor and diversify your portfolio for higher chances of success.

Spend less, save more, and budget wisely

The COVID-19 pandemic may have gravely affected your personal finance planning. But know that it's never too late to get things sorted out and prepare for the future. Money problems are always a cause of headache. Remember to remain calm when handling your finances to avoid further stress.

Moreover, learning how to manage your finances better shouldn't be the end of your money management journey. If you find a side hustle to earn extra income, don't miss the opportunity.

If you're shopping for insurance for your peace of mind and your family's, BPI AIA makes it convenient to get insured despite the pandemic. Schedule a virtual appointment with one of our Bancassurance Sales Executives to learn more!