Well, the quarantine is over. It would seem that you can gradually return to your normal life. But many are wondering: what next? Should we wait for another wave? What lessons can be learned from this crisis? How do you get confidence in the future because life can bring anything? COVID-19 has taught us a lot, and this new experience is worth taking on board.
The Basis of Well-Being Is Financial Security
The pandemic has once again shown that a crisis can occur unexpectedly and quickly cover the entire globe. And to feel more confident, especially during periods of instability, you need to follow a few rules.
Provide Yourself With a Financial Cushion
We do not know when the next crisis will occur and with what it will be connected. But, as you know, people are more likely to lose their jobs as their incomes fall during such periods. And if at the same time they have urgent unplanned expenses, the situation may worsen even more. That is why it is better always to have a margin of safety – a financial cushion. Its size should be three, or better – six monthly budgets. You can consult a financial expert to guide you.
Insure Your Life
The pandemic has shown that health must be valued and protected. And so that a family, faced with a dangerous illness, disability, or, God forbid, the death of one of its members, does not lose financial stability, you need to have protection.
By protection, I mean life insurance with coverage in case of death, disability of the 1st and 2nd groups, and the diagnosis of dangerous diseases. Insurance must cover deaths from any cause, not just accidents, and coverage for these risks should be equal to the family’s income for at least one year, and preferably three years.
Calculate a Comfortable Credit Load
The size of payments on all debts should not exceed 30% of monthly income so as not to miss payments even in a difficult financial situation. Do not count on a credit or mortgage vacation – there may not be any. In addition, when reducing the Central Bank rate, it is recommended to periodically study the possibilities of refinancing in order to reduce loan payments.
Protect Property and Liability
Special insurance will allow you to pay large expenses in the event of material damage or loss of property, including through the policyholder’s fault. As they say, trouble does not come alone, and difficulties in business may well be layered on the flooding of an apartment, and even not your own, but a neighbor’s. Therefore, the policy must cover the cost of cosmetic repairs or replacement of the insured property.