Many countries in the world have started with various attempts to separate humans from each other. It could come in the form of social distancing, working from home and quarantined. It seems like a global emergency is just around the corner and we are scrambling to prepare for this emergency. The Singapore government just announced a SGD$55B Resilience Budget package to help Singaporeans tie over this period.
Is it too late to prepare for this emergency?
From the Oxford dictionary, Emergencies are serious, unexpected, and often dangerous situation requiring immediate action. I feel the most defining thing about emergencies are that they are unexpected. Looking back, the reason why COVID-19 went out of control is that not many believe it to be serious and so it becomes unexpected.
While governments out there are trying their best to take care of their citizens, is there anything we can do during this emergency? And is it too late to prepare for this emergency?
Keep Calm and Prepare
Wealthdojo is a personal finance blog and so the suggestions will be finance related. We do understand that being mental strong and physically healthy is important in this period, but that’s an article for another day. It doesn’t matter where you start, it only matters that you start now. Here are some financial preparation that you can consider in this emergency.
- Emergency Fund
This is the bedrock of your financial planning. When your income source stops (in normal days, it could be a lost of job), bills will continue to pile up. You will still need to eat, have a roof to stay and also feed your dependents. COVID-19 has pressed the pause button for millions of people in the world. Look at Singapore Airlines, senior management pay cut by 10-15%; staff offered voluntary no-pay leave. This would mean that the employees income source will take a pause for this period of time. If they do not have an emergency fund, how will they be able to continue to feel themselves in the months to come?
Solution: Have an emergency fund of between 6 to 9 months of your expenses.
This will ensure you can continue to live your life while waiting for the situation to be better. (Read more: Life Hedge: How to prevent your life from being a roller-coaster (Part 1))
Call me bias but this is the most important time to review your insurance portfolio. Insurance takes care of medical conditions that are often unexpected (who can predict that they will have an heart attack) and serious. COVID-19 just serves as a reminder that health is the most important asset that we will ever have and COVID-19 is just one illness out of the whole repertoire of potential illness. Why are we resisting on planning for the other illness when they will rob us our ability to earn in the years to come?
Solution: Review your insurance portfolio
This will ensure you can continue to live your life while recovering from your illness. (Read more: Life Hedge: How to prevent your life from being a roller-coaster (Part 2))
- Learn new things
There are so much information out there and I can never say that I truly know everything. In the midst of a crisis, the most important thing is to learn or even relearn certain things. It could be range from things like “how to maintain your relationship with your neighbor” to “gardening”. For Wealthdojo, we believe in continuous learning and reading. We have specially prepared 2 things for you to learn and explore new things during this COVID-19 period.
We will be having our first ever CPF Webinar on 23April2020. Do join us to learn more on what you can do with your CPF in the next webinar.
The last one is dedicated to all the investors out there. It is bargain season in the stock market now. Many companies are now priced at historically low levels. However, if you don’t have a game plan on what to buy and what price to buy, be prepared to let opportunities slipped away from your hands.
Wishing you the best in this period of time. We hope that everyone can remain calm and healthy during this season. It is a season of crisis but it is also a season of opportunity. Invest with what you have and don’t borrow money to invest in this period of time. If you are new to investing and need help, do talk to me using the contact form or any methods listed below.
If you read until here, thank you again for your patience and your support over in 2019. I hope that in 2020, Wealthdojo can continue to value add you. Let us know what you think in the comments below. This is a working article. The above doesn’t represent my stock recommendation in anyway. Please read our disclaimer for more information.
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