Personal Finance must-haves during crisis like Coronavirus
Coronavirus have not just infected people but also wiped out a lot of wealth. This happened amid Coronavirus (COVID-19) fear that made many businesses shut down their operations for some time. It is spreading so quickly that World Health Organisation (WHO) declared it as a pandemic. Although, its mortality rate is low than previous other outbreaks, epidemics and pandemics. But the rate at which it is getting infected is high and as per few reports; it affects mostly the younger and much older population due to low immune. Having said that, here are a few things you should have during such crises.
Emergency fund
Not just due to the presence of this epidemic but in normal times as well, financial planners do recommend having an emergency fund in place. This prevents you from anxiety during such desperate times. Having at least 12 months of expenses as emergency fund would help you to fulfill your immediate cash needs. Therefore, having emergency fund in place is of utmost importance.
Insurances
This is another thing that every individual must assess and have it in place. In such a situation, there are chances of any uncertain event taking place. Therefore, to protect the future of your dependents financially, it is always wise to have a life insurance (term life insurance plan) in place. Also, you should have health insurance. Now that Insurance Regulatory and Development Authority of India (IRDAI) have notified insurance companies to include COVID-19 and pass claims accordingly. Therefore, having insurances is beneficial for not just you but also your family.
Follow your financial plan
This is the ideal situation for activating the behavioural biases of investors wherein, they sell in panic and book losses and then say that equity investments are not for them. Investing in equity requires a lot of patience and investor’s ability and willingness to take risk. Without risk, you cannot expect desired returns. Therefore, rather than panicking and selling your investments, revisit your financial planner to understand what you need to do.