COVID-19 has not only halted the usual flow of our lives, but it has caused the economy to crash deep into the earth’s core. If Construction sales and negotiation teach us anything, it is that during these dark times, it is essential that you learn the art of financial management by yourself, and prepare yourself for the upcoming crisis. Moreover, growing your construction business also requires an advanced understanding of financial management.
Today, we will discuss an informative list of steps that you can take to ensure that you do not run into any unforeseen financial obstacles during the pandemic lock down. Let’s take a look.
Revisit Your Essential Spending
Do you want to survive the COVID-19 pandemic? Well, stay true to social distancing, and revisit your essential spending. For the time being, you need to press pause on your leisure, pleasures, and extravagancy. It is time to exercise the rules of essential spending.
What do you need that is essential to your survival? Food, rent, groceries, and other day-to-day use items. Make sure that you do not spend any money on things that you do not need and are not essential. Save up for the essential items, since the pandemic can go on for months before it finally comes to an end.
Start with Your Income and Assets
So, the unforeseen pandemic is here, and the world is turning into a futuristic dystopian landform sci-fi movies. Instead of worrying about barricading yourself inside your house, you need to start making a list of your expenditures, and assessing your income and assets.
Once you have a clear idea of where you are, you will know where to go. Jot down everything you own. Make a list of your upcoming income and take a look at your assets. You need to know what you have lying around so that you can organize your financial status to play to your benefit.
Build Your Emergency Savings
Now that you know what you have and where you are in terms of financial status, you will be better equipped to build your emergency savings. Well, now is the time to do that. If construction sales and negotiation teach us anything, it is that emergency savings always come in handy.
How do you build emergency savings? You take into account your spending, your essentials, your current resources, and your necessary expenditures. Then, you pool in everything that you have lying around and make sure that it is higher than the required amount.
If you have lesser money than your expenditures, you need to unfreeze your assets, withdraw your cash, and pool everything in to build emergency savings for yourself.
Categorize Your Budget Expenses
Now, it is time for the categorization of your budget expenses. This means that you need to sit down and categorize your expenses into different sets, such as traveling, eating, reading, necessities, finances, groceries, etc.
Once you have categorized everything into different sets, the next step is to set up a priority next to each category in terms of necessity. This means that everything with high priority gets a higher budget than the category down below it. This will allow you to understand what you need the most, and how should you spend your money on it.
Moreover, once you have your emergency savings, you need to set aside a monthly budget for the next 4 months (quarter). This way, you will know how much money you can spend in the next month, and how that should be divided into different categories. You will not be caught off-guard with low cash flow.
Monitor Your Credit Score
This a pandemic can easily take down your credit score, and you may lose your credibility as a creditor. So, you need to understand how to monitor your credit score even in dark times.
So, if you can, you should keep paying your credit installments regularly, and make sure that your credit score remains high. This will ensure that when you come out of the pandemic, you will not have to struggle against low credit score and worry then. Precaution is better than the cure, so start taking care of everything right now.
However, we must mention that credit score goes in a category below food, rent, and other necessities. After spending on the necessities and essentials every month, you need to see how much you can spare for keeping your credit score on a normal level.
Make Wise Choices
Well, this is true for any situation, pandemic, r no pandemic. Making wise choices will always keep your health in terms of financial, and will keep your pocket away from any unnecessary draining.
The art of construction sales and negotiation teaches us that making wise financial choices will always keep us away from any unnecessary trouble. Making wise choices in the time of crisis means having to cut down on your irrelevant items and guilt-pleasures. Spend only what you have to, and keep everything else saved for a rainy day, which almost feels like every other day in this pandemic.
Don’t let the cash be wasted. Keep the cash on you, and use it with great caution. Do not deny the possibility of a job loss, or a brief furlough. Keep the costs to a minimum, as if it were an emergency. This is why you need to make wise choices to sustain yourself for as long as possible.
Eliminate or Reduce Nice-To-Haves
It is nice to have nice-to-haves, but it is not nice to have nice-to-haves when the pandemic has shut everything down, and reduced us to frightening human beings trapped in our homes. Well, this means that you have to either cut down on your unnecessary spending or eliminate it. This means buying stuff that you do not need, such as new clothes, video games, junk food, online subscriptions, and other irrelevant factors.
The Bottom Line
Yes, the pandemic will not last forever. However, as long as it lasts, we need to be careful with our expenditures and our financial situations. This means an exclusive categorization of your budget vs expenses, reallocation of available resources to essentials, and making wise choices.
You can still get construction leads from online software systems, but you have to limit your spending to things that you need to survive the pandemic. Conserve your resources, use your cash for survival, don’t burn through your cash in the first few weeks, and stay protected inside your house.
We will make it through this pandemic, but we have to be wise about it, and we have to be ready to accept any crisis that arises as to the product of the COVID-19 pandemic. That includes the financial crisis as well.