Regaining control of your finances in an uncontrollable environment

Covid-19 has hit the global economy on an unprecedented scale. Everyone from multi-billion dollar corporations to your neighbourhood nasi lemak aunty has seen their finances take a hit. Some of us have seen our incomes reduced or have even lost our jobs.

According to a survey conducted by the Department of Statistics Malaysia, most Malaysians do not have adequate savings (more than four months) for pandemic. No one expected this, so it’s not surprising that most of us are unprepared.

Pinch zoom to view the image

We’re creatures of habit and the MCO has forced us to change our lifestyles in the most drastic manner. We can no longer step out of our homes for a cup of coffee, and we’re learning how to be better cooks at home because that’s where we are, 24 hours a day. We’ve even learned how to carry out minor home repair and maintenance works on our own.

Our financial planning must take on a more sustainable approach. Exercising discipline has become second nature to us during this time, and we can actually take this a step further to help us plan our finances.

Get financially prepared for The New Normal.

Regaining control of your cash flow

The ongoing health crisis has had a huge impact on unemployment levels. As at February 2021, the unemployment rate stood at 777,500 persons (4.8%), a year-on-year increase of 1.5% from 3.3% in February 2020. The second full lockdown will likely have an impact on unemployment rate, although the extent is yet unknown.

It’s unfortunate, but if you find yourself among those affected, read on for some tips on how to manage your finances and get you back on your feet.

1 /
Spread out your commitments over a few instalments

If you have a credit card(s) and need urgent cash, check how much leeway you have with your facilities. You can spread out your commitments over few instalments with little to no interest/actual management fee. An option is to apply for CashXcess to convert your available credit limit into instant cash. Consider the option and take it up if the payments are manageable and you want to free up your cash flow for now, and you have the means to repay it later. Do take note that the interest/actual management fee on overdue payments is very high, so you’ll need to be much more disciplined in making your payments.

2 /
Consider a Personal Financing facility

If you don’t have any available credit limit on your existing credit card, but still need urgent cash, you can consider a Personal Financing facility. Take note of the interest/profit rates offered and take up the financing plan that suits your needs and budget. You may consider requesting a top up if you have an existing personal financing facility.

3 /
Consolidate all your cards’ balances with Balance Transfer

Interest/actual management fee on credit cards can accumulate and it might look like you’ll never clear the debt. To better manage your payments, a Balance Transfer can consolidate all your cards’ balances onto just one card, with little to no interest/actual management fee. With a lower payment, all your focus will go to the payment of the principal amount instead of on interest/actual management fee. This will help you to pay off your debt faster.

4 /
Reassess your daily spending

Reassess your daily spending and make minor adjustments to your lifestyle. You can cook basic meals at home instead of ordering food. You aren’t travelling much right now, so you can take the savings from petrol, parking and toll expenditure and put this amount into your savings or investments.

5 /
Prioritise and cancel your monthly subscriptions

Monthly subscriptions can quietly take up a large chunk of your expenses. Prioritise and cancel what you don’t need to free up some cash.

6 /
Pick up a new skill

Pick up a new skill related to your current work. There are plenty of free online tutorials, reading materials and webinars.

7 /
Adapt your current work to the digital world

You can start offering your services and skills online and earn a little extra income. This will also help you build a network you can continue to use after the MCO is lifted.

8 /
Join a network of folks

Join a network of folks in a similar field to exchange tips, ideas and work opportunities. It will also come in handy after the MCO.

9 /
Continue with your MCO money-saving lifestyle

Continue with your MCO money-saving lifestyle changes as much as you can. Take note of special discounts and privileges that your credit or debit card can offer and use these when you want to make a purchase. Cash Back is exactly that – you get money for spending money, effectively subsidising your purchases.

10 /
Add your digitisation skills to your portfolio or resume

This will make you more appealing to employers who are looking to reduce their overheads. Now that you can offer your services from home, you’ll continue to save on transportation costs.

11 /
Invest in your retirement

If you’ve managed to save a bit during the MCO, invest this cash in your retirement, however small the amount. Your bank will be happy to help you decide which investment product suits your needs and risk appetite.

12 /
Turn a hobby into a money-making venture

If you’ve got the time, you can turn a hobby into a money-making venture. For example, if you like cooking, offer to teach a cooking class in your free time.

This is a hard time for everyone.

There are options such as personal financing and cash advances to help you get back on your feet. You can discuss refinancing your home or taking on an overdraft. However, only consider these options if they can provide you with the opportunity and time to improve your financial situation and will not inconvenience you in the future.

This is the time to minimise and prioritise. Adopt prudent spending habits, and you can also sell items you have not used in the last six months.

Talk to us about your needs for the best solution, today.
Previous Article
A blessing, a curse or both?