2020 has been quite a year, right?
What’s of primary focus now is the COVID-19 outbreak. On a global scale, financial markets are crashing and prior to that, oil price wars began (Russia, Saudi Arabia and the rest of OPEC). Countries, corporations and individuals have been adversely affected by these events. For events that seem so far away, how do they affect you?
Let me explain.
A system is said to be sum of interconnected parts and in one way or the other, we make up those parts. Interdependence is the bedrock of our existence. So, your pocket money has a source, yes? Could be from your parents, siblings, extended relations or that side project you decided to run based on our past conversations.
Your family members may work in corporates or have businesses. These entities have been affected due to the outbreak and the global expectation that individuals should stay home or work from home if they can. So how does income flow in when the buying and selling of goods and services have come to a near halt?
For those formally employed, there’s the fear of job loss when all of this is over. For those running businesses (informal employment) there’s a drastic drop in patronage and if they do sell essential items, a decline in patronage still exists thanks to customers who can no longer afford these purchases due to job loss or the general phobia of interacting with others due to the viral outbreak. In the USA, at least 2.5million individuals have filed for unemployment benefits as at March 2020.
If these individuals- family, friends and customers; are negatively impacted then your source of income is invariably impacted. Don’t fret. This won’t last forever and while we may not see the end in sight just yet, there are measures one can take right now:
• Boost up your savings! Especially your emergency fund – worth three to six months of essential expenses. No matter how little. This is not the time to spend on anything that is not essential. If it has nothing to do with food and shelter, pause. Notice that I didn’t mention “clothing“? You’ve been wearing clothes before, you don’t need more now. Right now, cash is king.
• The only investment I would recommend right now (because the stock markets will still plummet) is an investment in yourself. What’s that skill you can learn? (Indoors, of course) or that book you’ve always wanted to read? If you do have access to the internet on a regular basis, don’t just surf social media sites, sign up for free courses!
Keep holding on to cash (at bank & in hand) and good health this season! Stay safe.
