The entire country is under complete lockdown for 21 days. The lockdown aims to stop the spread of coronavirus. While it may be frustrating to stay indoors for 21 days, there are several things that you can do in this period. One of the areas of your life that you can reinvent these days is the financial aspect.
Here are a few things that you can do during this time to take care of your financial life:
Do you have multiple savings accounts that you rarely use? It is time to consolidate your savings account. Many savings accounts carry a minimum monthly average balance. A penalty is put if you are not able to maintain the minimum average balance. Check if you need to maintain a minimum average balance or open a zero balance account like Kotak 811 instead. Kotak Savings Account also offers high interest rate of up to 6% to its customers.
So, if you rarely use some of the bank accounts, you can look at closing some of the accounts. You may have to visit the bank branch to close your savings account. If you have money in these accounts, you can transfer the amount online through IMPS, NEFT or UPI to your regular savings account.
With all your family members present in the house, it is a good time to discuss your financial goals and plan for it. You can make a list of all the financial goals such as children’s higher education, buying a house etc. Prioritise your financial goals so that you can achieve your financial goals easily.
You can also call your financial advisor who may be able to help you plan better for your financial goals.
Most of us know how much we earn. But, not everyone knows how much they spend. Keeping a track of the expenses is an easy way to know where our money is going. Some types of expenses include fixed expenses, personal expenses etc. Examples of fixed expenses can include rent, electricity bill, phone bill etc, and fine dining and luxury shopping can fall under personal expenses.
You can also use a spending tracker app like ETMoney, Walnut etc to track your non cash expenses. These apps automatically segregates your online purchases into different buckets such as education, food, gifts etc. For cash transactions, you need to fill up the expenses incurred manually.
Having an emergency fund can help us to tide over emergencies such as a job loss, or a health emergency. If you don’t have an emergency fund, it is time to start building an emergency fund. Typically, you need to have at least three or six months of expenses in an emergency fund. As you have calculated your monthly expenses, it will be easier for you to come up with the amount that you need to park in an emergency fund.
It is important to keep your documents updated. Whether it is the name of the nominee or your contact details, it is necessary to have updated details. It is seen that many individuals don’t update their nominee details after marriage. Check your and your spouse’s bank nominee, nominee in insurance policy, mutual funds, investment account etc. You can also update your nominee details online by logging in on the company’s website through your log-in details.
It is important to have a nominee in your bank account so that the bank nominee/family members can easily receive funds after any unfortunate event.
During this 21-day lockdown, it is easy to get bored. However, it gives you time to do a lot of other things that you never got the time to do. As the entire family is together, this is the best time to sort out your financial life and plan for your financial goals.
