Create a budget

Concentrated focused Afro American female freelancer holding phone in one hand and making notes with pen in other while planning budget.
WAYHOME studio / Shutterstock

You need budgets even when things are going great, let alone when there is some uncertainty that threatens to hamper your financial situation. During periods like these, creating and sticking to a budget is absolutely necessary if you must manage your personal finances.

List all your spending areas like groceries, utilities and the like, as well as their cost implications. Compare the total you need to spend for a period with how much you have as reserves in the bank. This will give you an idea of how much your reserve lasts in the case that you are not able to make any extra money for some time.

You can decide to strike out some options to prolong the availability of your reserved cash. Even if you feel the hardship situations will not affect your regular income, you still don’t need to spend frivolously. You can commit most of the remaining to savings.

Refinance or consolidate your loans

Pink eraser erasing multiple debts written in money font.
Mega Pixel / Shutterstock

During any financial crisis, everyone finds it difficult. Too much worry is in itself harmful to your mental well-being. If you discover that you always get worried during these periods, you may need to take care of your mental health immediately.

You can engage in relaxing activities such as biking or gardening. You can do some indoor gardening with indoor grow tents. These have proved to provide the medicine to heal your psyche. Indoor plants help us to clean the air we breathe.

Some financial institutions, in a bid to be relevant at such trying times, tend to lower their borrowing rates. If you did have a loan before these trying times, it will be very wise to refinance that loan so that you can have a lower rate and possibly access more funds with cash-out refinancing.

This will make life much easier for you and in turn reduce your worries.

Go for cheaper alternatives

young happy family married couple dreams of renovating  house and planning a design project
Evgeny Atamanenko / Shutterstock

One of the mistakes people make is not allowing reality to affect the way they live their financial lives.

During a crisis situation that makes sure to affect your financial strength negatively, one of the measures you should take to ensure you don't go poor in a matter of months is going for cheaper alternatives to what you usually purchase.

This will help you manage your personal finances during this time.

For example, if you were thinking of buying a new home and you encounter some uncertainties that suggest that you will need to be more careful with your spending, change your plans.

Instead of buying a new house, you can keep the budget low by remodeling. your house.

Conserve cash

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iordani / Shutterstock

You have to realize during any global economic crisis that everyone will be affected financially. The weight of the effect will differ from individual to individual.

The first and most important rule to abide by in uncertain times is to conserve as much cash as you can.

I am sure the coronavirus pandemic and the resulting lockdown situation taught us a lot of lessons. You have to minimize your spending as much as possible so you can have more money saved in the bank.

It looks like it goes without saying but most people panic and rush to pay a lot of bills during this period so they can be sure that they are covered for some time.

The idea is this; before you spend any cash, you need to ask yourself if it is absolutely necessary. You want to be sure that you have enough to cater to your necessities during a period of uncertainties.

Negotiate bills

Pile of envelopes with overdue utility bills isolated on white
Billion Photos / Shutterstock

Desperate times call for desperate measures.

You should assume that everything is negotiable well until proven otherwise. Many companies offer hardship discounts for clients who find themselves in a financially difficult situation.

Though this process could take time, you need to understand that you are the one needing a favor here and so you need to be patient. Never leave the stone of negotiation unturned.

The worst-case scenario is that the company turns your request down but at least you get to know you have tried that option. You can revisit your budget and restrategize.

Most people start trying to manage their finances when they have already been dealt cruel blows by a hardship situation. While that is still some late wisdom, it was still okay to at least start before things become irreparable.

Discipline is the most important personal attribute here. It is not easy to save or stick to a budget even when everything is going well.

You can find some of these tips helpful if you find yourself in times of uncertainty.

About the Author

Monica Gibson

Monica Gibson

Guest Contributor

Monica Gibson, of *Vents* magazine, is a business-savvy decoration expert who holds a degree in architecture and has more than eight years of experience in interior and exterior design.

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