Do these words sound familiar: “Save up for a rainy day?” My grandfather used to encourage me always about this. Never have these words become more poignant than during the early months of 2020.
In the months that followed the 1983 race riots my Father’s livelihood was attacked and it took him 4 months to bring the business back to a serviceable and saleable state, then he died. We were not only faced with losing my Dad but also with loss of income.
This pandemic of Covid-19 reminded me of several similarities. Among them were the reduction in income as a family, shortage of food, fear and uncertainty of the future. This seems like the experience of many people and not just me!
So what helped me bounce back as before? Some of the characteristics and similarities in the financial habits practiced by me so long ago came to mind.
I came across this definition “Financial resilience has been defined as “the ability to cope financially when faced with a sudden fall in income or unavoidable rise in expenditure ‘’. https://www.ons.gov.uk/. This explained my current financial scenario due to a loss of income. So many things would have to change but one aspect was the change in mindset, the expectancy to be buoyant in spite of the circumstance.
It was a time to rethink the way I spent my cash in hand and savings. To be resilient is to stay pliable in the situation and you must have a plan. Therefore some simple but tough changes had to be made:
- I had to ensure I had a cash buffer if my income dwindled in the next few months, I had to come out strong. So I made some wise cuts on spending. Though it seemed mundane, instead of using the online ordering mechanisms to order cooked food at a higher cost, we decided to order the groceries and cook at home.
- To pool our resources as a family and buy only what was absolutely necessary.
- At this point everything luxurious and what defined our status and style was put aside. Instead, a thought was spared for those in difficulty and help was given to them.
- The mechanisms provided by the state to defer loan and interest payments were welcome. Therefore I was able to reschedule my loan repayment for a longer term at a lower interest. And made purchases of necessities using credit cards wherever possible, thus delaying repayment.
- Checked on the relatively quick assets I had such as shares which could be sold in the near future if deemed necessary.
- And if there was relatively no other opportunity coming my way, I decided to work with the skills I had to supplement my income.
Anyone of us can be resilient. And you might be even surprised that you have achieved a better quality of life now than what was before COVID-19.
Featured image credit: blogs.adb.org