How to Protect Your Financial Health in a Crisis
Whether it’s a natural disaster like a flood or fire, an unexpected job loss, a family illness or even a worldwide pandemic, crises can occur when we least expect them. And they can leave you feeling anxious and out of control, particularly when it comes to your finances, so it’s good to be as prepared as you can.
Although there is often nothing we can do to prevent a crisis or economic downfall from happening, here are some simple tips for protecting your financial health before and during a crisis.
Revise your budget
Now is a good time to revise your budget, or create one if you don’t already have one. During uncertain times, having a clear plan can help you feel more in control.
Setting a budget will also help you distinguish between your needs and your wants, and identify potential areas where you can save money. If you are setting up a budget for the first time, Moneysmart.gov.au is a great place to start!
Moneysmart is an initiative of the Australian Securities & Investments Commission (ASIC) and provides tools and information to help people when they need to make financial decisions.
Reduce your spending
When things are financially tough, it’s a good idea to try to cut back on your spending and look for opportunities to save money where you can. It pays to shop around on some of your regular expenses and bills such as phone plans and insurance and see if you can get a better deal.
You may be able to come up with other creative ways to save money too, such as having a clothes swap, joining up with the neighbours and buying food in bulk or getting rid of some of the subscriptions you are paying for but no longer using. The options are endless!
Set up an emergency fund
The more prepared you are for unforeseen events, the easier it will be to protect your financial health so it pays to plan ahead. If you haven’t already got one, it’s a good idea to set up an emergency fund where you can put savings aside for unexpected expenses that may arise during a crisis.
It can take a while to build this fund up, but it can give you peace of mind knowing you have some money set aside for an emergency.
Watch out for scammers
Unfortunately, scammers thrive in a crisis and can try to take advantage of you when you are at your most vulnerable. You are not always thinking clearly when you are stressed, so be very wary if someone contacts you about an investment or another financial opportunity that seems too good to be true!
Further information on how to spot scams and ways to help protect yourself from them are available on ASIC’s Moneysmart website.
Check out what financial help is available to you
When you are facing financial hardship, there are many charities, community services and government organisations that can assist you such as Centrelink who provide emergency payment to those who are eligible for income support. The Government may also provide additional financial relief in some situations such as JobSeeker and JobKeeper during COVID-19.
Talk to someone
Going through a crisis can be a very stressful time, but thankfully there is help available. If you are feeling overwhelmed and need some assistance with financial decisions, the National Debt Helpline offers free financial counselling to help you get your finances back on track. To access this service, you can call 1800 007 007.
Along with your financial health, it is important to take care of your physical and mental health as well. If you need emotional support or just someone to talk to, there are also several free counselling services available.
A crisis can hit us when we least expect it so it’s good to be prepared. Taking some of these practical steps can help you get back in control of your money!
Seek for a flexible financial alternative
If you do find yourself in a position where you need to take out personal loans, MONEYME is an online lender offering cash loans and instant loans for Australian customers. The online loans application process only takes a few minutes, and the approval process is super-fast too. Take advantage of low rates and flexible repayment options, and see how much you can borrow before you applying with our online loan calculator.
MONEYME also has a Freestyle low rate virtual credit card with interest-free terms and credit back offers. Contact us today to see how we can help you improve your financial health.