on Jul 29, 2021
The COVID-19 pandemic has undoubtedly sent waves of shock to the global economic system by rattling the core businesses of many industries, and also by eliminating the jobs of many individuals.The pandemic has had a direct negative impact on many important sectors of the global economy, leaving many individuals unemployed. However, on a brighter note, it should be seen that difficult times often bring about greater wisdom along with valuable lessons, from which we could learn to make better decisions in the future and work towards self-improvement. In this article, I shall discuss the 4 financial lessons the pandemic has taught me.
1. Debt can either be your best friend or your greatest enemy
It is inevitable to take on debt at least a few times in our lives. Improper debt management, just like opium to a drug addict, radically spirals uncontrollably leaving ruins that usually take a long time to recover. The first step to managing debt in our lives is to understand the importance and impact of interest rates on the global monetary structure and how we should plan on allocating our salaries wisely by accounting for what we owe when, in order to significantly lower the amount of money paid to interests in the long run. Also, it is important to understand how personal borrowing from banks or even licensed money lenders may provide us with instant cash loans in Singapore through a personal loan which may then be used to ease the payments for large ticket purchases that we may incur. As such, by spacing out the due dates, and splitting payments into lower monthly installments, we can increase our existing cash flow, enabling us access to greater personal cash flow.
2. Understanding the difference between ‘cheap' and 'expensive’ money gives us a better perspective on valuing the cost of borrowing, saving and spending
Interest rates are usually the bedrock of most economies’ success in maintaining a good amount of savings and spending keeping inflation in check. It is important to always know when is a good time to spend and when we should adopt a more thrifty approach. When interest rates are generally low, it is usually a good time to spend since there is little incentive to keep our money in a bank. This approach can be applied when we look towards purchasing expensive items such as a car or house where we have a huge sum of loan to pay over several years. Vice versa, in an economic climate with high interest rates, it would be more favourable to save to achieve greater returns on the money placed in a financial institution. Also, it is important to always consider other forms of instant cash loans in Singapore such as through licensed money lenders to properly evaluate the best and cheapest personal loan in singapore.
3. The only certainty about the global economy is its uncertainty
We have seen how the pandemic has put an end to and adversely impacted a range of industries such as the airline industry and even many other brick and mortar companies. With such economic uncertainty looming, it is necessary for us to have a sufficient amount of emergency savings kept aside from our monthly salary. Also, it is a good practice to constantly revisit our existing loans to seek better alternatives in terms of refinancing our debt obligations to lower the amounts of interest incurred on our financial liabilities. In addition, proper diversification may also cushion our overall losses and we need to constantly update ourselves with the right type of economic information to be better prepared for any type of restructuring. Also, being well-informed will enable us to do comparisons and even on a personal level, if we decide on applying for a personal loan for any reason, it is a good habit to seek the cheapest personal loan in Singapore which eventually may save us huge sums of interest when calculated over a given number of years.
4. We were made to adapt and accept change better than we think
Many of us reading this article lived through the years where there were no mobile phones, and had very little or even no means of obtaining information from the internet. However, with the rise of digitalisation and technology, we now have the world’s information available to us with just the click of a button. From an organisational standpoint or even on a personal level, it is important to embrace changes and to always be versatile in moulding ourselves to blend into the wider global economic structure. From e-commerce to online lending, we have seen how businesses have shifted their models taking into account the wide marketplace that could exist online, hence reaching out to a larger target audience online. We can also use the web to search for almost anything. A good start would be to look through our existing financial obligations, and to then search for the cheapest personal loan in Singapore to restructure our finances. With that, we can properly plan and lower the amount of debt we have, and also increase our credit score which is always a good choice to get access to greater funds in the future, if necessary.
In conclusion, the pandemic has definitely caused infinite amounts of economic destruction, however if we are ever faced with a similar situation in the future, it’s always good to practice the cautions we learnt from this experience to better manage our lives and finances.