As Metropolitan’s Three Word Stories campaign draws to a close, consumers are given tips to help with their finances during the Covid-19 pandemic and beyond
Nobody could have predicted the turmoil the coronavirus pandemic would cause for the financial lives of most South Africans. Many people’s income has been significantly reduced, and thousands of others are facing the prospect of unemployment. As a result, the economy is contracting. The pandemic has forced all of us to consider critical questions about our financial security.
According to a DebtBusters report from the first quarter of 2020, South Africans were under severe financial strain even before the Covid-19 outbreak and are now increasingly cashing in their long -term investments for immediate survival. The pandemic is likely to continue to affect household finances for years to come. TransUnion recently reported that 79% of South Africans’ household income has been negatively impacted. Therefore, being mentally strong, having a plan, prioritising spending and using resources efficiently is imperative to the financial stability for many families.
Now in its final week, Metropolitan’s Three Word Story campaign seeks to build resilience among South Africans by sparking conversations about real-life financial concerns, and ease their anxiety about the future by finding ways to deal with the challenges they face.
“Access to money has a great impact on how people experience the pandemic. Our food security, personal safety, health and so many other essentials depend on access to money. The questions consumers are asking themselves about their finances have never been more significant. How do I ensure my financial survival? Should I be saving more aggressively? How do I restructure my finances or my debt? How do I pull myself out of debt? Our tips this week aim to help South Africans deal with tremendous financial challenges we are all facing and how to navigate through these unchartered waters,” says Llewellyn Allen, Head of Marketing: Metropolitan,
“My hope is that these tips will assist people find a way to not become overwhelmed, but to dig deep to find their strength. The only way to conquer fear is through action, and that starts with reminding ourselves that we have the mental strength and resilience to deal with whatever financial challenges we face,” adds Allen.
Reassess your finances and budget accordingly:
Many financial experts have predicted that the value of the rand is likely to fall. Consumers will be forced to spend more Rands to buy the usual items they bought before the pandemic. It is important to be realistic about where you stand financially.
Honest budgeting and keeping track of expenses serve as a great reality check. Be honest with yourself; the first step is to understand where and how you spend money. To do this properly, draw up a detailed, accurate account of everything your household spends money on in a normal month. Start by listing all fixed monthly expenses that help you maintain a basic standard of living. Then draw up a second list of variable expenses, including discretionary spending. Once you have both lists, compare them with your income and cut out any unnecessary items so that your expenses are less than your income. Even though removing luxuries from a monthly budget might be painful, the ‘new normal’ of social distancing and staying at home might make it easier to cut out the out of home luxuries. Plus, it will reduce stress if you manage to reduce your expenses to be less than your income.
Involve the whole family:
This is an opportune time for parents to talk to their children about where money comes from, why budgeting is so important, and how everyone in the family can contribute to lowering household spending by making compromises. Parents may want to consider reducing their children’s allowances now that most children are at home and not able to spend money on excursions. Set savings targets for the whole family and make it fun and practical. Seeing money accumulate in a glass jar in the kitchen and later depositing it into a bank account for safety can be highly motivating, and it can be the start of learning about investments and earning interest. Depositing the money in a bank account, not only keeps the money safe but also helps with fighting the temptation of spending the money when in sight.
Make smart financial decisions:
A crisis such as the Covid-19 presents new opportunities for scammers and fraudsters to steal money by preying on people’s anxieties. Now is the time to make considered financial decisions and avoid the temptation of investing in and losing your money to get-rich-quick schemes. Speak to an accredited financial adviser if you need help with making smart financial decisions during this time.
If the household’s financial standing has changed during this difficult time, calm nerves are required to take stock of the finances and make adjustments if required. Information from credible sources as well as speaking to an accredited financial advisor can help to make sense of things.
targeted toward Parents.
We understand that there are many aspects that encompass a Mother, Father or Child and strive toward providing resources and services that accommodates
this.
Our content is aimed to inform and educate families on issues starting from
pregnancy through to the challenges of the teen-age years.
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