Financial awareness should hold family members in times of emergency
We are nearing end of April, 2020 and India is under complete nationwide lock-down due to coronavirus pandemic. As per experts, social distancing is the only way to arrest the cycle of infection. The Govt. of India has strictly told all citizens to stay at home and work from home. Self-isolation is really a problem as we usually have never ever experienced such incidence. The slogan is, “Stay home, stay safe and stay healthy”. We believe that if each one of us does our bits by staying at our homes, we can stay safe and healthy. Crisis or any emergency situations teach us life lessons. During any unique crisis or emergency, we may not keep calm. Unfounded, we may not respond, but react emotionally. When it comes to financial aspects during any such unique crisis or emergency, financial awareness among all potential family members must prevail to weather the storm. Family members must be aware of family financial matters – When to do what. Unbiased and professional guidance of a Financial Advisor in Kolkata may enable you to compose yourself and stay organized financially. Accordingly, you respond to your unaddressed concerns, since personal finance is a complex topic.
Financial awareness among family members in challenging times is a fundamental requirement
It is obvious that during this transitional stage, we may be troubled by negative thoughts. In normal situation, most of us are busy since we are engaged in our own profession/ service/ business etc. We hardly get to spend quality time with our family members. Why not look forward to these days with a constructive mindset? Why not help each other in household works and develop a sense of closeness within our family? Also, we can look to analyze our family finances at this stage.
Due to certain constraints, you might have missed out/failed to share various aspects of your family finances with your spouse/potential family members. After finishing your household works, you can utilize this window of time to sit with your spouse/potential family members and discuss various aspects about your family finances and increase their financial awareness. It’s the perfect time to revisit your Financial Plan. You can tally your monthly cash flows (income & expenses) with your budget. You can track your progress towards your financial commitments – Where you are now and how far you need to go to achieve your financial commitments. So better to utilize your quality time with your potential members and share in details. In case of any assistance, you may consult with Certified Financial Planner in Kolkata.
Personal finance may not be an interesting topic for a few. It’s a rarely discussed topic, but no one can ignore its importance. We must never avoid our limitations. We must face them and if required, take professional guidance to overcome our reluctance in the subject matter.
Strong foundation of personal finance helps you to live through tough times
As Financial Advisor in Kolkata, we invariably urge our clients to engage spouse/potential family members during all the financial planning processes to ensure financial awareness among family members. “Contingency and Insurance Planning” is the foundation of personal finance. It is at this juncture, every one of us is realizing the importance of having a Contingency Fund in place. During financial planning, it is a practice to give paramount importance to “Contingency Planning” and “Insurance Planning” before anything else. As stated earlier that it’s one of the foundations of your personal finance, everything will fall apart if requisite amount of Contingency Fund and adequate Insurance coverage are not kept for your family. In case of untimely death of breadwinner, there will be a havoc financial loss and insurance can somehow mitigate the financial losses. On the other hand, if our income completely or partially stops due to economic slowdown/crisis, our Contingency Fund can meet the monthly expenses. It may happen that your aging parents require financial help in case of medical emergencies. Also, your newly married son/daughter may require financial help during any crisis or emergency. They may or may not be financially sound at the start of their careers. Therefore, your “Insurance & Contingency Planning” are subjective, it is better not to follow any rule of thumb. From another perspective, if you are noticing the lower valuations in the equity market (due to any event) and considering taking advantage of the situations by utilizing part of your Contingency Fund for your long term goals, you are digging your own grave. However, investable surplus may be utilized at this phase towards your long term goals only.
Financial awareness among potential family members should prevail at all times. There’s no alternative.
In absence of key-person of the family, basic financial awareness can help you to run the show
If the key-person (decision maker of the family and the one who keeps all family financial information and documents) is admitted in hospital due to illness, who is going to take charge of the family finances? Reality is that, the key-person will not be in a position to give any instruction during his/her illness. Potential family members (parents, spouse, and major children) may have to take major/minor financial decisions during any emergency as the particular key man or bread earner may not be in a position to take any decisions due to the adverse situation. God forbid, if the key-person stays at hospital for long time for treatment or if the key-person doesn’t come back again? We do not want to instill fear among you all. Through our experiences while dealing with our individual and family clients, we are intending to make you realize the harsh realities. As responsible Financial Advisors, we urge every potential family member to be aware of all their family financial information and documents. financial awareness is extremely crucial during challenging times like these. This would enable us to act prudently in case of any need. It is basic to be aware of contact details of family doctor, Chartered Accountant, Lawyer Financial Planner, etc. and location of important personal as well as financial documents. It will give peace of mind once you are aware of personal as well as financial aspects of your family.
It is not the time to panic, but to take decisions rationally. We panic when we do not have solutions/ way outs in front of us to get rid of the crisis. These bitter experiences will allow us to introspect and take rational steps during traumatic stages of life. Awareness (be it financial awareness or general awareness) helps us to act prudently.
Team Merry Mind is sending prayers your way, believing that we’ll make through the transitional stage and come back to normal life.
