The global pandemic and the slowing down of the economy have caused many of us to dip into our emergency, investments, savings and retirement funds. But that’s okay – there are ways for your to rebuild your savings once this uncertainty is over. As you focus on the safety of your family, let us help you rebuild your funds.
Here are some tips to soften the blow of this financial setback, so you can get back on your feet as soon as possible.
Rework your budget
If you have never created a monthly budget before, now is a great time to start. To easiest way to begin is by listing down your current income, fixed expenses (like rent, debts, bills and insurance) and flexible expenses (like groceries). It’s easier to work out your income and expenses by using a budget calculator.
Why create a budget, you ask? This is the best way to ensure that you can stretch that income until the next cycle – and looking at your spending can help you decide what you can cut down to increase your savings.
Identify where you can cut spending
Could you cut down on groceries by creating a weekly meal plan and switching to cheaper or generic brands? Is there a way to refinance your debts after the moratorium is over to reduce your fixed expenses? If you’re eligible for financial relief, apply for it as soon as you can.
If you need to buy big-ticket items, try to get them when there are deals. Add these items to the wishlist so you can check prices often, or use a price tracker that will inform you when things you want go on sale.
Many of us have saved money by not eating out. For those who have improved their cooking abilities, don’t let those skills fade away! Once this is over, you can continue saving money by packing food to work. But while you’re at home, you can up your kitchen game with Urban Stove who create recipes and deliver the necessary fresh ingredients for you to prepare yourself.
Make a financial plan
After you’ve set up your budget, you need to make a plan to rebuild your finances. Identify your high-interest debts, such as a credit card balance, and set a deadline to pay it off. Once your debts are under control, you can begin investing for your future. If you’re not sure how to start, you can talk to a financial planner, and also check out our customised financial solutions from CIMB F.I.R.S.T.
Start saving as soon as possible
One of your first priorities must be to rebuild your emergency fund once you’re more stable. This gives you a safety net to fall back on, and will help protect you from other financial upsets in the future. Find out more about building an emergency fund here.
One flexible way to save with higher interest is to use our Unfixed Deposit. Unlike regular fixed deposits, you can make withdrawals before the maturity date without losing the interest on your remaining balance.
Explore ways to close any financial gaps
Aside from cutting down on expenses, you can also find ways to earn extra income. These can be through a side hustle like renting out a spare room on AirBnB or organising a food court.
There are no quick, easy fixes to rebuild your finances. The key is to have patience and to stay motivated. With time and good financial management, we will get through this.
This article is brought to you by CIMB as part of our ongoing efforts to raise the level of financial literacy among Malaysians. Financial knowledge and understanding are key to making well-informed and meaningful financial decisions that will improve all our well-being. This, in turn, achieves CIMB’s purpose of advancing customers and society.