Don’t use credit cards like this!

The COVID-19 outbreak reiterates the significance of financial planning and savings. The pandemic-induced health and economic crisis took a toll on many, but the work from home (WFH) culture came as a blessing in disguise. Not only we got a chance to spend time with our families, we also got an opportunity to become financially prudent. As we cut down on discretionary expenses, we realized how much money we can save. Besides, essential expenses – from the cost of commuting to obligatory social get-together- also came down to almost zero.

So, if you have managed to save during WFH, here’s how you can utilize your savings optimally:

Meeting need-based expenses
For Amit Sharma, 28, the pandemic has been a big advantage as now his savings are doubled and he can think of shifting from two-wheelers to four-wheelers soon. Sharma works for an IT firm located in Gurugram, Haryana. As most of the IT companies have shifted to Work from Home since past one year and are still continuing this work culture amid the rising cases, people moved back to their hometowns.

Sharma said, “Living in Tier 1 city is very expensive. Along with the rent, conveyance and wear and tear charges used to make me broke at the end of every month. As soon as my company offered work from home, I shifted back to my hometown. Now I am able to save a major chunk of my salary. With this, I am planning to buy a car soon.”

Building an emergency corpus and paying off debts
Raghav Yadav, 32, says that earlier he would have no savings left at the end of the month which often led to more and more debts from friends. The cycle continued for Yadav until he started working from home.

“Now I am able to save a lot which I am using to build my emergency corpus and repaying debts. The pandemic made me realise that having an emergency fund is important as there are a lot of uncertainties and one must not depend on debts,” Yadav said.

Make your money grow by investing

Ragini Srivastava, 30, works as a digital marketing officer for a Pune-based company. For Srivastava, the work from home culture has made her invest in mutual funds like SIPs.

Srivastava said, “With so much savings, I have started investing money in mutual funds. It is a part of my retirement plan now. And it is always a pleasure to see your money grow.”

With vaccination drive picking up pace, the offices may soon get back to normal, which means your expenses could rise again. Therefore, before committing to the long-term investments, it is better to be mindful of your future liabilities as well.