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Financial lessons from the pandemic

Pandu W. Soeprapto
Pandu W. Soeprapto

Banker, part-time teacher, and at-any-other-time writer

Jakarta  /  Tue, May 19, 2020  /  01:57 pm
Financial lessons from the pandemic

Tracking your expenses is the first step to better managing your budget. (Shutterstock/eamesBot)

The coronavirus pandemic has been going on for months and has claimed numerous lives globally. At the same time, efforts to stop the spread of the virus, such as lockdowns and social distancing, have caused an economic slowdown, leading to bankruptcy, pay cuts and even unfortunate job losses.

There is no doubt that all of us are facing tough and tight situations in which we still do not have sufficient knowledge to say for certain when all of this will end. Opinions regarding this are diverse and only time will tell what the definite answer is.

Having said that, what will happen after the pandemic concludes? Your guess is as good as mine. But, personally, it is hard for me to imagine that things will go back to how they were before the pandemic started.

Anyway, how we move forward is for leaders of countries and companies to figure out. Let’s focus on our own task at hand: to learn.

There are always one or two financial lessons that can be learned from any kind of situation, including the current situation we are all in.

It is once again cemented in our hearts that properly managing our money is an indispensable part of our lifestyle as it enables us to create a more stable financial future while still enjoying the things that we love dearly, and financially adapt to the current situation without much difficulty.

Money management is more than just about handling money; it is also related to taking control of our lifestyle or habits to achieve financial goals by maximizing existing finances.

Set achievable goals

Prior to starting your money management, establish concrete, achievable goals so you have a clear purpose.

The goals need to be concrete and achievable to nurture your motivation and confidence, so that you can conquer bigger goals in the future. This is not impossible, so set high goals right off the bat. But, I think, most people will find those kind of goals daunting rather than motivating.

Put everything into record

Next, record all your financial transactions, and I mean all of them.

Simultaneously, as everything is seemingly online/cashless right now, beware of charges that occur when topping up your e-wallet and deliveries. Individually, they might not amount to much, but with high frequency they can turn into considerable expenses.

There are many apps that can help record your income and expenses. No excuses.

Why do we need to know our financial transactions anyway? To know the blueprint of your behavior toward money. You will not be able to fix or improve something if you don’t know where the damage is.

Do a review

Then, review your activities and be honest with yourself in determining which activities are wasteful and which are essential.

Upon finishing, do the next right thing: plan to get rid of the wasteful expenses.

Set a budget

Afterward, set up an appropriate budget and stick to it.

Focus on your own goals

Last but not least, you are not in a competition with anyone else. Your goals are your own. Therefore, do not get discouraged or distracted by what other people say or do with their finances.

Having emergency funds is important and helpful, and proper money management supports us to do just that. Many undermine the importance of having these funds, mainly because the purpose is to shield us against something/an event that, well, may not happen. So, they think the money is better used for other purposes.

It is not that I don’t understand this sentiment because I had this very mindset in the past until an incident woke me up. Regardless, by now, we should already understand that everything can be turned upside down in an instant, or that financial security is temporary, or that there is nothing certain except uncertainty itself. That something that we think might not happen, could happen.

In the dawn of the pandemic, my family and I also experienced a spike in our expenses due to having to stock up on food and pricey health-related items. Thankfully, all of those expenses could be covered by our emergency funds, leaving funds meant for daily activities unscathed.

Furthermore, experts have been saying that the pandemic could stay for a long time, or they are still unable to imagine what the business landscape will be like post-pandemic. Thus, even now, we continue accumulating emergency funds. Having a dependable source of liquidity in facing the unknown won’t hurt. Cash is king.

I am aware I just stated the importance of having cash. Nonetheless, as we are witnessing prices of assets plummet, nowadays seem to be a good time to invest because the assets are selling at considerable discounts. If you still have enough financial muscle after fulfilling your daily needs and establishing emergency funds, then invest.

In my case, I have been more active in buying shares in the stock market since the pandemic started. I understand that it might take a while until the economy recovers to gain a profit from my investment. Be that as it may, I am not in a hurry. Or, maybe it is time to invest in ourselves and upgrade our skills in order to be prepared for the future?

Investment is personal and tailored to meet our risk profile and objectives. Do your own research about what influences the value of an asset, its quality and sustainability before putting a single penny in it. Never make an investment solely based on what other people tell you, and it is not advisable to invest in something you do not understand.

Nobody knows what the future holds. Near the end of 2019, I expected the economy in 2020 to be somewhat stagnant – a far cry from today’s circumstances. Even so, with appropriate money management we can have a cushion in the form of emergency funds and can be a step ahead due to having enough liquidity to invest.

The pandemic is not a strong enough reason for us to neglect our financial preparation for the future.

Godspeed to all of us. (kes)


Pandu W. Soeprapto is a graduate of the Bandung Institute of Technology (ITB) and Monash University in Melbourne, Australia. He is currently a corporate credit analyst, and is particularly passionate about teaching and writing. Find him on Instagram @pandu_wi_soe.


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If you want to help in the fight against COVID-19, we have compiled an up-to-date list of community initiatives designed to aid medical workers and low-income people in this article. Link: [UPDATED] Anti-COVID-19 initiatives: Helping Indonesia fight the outbreak

Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.