ALGOA FM: 5 financial mistakes consumers should not do during this pandemic

As we are in Lockdown to reduce the spread of COVID-19, We should avoid unnecessary financial mistakes in these difficult times.

“Consumers should do everything in their control to keep their financial affairs in order through this difficult time and the uncertainty it brings. One cannot predict how long it will take for the situation to stabilise and the knock-on effect on the economy. The idea is to adopt a disciplined way in managing your money and seek financial relief where necessary and possible.”  Said Dhashni Naidoo, FNB Consumer Education Programme Manager.

5 financial mistakes you should avoid during this pandemic according to Naidoo:

Do not cancel your insurance – Ask or contact your insurance provider to see if they can reduce your monthly premiums instead of not paying or cancelling your insurance policy. Cancelling your insurance or leaving it to lapse puts your family and yourself at higher risk. It may not work in your favour when you want to take out an insurance provider again and it may result in you paying a higher premium than the one you were paying before or maybe you get excluded from certain insurance benefits.

Don’t take up unnecessary debt – Reduce your expenditure where possible, avoid credit of non-essential things because the debit remains even after the lockdown period and you are liable to pay it.

Don’t make any big financial decisions – We do not know how long this pandemic will last and it wouldn’t be wise to make big financial decisions. Save where ever you can, spend with caution and be realistic of what circumstances we live in. If you need to take a big financial decision than you have make sure that this will sustain any changes to your income.

Seek financial advice from a financial advisor – Don’t rely on your friends and family for financial advice. Consumers are urged to rather approach their bank, insurance provider, credit provider or financial advisors to get proper financial guidance in relation to their financial matters as well as to be helped in navigating and managing their financial affairs effectively.

Don’t spend money unnecessarily – Save where ever you can, use your reward programmes for relief and cut back on luxuries.

“It’s important to exercise caution in your financial decision making, be conservative in planning for the future and extra careful in how you spend. Furthermore, if your finances have been affected by COVID-19, consider the measures that your bank may have in place, including your credit life insurance that may cover some of your debts on qualifying claims,” concludes Naidoo.