In case you had to cancel your trip in the wake of the COVID-19 pandemic, here are ways you can judiciously use your travel fund.
The WHO has now declared COVID-19 a global health emergency and is sharing daily updates on how we can tackle this rapidly-spreading disease better. Governments have followed suit by putting out travel advisories, restricting their citizens from overseas travel. Companies across the world have taken a cue and introduced a slew of precautionary measures to keep their employees safe and healthy like asking them to work-from-home for some weeks; freezing overseas travel; and regular fumigation and sanitisation of the workplace. COVID-19 has affected a lot of countries – many of which are popular tourist destinations like Italy, Japan, South Korea etc.
Amidst all this, it is only natural that you’ve kept your plans of travelling abroad on hold. A cancelled overseas trip could mean at least a few thousand rupees more in your bank account. So how can you make judicious use of this travel fund? Let’s take a look at a few ideas:
Pay Off Outstanding Bills:
The first order of business should be to clear whatever outstanding bills you have. While paying some of these bills could be a monthly, routine affair, there are some you shouldn’t leave outstanding no matter what.
Credit Card bills: Credit Card interest rates are incredibly high. Outstanding Credit Card bills can often snowball into a huge burden of debt that may take you years to pay off. If you have a tendency to forget due dates, you could even set up automatic payments.
Insurance premiums: Review your insurance cover and check if it’s enough for you and your family. You could even use these extra thousand rupees to increase the coverage for you and your family.
High-interest loans: You can even use the additional money to pay off high-interest loans, if you have any. One thing to bear in mind here is that an early repayment can incur additional charges. In such cases, work out a comparison between those additional charges and the interest you have to continue paying for the entire tenure of the loan.
Additional Reading: How Does Coronavirus Impact Your Insurance?
Beef up your emergency fund:
Do you have enough saved that will cover you and your family for at least 6-9 months in case you lose your job? In fact, do you even have an emergency fund at all?
If your answer is no to both these questions, then this is the perfect opportunity for you to set aside this money for your emergency fund. This emergency fund will help you and your family tide over difficult times if you suddenly lose your job. Getting a new job may take you weeks or even months. Having an emergency fund will help you pay your bills and maintain the same lifestyle as you did before.
If you’ve put off investing all this time, you can also make your debut in investing with this money. There are a whole lot of companies that will recommend the right kind of portfolio basis your profile and financial goals. The sooner you start, the better. It’s not just about timing the market but also your time in the market.
Additional Reading: Budget 2020: 5 Personal Finance Changes You Should Know About
Invest in yourself:
Times, they are a changin’. With AI changing the game and putting a lot of people’s jobs at risk, it’s crucial that you keep your skills relevant despite the changing demands of the economy. Amidst the global economic slump and restrictions on travel, now is a good time to pick up a new skill. There are a whole lot of companies that offer in-demand courses like digital marketing, AI and machine learning etc. online.
Invest in your health:
In times as uncertain as these, it’s of utmost importance that you invest in your health. Use up the extra money to either top-up your insurance, enroll yourself in the gym, for yoga classes or any fitness class that will help you get on the road to fitness.
In the wake of COVID-19, if you’re planning to give crowded places like gyms a miss, you can even give those fitness apps a try and work out in the comfort of your home.
Additional Reading: How The Kakeibo Way Of Budgeting Can Help You Save More
Splurge on yourself:
While it is important to use this money judiciously, you can still use it to splurge on yourself if you have taken care of the essentials. Get yourself that instant coffee maker that you always wanted or that Ottoman that you’ve been eyeing for some time at the IKEA store. Remember to follow a disciplined approach towards your spending.
With COVID-19 showing no signs of receding, overseas travel is likely going to be marked unsafe for a while. Till then, make the most of your time to review and plan your finances accordingly.
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