Social Distancing is the best prevention for the Coronavirus
We are amid the Coronavirus pandemic. This pandemic is creating a lot of economic and emotional distress. People are dying and those not dying are dealing with a harsh economic reality.
To reduce the spread of the virus, people are being asked to practice some social distancing and to wash their hands frequently.
As for washing the hands, people are panic buying at the stores. Hand sanitizer and disinfectants are flying off the shelves.
As for social distancing, it’s recommended that people stay away at about six feet or one meter away from each other.
The economy is taking a hit
Of course, social distancing is wreaking havoc in the economy. Airplane and cruise ship traveling has been canceled. Bars and restaurants are empty. Sporting, musical, and business events are being canceled as well. Practically every economic activity where there is social interaction is being affected.
For many people with stable jobs and benefits like sick-leave, nothing has changed financially. But there are many people or business owners who don’t have that luxury. Many self-employed people and part-time employees are losing their income and have no recourse.
The importance of an emergency fund
And thus comes the idea of having an emergency fund.
For all my life, I have scoffed at the idea of having an emergency fund. Why put your money in a no-interest savings account when you could put it in the stock market and make more money?
But reluctantly I started putting a few hundred dollars away. A little bit every month, for many months. I would see all that cash just sitting in my savings account and I would sneer at it but keep it there, in my very low inters rate checking account.
And here it came, a reason to use my emergency fund. The Coronavirus! It’s something that none could have imagined. It came out of nowhere. But of course, all emergencies have that characteristic, they are emergencies because we have a hard time predicting them.
From now on, I am a big proponent of emergency funds
Here’s how I propose to plan our finances.
- Pay off any high-interest debt. In my eyes, anything about 4% is a high-interest debt.
- Pay yourself first. Take a consistent percentage of your income and put it into your retirement account
- Take a little bit of money each month and build an emergency fund equivalent of three months of your living expenses.
- Enjoy whatever you have left in consumer goods or experiences.
How are you handling this coronavirus emergency?
Do you have a regular paycheck?
Have you lost your income or part of it?
Share your experience in the comments below.
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