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2020: The intertwining of money and life lessons

Even those with high incomes were left gasping for cash. The pandemic highlighted the thin line separating out needs and wants

December 25, 2020 / 11:14 AM IST

As we look forward to ringing in a new year, we are very hopeful of a better tomorrow.  Any thoughts about 2020 brings a lot of bitterness and negative emotions.  There are a lot of jokes doing the rounds which say one should not count this year to one’s age since it was mostly on a standstill! While some of these outbursts may be justified, was it a complete washout?  As a popular quote goes, “never let a crisis go waste.”  I have quite a few positive takeaways for the year that has gone by. Here are a few of them.

Humans are social animals:  We thrive on interacting with people, as it is a basic need and we realised this only when we were deprived of it completely. Social interactions are the very fabric of life – they make us immensely happy and stay connected. We finally woke up to the little joys that we had so conveniently taken for granted – whether it be knocking on a friend’s door for a cup of coffee and a conversation, or visiting a loved one on any special occasion as a surprise. Hopefully, we are not going to discount these experiences in a hurry.

It was a mirror helping us see our wants and needs clearly: The line demarcating wants and needs is indeed very thin. There have been numerous occasions when we have seen clients make huge monthly spends, and when that is pointed out, they have no idea how to reduce expenses. Every expense seemed like a necessity and we were stuck.  Come March 2020, and their expenses nose-dived.  While the objective is never to scrounge on your today and live a miserly life, it is also not about just living today, without giving a though for tomorrow – in particular to financial security and freedom. It took a pandemic for a few of them to finally see what we meant when we said they were going overboard on their expenses.

High income doesn’t mean escape from financial pain:  One normally associates financial hardships with the poor.  We believe that if a person is high up in the social hierarchy, he is wealthy and is unlikely to be affected by temporary hiccups. Several aspects become apparent from our interaction with customers. A few of our customers were heavily leveraged, paying hefty home loans and, despite considerable incomes, the thought of reduction in income or loss of job was stressing them out immensely. Yes, they were wealthy by any standard, but many had illiquid assets, so how were they to ride through the calamity for months, with reduced or no income?  Ultimately, what matters is not your income level, but your level of expenditure, proper asset allocation, liquidity availability for emergencies, with the icing on the cake being a watertight financial plan.

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It is time to give: It does not matter how much we have; there is always a need for more. Our wish-lists get self-populated in a jiffy. But this year has brought the plight of many who are less fortunate than us to our attention, more starkly than ever before. I was constantly looking at people losing jobs and struggling to find ways to make both ends meet. While it’s not possible to help everyone, there are many people who can benefit from our generosity.  The pandemic has made it abundantly clear to me that setting aside a small percentage of our earnings to help people anonymously is something which will give me a lot of peace and happiness.

Health is truly wealth:  In good times, most of us take our health for granted, and all our efforts towards holistic wellness are always put off for tomorrow. The usual resolution is ‘let me start working towards fitness and healthy living tomorrow,’ which rarely comes. This pandemic has shown us clearly that health comes first – as they say, “jaan hai to jahan hai” – and has scared us sufficiently to start working on those goals immediately. We have also woken up to the fact that good health is not something we can achieve overnight; we need to give it a lot of attention and be consistent to reap the benefits of healthy living.

Local community:  When we were in the midst of the lockdown and were left high and dry, the people who helped us were the local community. Be they the security guards who walked kilometres to be at work, or the local kirana-walas who managed to bring us the essentials.  These were unknown people mostly.

At least in my case, during good times, I was busy clicking an app to get the provisions or milk delivered, but when the need arose, the local kirana shops were the ones who went out of the way to help despite having no previous relationship. I have made a mental note for ensuring that these guys get the support and respect they richly deserve even after the lockdown is done away with.

All in all, this pandemic has been devastating for a lot of friends and acquaintances who have lost their loved ones and will always bring terrible memories to them.  But to the rest, it’s time to reflect on the things which make our life truly meaningful. It’s a timely reminder to prioritize health, cut down on excess and be conscious that we are merely a tiny speck in the larger scheme of things. And that it is important for us to do our bit in making life even a wee bit better for the less fortunate ones!
Prathiba Girish is a Certified Financial Planner and Founder of Finwise Personal Finance Solutions
first published: Dec 25, 2020 09:45 am

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