Just as the saying goes;
it is not how much you earn that matters but the amount that you were able to save form your earning.
Maintaining an equitable balance between inflows and outflow in a non-epidemic situation is tasking let alone achieving same in an epidemic situation. Apparently, it is easier to spend than to labour to earn the money and at that one must learn not to yield to the temptation of spending all of one’s earning so as to have something to fall back on for investment, saving, contingent situation to mention but few.
The prices of basic items which are needed for daily survival gets higher in an epidemic situation as a result of a number of factors like; hoarding, panic buying, scarcity etc but at that, you should be able to plan your finance to not only maximize benefit from your spending but to also stay fully financially afloat.
Today, I will be enlightening us on how we can stay cash afloat in an epidemic situation using a managerial analytical too called; ‘’SWOT ANALYSIS’’. This (SWOT) stands for Strength, Weakness, Opportunity and Threat respectively.
Strength and Weakness are factors within our control i.e. they are internal factors while Opportunity and Threat are influenced by environmental factors. Let’s consider each of this component of the analytical tool separately and how it affects our finance in an epidemic situation.
Strength:let’s take this to mean things that constitutes cash inflows. It encompasses your different streams of income like salary, returns on investment, profit from trade amongst others. In an epidemic situation, you must ensure that you have some inflows no matter how immaterial it may be, something must keep coming in. Remember that a river without a source will dry up suddenly. Ensure your inflow does not totally get exhausted.
Weakness: this constitutes things that takes fund from your purse. Your weakness depletes your earnings or reserves. This encompasses daily cost of survival, accommodation, clothing etc. Truthfully, you cannot do without spending in this period, but you must ensure that any money spent is effectively utilized on needs and not wants. It will be good to have this law in mind at all time; ‘’do not spend on that which is not bread nor needed for survival.’’
At moments like this, you must ensure that your weaknesses do not overweigh your strength. Keep all cost within reasonable check. Don’t spend to impress, don’t spend on Gucci and designer, spend less on automobiles and some non-essential items.
Opportunity: this constitutes avenue to make more money occasioned by environmental factors. Although it’s an epidemy, but there are still opportunities to make more wealth. Maintaining a balance personal finance at a trying time like this requires that one learns how to spot opportunities and put the necessary resources in place to utilize them. Frankly speaking, this brouhaha will come with number of opportunities and our minds needs to be trained to utilize them.
Threat: this constitutes environmental factors which are likely to have an adverse impact on our cash inflow. Several cash threatening situation occasioned by government decision will arise. Individuals and corporate entities will have difficulty in performing their daily duties and at that, salaries will be affected, awarded contract will be delayed in execution, companies will start downsizing as a result of their inability to meet up with their financial obligations amongst other likely adverse occurrence. The aftermath of this we all know affects individuals (you and me). It is pertinent for you as an individual to carefully analyse your market/industry and the likely adverse impact that it is exposed to. You as an individual must proactively act to checkmate this so as not to be met unaware.
We all need to take responsibility to fully stay financially afloat in this epidemic situation. Building on this concise explanation, carefully analyse your peculiar case/industry using this model (SWOT) and proactively put the needed measures in place. It is possible to be financially afloat in a trying time like this; you only need to plan and take proactive steps where necessary.
Written by Banjo Daniel (ACA)