Money and insurance

How financial planning helps you recover your pandemic losses and more

Whether you’re a business owner, employee or self-employed, your financial wellbeing was probably affected by the pandemic. Here’s how financial planning can help you recover and prepare for the future.

Thousands of Filipinos lost their livelihood during the pandemic and are now just starting to recover financially. If you’re one of them, start with solid financial planning because it can improve your life in ways beyond just having money.

Lack of money is one of the worst contributors to stress. According to a survey, 14.5% of Filipinos associate stress with money, including financial uncertainty, impending bills, and lack of budget. Attacks to your financial wellbeing can be detrimental to your physical wellbeing, triggering mental and emotional distress, which can lead you to engage in unhealthy coping mechanisms and more health risks.

By doing the necessary work to get your finances in order and securing yourself and your loved ones from unexpected medical expenses, you’re also adding years to your life with greater security. Here are reasons why financial planning is very important.

 

1. Family stability

The pandemic made everyone realize just how important financial stability is in everyday life. When your income is curtailed, you can still cover your household bills and provide for your family's needs if you have financial stability. Furthermore, marriages and familial relationships thrive without the added burden of financial strain. This pressure can sometimes cause conflict between couples, and bickering parents negatively affect their children’s mental health. You don’t want your kids to witness that.

2. Emergency preparation

Nothing in this world can be predicted a hundred percent. Accidents, income loss, emergency medical procedures, a fire, tuition fee increase or typhoon damage are things beyond our control. As the pandemic taught us and as Mother Nature continues to teach us, we can lose everything in an instant. An emergency fund helps you prepare for these things so your other financial goals are not derailed.

3. Goals

Financial planning helps you set goals and is a great source of motivation. When you have goals, you act more, your energy spent on the things you have to do. Positive Psychology says, “Setting goals helps trigger new behaviors, helps guide your focus and helps you sustain that momentum in life. Goals also help align your focus and promote a sense of self-mastery. In the end, you can’t manage what you don’t measure and you can’t improve upon something that you don’t properly manage. Setting goals can help you do all of that and more.”

4. Early retirement

Financial planning helps you to actually choose to retire early, a dream for many people. You don’t have to work until you’re 65, the mandatory age for retirement. When you plan your finances and accordingly invest to boost your retirement fund, you may find that you can actually retire earlier and perhaps only take on part-time work that you truly enjoy. No more clocking in 8 to 10 hours a day, no more getting stuck in traffic on the way to the office. Instead, you have more time to enjoy life.

You may not know the pathway to investing right now. Don’t worry, the experts do. Consult an FWD financial advisor to discuss how to strategize your goals faster. A financial expert can show you options such as FWD Life Insurance’s Manifest and Set for Life, both of which are investment-linked  insurance plans that give you protection and the ability to invest your money in funds managed by experts.

5. Overall happiness

Financial planning is the foundation of your goals, and it can lead to a better quality of life. Without having to worry about your  , you are free to spend quality time with your family, on your passions and other things that make you happy. Want to travel the world with your significant other or start a small farm? Want to volunteer to charitable causes? Want to spend more time with your children and grandchildren? While the best things in life may not be bought, money gives you the freedom to do things that you love.

 

This article is part of a comprehensive series titled “Retirement Planning 101: A 5-Step Guide to Securing Your Future”. The series aims to provide you with valuable insights and practical steps to plan your retirement effectively.