In these uncertain times of COVID-19, the big question for many of us is do we still save, do we still invest or do we still maintain the 50:30:20 budget allocation rule for prudent financial planning? The budget rule is an intuitive and simple plan to help people reach their financial goals. The rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must-have or must-do. The remaining half should be split up between 20% savings and debt repayment and 30% to everything else that you might want. This leads to the following tips for navigating and maneuvering in the times of crisis.

  1. Prioritizing expenses

Prioritizing your expenses is not an extra skill or self-care that one needs to do on new year’s resolutions but is rather an essential task. At this point, Covid 19 crisis for example, one needs housing, food, utilities, medical supplies like masks, sanitizers and if you have a budget for additional needs include internet and insurance these can be critical to everyday life. First thing one wants to do is make a list of priorities.

2. Hold on to investments

Shareholders may be tempted to sell their shares from the fear that they may not be performing especially now, however, selling them at this point will only make you losses. It’s better to hold on till the economy is back and maybe then consider disposing one’s investments. For any deposits or saving contributions, one may want to shift their savings to a temporary but a more accessible solution. There is no need for one to make savings on a plan that will require them to physically visit business premises to process their withdrawal request. At this point you need quick cash access as much as possible and less movements.

You could also consider investment options that offer you liquidity. Instead of options such as real estate that might be difficult to dispose of easily, consider money market funds or global markets options such as MansaX by Standard Investment Bank.

3. Be Different, Go Frugal

One of the most insightful quotes you might have come across on the internet is that these crises will not leave us the same, things have changed, we shall change and we shall have to act different. From physical touch to socialization and now managing your finances. Acting differently financially means developing an economical mindset in all things and identifying ways you can save money. Identify expenses that siphon a big chunk of your cash, drop subscriptions that you don’t need now. Keep looking for more of these minor ways to save money. All the little savings will add up to a lot.

4. Take time to analyze

Analyze the monthly/annual memberships you have for gyms and social clubs. See how often you actually utilize them. If your attendance is less than 30% in a year, consider giving these memberships up. Also, have a look at the paid software you have on your laptop and phone. If you have not used them for more than 6 months, consider downgrading to the free versions or using the many other free alternatives available online. Go through your investments and savings, if they have not given you as much return as you expected, take time to evaluate, engage with a financial advisor or research on alternative options.

5. Adjust to avoid panic.

As hard as the crisis sounds don’t panic, be financially thoughtful. In this time, it can be very tempting to follow the crowd and make rush decisions such as panic shopping. It’s important for you to stay grounded and understand when you need to make a financial decision and what should inform that decision. It’s important to adjust with the times, you can no longer follow the 50/30/20 rule. Previously, 50% of your salary should go toward things that you need (E.g. Food, rent, education, EMIs etc.), 30% on things that you want (E.g. Restaurants, movies, non-food shopping, travel etc.) and 20% allocated to safe investments but for now it seems we shall allocate 50% on essentials and 50% on emergency savings fund.


Observing the unfolding economic disruption can be frightening even if you are fortunate enough to have a job in hand or a source of income. While we wait for things and lifestyles to return to normal, following the 5 tips above to navigate the crisis times is essential. The extended crises will help you analyze what you really NEED versus what you WANT. Remember that the tough crisis period will not last forever and therefore any financial decision one makes now will have repercussions later. One needs therefore, to make the best of the crisis time to come out financially stronger.

This article was written by Elisha Ogutu, Marketing & Communications expert at Standard Investment Bank.

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