Smart financial decisions to make for 2021
2020 has been riddled with unprecedented challenges brought on by the Coronavirus pandemic. Despite the global recession, there is hope for a recovery in the future. Some economic forecasts have predicted the Canadian economy would make a 4.9% growth in the next year. Therefore, as 2021 approaches, it is essential to make smart financial decisions. Read further for some sound financial choices to bear in mind.
1. Begin to invest
Financial wellness coaches recommend investing as a smart financial step. But the question is, where, what and how much do you invest? Experts advise finding a micro-investing app and investing with small amounts of money. Nowadays, there a variety of easy to use trading platforms such as Robinhood, which have made investing much more accessible to the general population. Fortunately, many of these apps have included a bitcoin investment option, which makes storing bitcoin convenient as you carve your financial path in 2021.
Contrary to what you may think, investing in bonds, stocks, or even bitcoins is not a complicated process. Take a look at Peter Lynch’s book, ‘One up on Wall Street.’ Did you know his financial wealth started from investing in Hanes Pantyhose? Be sure to educate yourself on investments to make the right choice.
2. Increase your trade finance options
If you are a business owner or operator, it is normal to rely on suppliers for goods to run your company. However, whether your trading suppliers are local or international, you will have to consider your options carefully. As a line of credit, trade finance helps you pay for your goods on time and addresses the funding gap your business could have been faced with. With the present economic uncertainty, trade finance is an excellent option especially when you cannot depend on your bank account to ease such bills. With an increase in your trade finance options, you save enough money to attend to other crucial and urgent business needs and are also eligible for early payment discounts; making it a smart financial decision.
How do you identify a suitable trade finance product? Usually, a lender who offers an interest-free period or substantial repayment terms is an excellent one. You should also be on the lookout for lenders with significant differences in foreign exchange rates.
3. Expand your emergency fund
Many business owners and households do not save enough towards emergency funds. Suppose you are a business owner with no emergency or “rainy day” fund, this would only put you at a more significant financial disadvantage. If you should lose a big client, your business may struggle to continue its operations.
In the household, emergency funds are useful for taking care of essential expenses immediately, such as healthcare expenses. Try to set aside a percentage of your income or revenue to build a reliable emergency fund. This way, you are guaranteed some peace during a financial crisis.
The smart financial decisions you take now and in 2021 will largely influence the survival of your business and household. Therefore, consider these tips and explore more options to have a peaceful financial 2021.