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7 Ways to cope with Financial Stress and Build Financial Resilience

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7 Ways to cope with Financial Stress and Build Financial Resilience
March 21, 2024

The occurrence of an unfortunate event can often derail some of the best-laid plans. Handling such situations can be stressful and exhausting. It takes a toll on your physical and mental health. It can also affect your financial health. 

While it is important to address and find a way to cope with the physical and mental turmoil, one also needs to address how to deal with financial stress. Even during such times, it is necessary to keep building financial resilience. If you find yourself in a financially stressful situation, these are a few steps you can take to ensure financial stability for the future: 

Assess your financial situation: Most people tend to have a fair idea about their financial standing. However, if you find yourself in a crisis, this would be an apt time to know how your funds have been distributed. Start with your investment portfolio, check how much funds have been parked in your emergency fund and your savings, the status of any debt and evaluate your insurance policy. 

Assess your financial goals: Financial goals tend to be time-bound. If you are in a financial crisis, assess if you can push some of the financial goals to a later date. This will help in reducing some financial pressure. You can revisit the financial goal once things settle down and the crisis has passed. 

Avoid debt: One way most people try to overcome financial stress is by availing a loan. It takes care of the immediate fund requirement. However, it also creates additional financial liability immediately. Taking a loan would mean you would need to start repaying the loan amount immediately, and there would be an additional outflow from your income. Instead of taking a loan, try to use the funds from your emergency fund account or your savings account. 

Re-think your investments: Not every investment may generate high returns. Ask your financial advisor to help you understand how your investments are performing. If they are not performing well, it may be a good time to switch. 

Look for investment options that can help provide financial resilience and create a financial nest for the future. This can be in the form of a new savings plan like HDFC Life’s Sanchay Plus plan. As a savings plan, it helps secure your family’s future while helping create a legacy for them. This plan offers life cover, maturity and death benefits and provides Guaranteed1 Benefit payouts a long-term income option2 of 25 to 30 years. 

Automate your investments: Instead of manually making payments to your investments, try setting up an auto-debit facility. This way, your investments will be taken care of even during a crisis situation. While it may affect your current financial situation, you will be able to build a financial nest for your family for any future expenses. 

Reduce expenses: If you have already set a budget for your expenses, it may be a good time to evaluate it as well. A financial crisis may not be the best time to splurge and spend money on certain expenses. What you can do, as an option, is increase the amount you invest in your emergency fund or repay any debt. 

Invest in a good insurance plan: A good way to create financial resilience is to invest in an insurance or a term plan. Such a plan can help reduce financial burden for the future, while safeguarding your wealth. For instance, HDFC Life Click 2 Protect Super is a pure term plan that can cover your needs and provide you with benefits your family would need. You have the option of choosing additional cover for your spouse3, option of increasing death benefits of up to 200%4 under life option, etc. 

The only thing constant in life is change. Hence, it has become imperative to build financial resilience. It may seem like a difficult task when you are under extreme financial duress. However, it can be done through proper planning and choosing investments that can work for you and provide you with a financial cushion to support you and your family.

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ARN: ED/03/24/9750

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Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

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Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

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We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.

Disclaimer

  1. Provided all due Premium(s) have been paid and the policy is in force.

  2. This plan option is available if you are between the ages of 50 to 65 years

  3. Available under Life and Life Plus plan options, upon payment of additional Premium(s)

  4. Available under Life option, upon payment of additional Premium(s)

HDFC Life Sanchay Plus (UIN: 101N134V20) is a non-participating, non-linked savings insurance plan. Life Insurance Coverage is available in this product.

HDFC Life Click 2 Protect Super (UIN No.: 101N145V02) is a Non Linked, Non Participating, Individual, Pure Risk Premium/Savings Life Insurance Plan. Life Insurance Coverage is available in this product.

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