?? The corona pandemic puts people in financial need
?? Warren Buffett has advice that will help
?? You don’t have to own stocks to follow Buffett’s tips
On August 30th, 2020 the legendary “Oracle of Omaha” was celebrated his 90th birthday. A few weeks earlier, in July, Doug Whiteman, the editor-in-chief of “MoneyWise”, published a compilation of several Buffett pieces of advice on managing money and implementing it in the current corona situation – even if one is not active in the stock market.
Benefit from low interest rates
The stock market guru is known for grabbing good opportunities by hand. But people who are not involved in the stock market can currently do so too. Because to support the troubled economy, the Federal Reserve (Fed) – rightly in Buffett’s view – lowered its key interest rate to 0 to 0.25 percent for the time being. “Now is a good time to borrow money,” Buffett said in May at the general meeting of the Berkshire Hathaway investment firm, which he runs.
According to “MoneyWise”, the measures taken by the Fed have, among other things, lowered the interest rates for taking out or refinancing a mortgage to a record level. According to Doug Whiteman, this is a great time for a home buyer or property owner looking to move an appointment.
Be prepared for the worst
Berkshire Hathaway is also in the insurance industry. Last year, the “Oracle of Omaha” warned its shareholders that one day a “mega-disaster” might occur that would “surprise the world”. If so, Berkshire would suffer massive losses but would be ready to do business the next day.
One way to prepare for the worst, according to Doug Whiteman, is to get life insurance. In this way, the next of kin are at least financially insured in the event of a tragic accident yourself.
Don’t accumulate credit card debt
According to Buffett, there’s nothing against it Credit card even if you have encountered financial constraint due to job loss. However, one should avoid accumulating credit card debt as the interest rates on it are usually very high.
The stock market legend told of an incident with an acquaintance who was in financial distress. He had this advice for her: “If I had to pay 18 percent interest on the loan, the first thing I would do would be to use the money I had available to pay off this debt.”
According to Doug, other experts also recommend converting credit card debt to fixed credit when the debt is barely manageable. This significantly reduces the interest burden and enables the debt to be repaid more quickly.
Finanz.net editors
Image Sources: Bill Pugliano / Getty Images
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