4 Financial Planning Tips for a Post COVID-19 World

4 Financial Planning Tips for a Post COVID-19 World

This past year could be categorized as a nightmare for many of us as we have all been forced to separate, isolate and even abandon core components of everyday life. Things that were once so familiar now seem abstract; our business as usual has turned to business on Zoom, pants optional, while in the midst of combative kids and stacks of laundry. We’ve all been forced to embrace greater flexibility, forward-thinking practices and new habits that exist beyond the comfortability of our once predictable routines.

Although our pandemic year will forever be remembered as a dark time in human history, we can finally say with confidence that there is indeed a light at the end of the tunnel. And now, we’ll be able to enter the next chapter with a few important lessons learned, like the ability to adjust to sudden and unexpected change, perseverance in the wake of a crisis, and the capacity to appreciate people, places and things we may have previously taken for granted. We’ve also learned that we can never be too prepared (especially when it comes to our finances!), so how can we begin to plan better both now and for the future? Read on for tips on how to approach the next chapter in a post COVID-19 world.

  1. Reassess your monthly income and establish a new budget.

Hard times have forced many to reassess their financial situation; it has made us more aware of unnecessary splurges, what we are capable of eliminating and what we truly need, giving us the ability to see the value of money in a completely different light. One of the most invaluable tools that have stood the test of time — and one that continues to be a solid framework on which to plan our finances — is none other than the trusty budget document.

If you are scrambling to pick up the pieces post Covid-19, then you are not alone. Establishing a new budget with a fresh perspective and 20/20 hindsight is a helpful approach that will allow you to be realistic and gain control of your current financial situation. By creating a thorough budget, you’ll be able to plan ahead and give yourself the time you need to build up your nest egg and fine tune a larger strategy for unpredictable times. 

  1. Have more cash now that you did a year ago?  Reevaluate your goals and fund “buckets” for them.

Many of our clients have more cash than they had at this time last year after a “year off” of spending. Consider filling up various financial “buckets,” in addition to an emergency fund. Take a moment to think about what you truly value and organize these values into buckets. Focus on earmarking funds to reach goals in your short-term bucket, for example: 

  • Do you have plans to travel?
  • Are there nagging home improvements to be made?
  • Have you put off saving for your child’s college tuition?

Whatever your goals might be, we can help you decide whether to pursue an investment strategy or maintain your savings as cash. Keep in mind there’s enjoyment to be had in not only investing but spending your money in ways that contribute to your own personal fulfillment and well-being!

  1. For Pre-Retirees: Consider an early retirement.  

For those who are “T-Minus 10 years or less” until retirement, you may be thinking about retirement in a different light than you did prior to COVID-19. The pandemic has brought about changes in the workplace — many have lost their jobs as a result of an economic downturn, while some who have been able to keep their jobs are now sitting on an excess amount of cash. Newly unemployed, older individuals may need to consider early retirement, as it can be very difficult to find a new job or not worth the time and effort should they plan to retire in a few years. Some might simply be mentally ready to move on to the next chapter, while it may make sense for others to stay in the workforce longer than expected as a result of the rise in remote work. 

Regardless, if you’re on the fence about retirement, we can help you understand the trade-offs associated with these decisions, as well as the stressors that may impact the viability of your post-retirement financial plan. We’ll help you calculate whether retiring will still allow you to meet big financial goals like settling your mortgage, paying for college funds, or realizing your dream of that once in a lifetime holiday or holiday house on the beach. 

  1. Help rebuild your community & keep business local!

It is in times of crisis that we are reminded of our strength and resilience as a community. When we decide to stand side by side, lifting each other up when we stumble, these are the moments to remember for generations to come. There are so many ways we can all play a role in rebuilding our communities. A few small steps can go a long way in helping others in need. 

  • Shop small and local. By supporting a local business, you’re also supporting your town and community as a whole. You’re helping to stimulate the local economy and to generate local jobs, not to mention, you’re likely to receive unbeatable customer service or one-of-a-kind products in return.
  • Reconnect with friends and community members. As social restrictions start to ease, this is a prime opportunity to reconnect with people who you may have lost contact with over time. Carve out opportunities to work on networking with acquaintances both old and new – you never know what surprise opportunities may come your way. 
  • Attend community events. Participating in community events is a great way to discover new and unexplored ventures–especially if you’ve had to pivot or adjust your career path trajectory. Moving through your community and chipping in, being helpful in personal and professional capacities and remaining active on a local level can be fulfilling while also adding a good deal of depth to your daily life. Jumping in and elevating others could be the very inspiration you need to venture into the unknown and try something that you may not have considered before. If you live in Watertown, consider attending the Watertown Business Coalition’s (WBC) monthly Coffee Connect event. The online forum is free to Watertown residents and business people in Watertown, and is a great way to reconnect with the community and network with fellow entrepreneurs and local business owners.
  • Be generous. Currently, charities and nonprofits are suffering equally, if not more, than businesses and individuals. Many nonprofits have not been able to host annual fundraisers or generate their normal revenue.  If you are able, consider donating to charities, nonprofits and philanthropic organizations to help rebuild and support those who need it most.  Ask us about making charitable donations from your IRA!

Planning ahead for the future and asking important questions alongside the right financial partner is crucial to keeping your head above water in troubling and uncertain times. When you have an experienced, trustworthy and empathic financial advisor as your sounding board and advocate you are already ahead of the game. We are here to guide you toward wise financial decisions that will impact not only the here and now but also your future financial goals. And perhaps your dream beach house, too!

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