The Coronavirus (COVID-19) Pandemic & Your Finances, Where Do We Go From Here? The Building Blocks of Financial Planning by United Capital Management of Kansas
The coronavirus pandemic has touched all of us in one way or another. Yet, even in the midst of a global pandemic, there have been some silver linings. Neighbors helping neighbors, evolution of technology at a record pace, more quality time with family as many worked from home and homeschooled. Zoom meetings kept many Americans working, and we got back to basics, baked bread, cooked at home again and ate with family around a kitchen table.
It's time to make lemonade out of the lemons. With interest rates at historically low levels now may be the time to consider refinancing your home mortgage. If you carry a credit card balance call your company to inquire if a lower rate is available. Use stimulus funds to pay down debt.
Also, let’s not forget the fundamentals, the building blocks of any credible financial plan:
- Create a safety net: Saving for an emergency cannot be underestimated. At least three to six months is optimal.
- Wants vs. needs: Many of us have learned to do without certain things during quarantine. Whether we wanted to or not, we were forced to cut back on certain items. Are there expenses that can be trimmed from the budget?
- Diversification and tolerance for risk: We’ve just witnessed an unusual amount of stock market volatility. Calling it a rollercoaster does not fully capture the experience. Now is the time to reevaluate your tolerance for risk. Does it still coincide with your longer-term financial goals?
- Expecting the unexpected: We know bear markets are inevitable, but a steep decline may be unnerving. While we monitor events and the markets over a shorter-term period, be careful not to take your eyes off your longer-term goals.
As always, consult a trusted advisor about specific recommendations based on your individual circumstances. A financial professional can help mitigate risk in your portfolio and identify strong opportunities.
This article was authored by Shannon Benish. Shannon is securities licensed in the states of Kansas and Maryland. She is IAR registered in the state of Kansas.
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