Over 840,000 people applied for unemployment benefits in the first week of October.
How sad it is that 840,000 people applying for unemployment, instead of 1 million, is considered progress.
The point is that the state of your personal finances has probably been obscenely disrupted by the pandemic.
Don’t fall into pandemic panic. And don’t pretend everything is normal so you can continue conducting your finances as if the entire economic world isn’t upside down.
Here are two ways you can reassess your personal finance and not fall into pandemic panic.
Make Emergency Savings a Priority
If there is one thing that should be obvious by now, it’s that life as we know is never going to return to the, “normal,” of 2019.
That is no blanket judgment on you or how you handle your finances – I was hoping for that myself even though I know better.
Who didn’t yearn for normality after the gravity of the coronavirus pandemic made itself irrevocably and horrifically known?
Unfortunately, we cannot go back in time. And when we meet a financial crisis of the present, we must adjust our personal finances to stave off an uncertain future
However, when we are confronted with horrifying circumstances and a new reality resulting from such, we can easily fall into a normality quagmire.
What is a normality quagmire? It a personal mindset where you continue conducting your personal finances in a way that conflicts with reality.
Look at it this way – tens of millions of Americans are unemployed, on the brink of eviction, and lining up in food banks in record numbers.
Reassess and trim your budget and augment your emergency fund as appropriate.
Times are hard, but they will become a lot harder if a financial emergency presents itself in this new normal. Be financially prepared for the times ahead.
You May Not be Able to Retire Early
Retirement is a post-working life journey, not a goal. “Retirement,” is really shorthand for a retirement fund.
You should have enough money saved in a retirement fund to last you throughout retirement unto your death.
The problem with saving with retirement is that people save money for it like it is a goal and not a post-working life journey.
The other problem is that retirement can spontaneously become an unachievable objective. Like when a global economic crisis caused by a pandemic hits you in the face.
The average age at which Americans retire is 66. Yet less than 22% of Americans barely have $5,000, or less, saved for their retirement.
Another 15% have absolutely nothing saved for their eventual retirement.
So, for many Americans affected by the pandemic, a retirement future spontaneously became an unachievable objective.
Consider your budget, how much money you have, assess your bills, and assess how long your current finances may last you.
You may now be in a situation where you may have to delay your retirement target date to an even later date.
It isn’t the end of the world. After all, you are decidedly not the only person in such a predicament.
But it is better to face the reality of a delayed retirement than to run out of money quickly due to the pandemic.
Completely Reassess the Totality of Your Personal Finances
We are all living in the era of coronavirus, but there is no one-size-fits-all approach to reassessing personal finances.
Reassess every aspect of your budget and finances. Consult a financial advisor if necessary.
Don’t let pandemic panic cost you your financial future.
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Allen Francis was an academic advisor, librarian, and college adjunct for many years with no money, no financial literacy, and no responsibility when he had money. To him, the phrase “personal finance,” contains the power that anyone has to grow their own wealth. Allen is an advocate of best personal financial practices including focusing on your needs instead of your wants, asking for help when you need it, saving and investing in your own small business.
