Personal Finance and Covid

The desire for a reliable game plan during Covid caused many people to compile a Do’s-and-Dont’s list. In this blog, I will discuss things you can do to lessen the effect Covid has on your personal funds, and this is the place to start thinking about a list.

Personal Finance: Things to Do

1. Set up a Pandemic Fund

2. Get Vaccinated

3. Maximize 401 Kor other employer-matched savings programs at work.

4. Ask your bank to understand the financial difficulties you’re experiencing.

5. Switch to digital insurance and re-examine your insurance policies.

6. Ask for a forbearance on your mortgage if you can’t make payments.

7. Buy into the stock market when prices fall precipitously.

8. Consider future charity donations in the light of any personal finance shortfalls. 

Set up a Pandemic Fund

The Covid 19 Pandemic has threatened job security in the following ways: 

1. You’re out of work because you become infected. The job site can also be an infection site as employers look to the government to mandate behavior at the workplace. 

2. You lose a job because you’re laid off because of Covid Causes. If your industry is affected by Covid, you could be laid off.

Personal Finance: What to Do? 

1. Get vaccinated ASAP, including the third booster shot. This should be a no-brainer, except for the anti-vaccer groups. It’s a personal choice, but if you have always received vaccines and immunization shots like the flu, then confront your thinking about the Covid 19 vaccine. Is it worth risking your life to score political points if you’re doing this? 

1. A financial emergency starts when an earner gets sick and has zero savings.

2. Wide-spread quarantining disenfranchises many.

Look into Federal stimulus options, unemployment benefits, homeowner eviction moratoriums, and health insurance availability that made the shifts in life more manageable. Many programs have been discontinued, but new developments have popped up. For instance, there’s Federal money available to pay for funeral expenses.

Personal Finance: Retirement planning and Covid 19

The biggest hit to retirement planning came with the loss of job security. Ordinary peoples’ contributions to savings, such as 401ks, dried up because of job loss during the Covid Quarantine. One of the most significant factors contributing to retirement funds is employment income, whether through forced retirement-savings programs or employee savings, which the Pandemic has walloped. IRAs, too, do not get funded without employee contributions. 

You can’t contribute to your 401Kor other employer-based retirement savings program if you’re out of work. 

Personal Finance: What to do?

Assuming an employer is contributing to your 401K account, employees need to not only sign up but maximize their contribution. When searching for a new job, add a 401K contributor to your list of must-haves from your new employer. Find an employer that does 401Ks and apply to work there. If you’re hired, maximize your 401K contribution. 

 Find employment and start saving toward retirement. If you’ve reached retirement eligibility, and it’s just as easy to retire as a struggle with the workplace demands, then make sure you’re in fine financial shape as you leave and retire. 

So what’s the bottom line? Avoid job loss or income interruption. 

Personal Finance: Banking and Covid

Services suffer when physical bank shops shut down because of covid or become limited because of social distancing. New working arrangements don’t always work because sensitive banking transactions are complicated for employees to do remotely and less secure. New working arrangements don’t always work. 

Personal Finance: What to Do? 

Keep your bank accounts active. Don’t let the bank close them or otherwise de-activate empty bank accounts. If customers are experiencing financial hardship, remember that Covid caused the government to press banks to understand customers’ problems and work to solve problems. Reach out to your bank and ask them to be understanding of your financial woes.  

Personal Finance: insurance and Covid

With the quarantine and lockdown experience, claims against accidents have dropped. The most effective consumers have been the insured, who understand and use a digital interface to handle insurance matters. Work from home or remote work is also affecting the insurance industry. 

What to do? 

In fact, switch to digital insurance systems. Do your communication through an Internet portal. Make claims on the internet. Chat up an Internet agent, but shop for the best insurance deal you can find on the internet. 

In addition, consider this: If Covid has you working at home remotely, you’re no longer commuting. Would pay-per-mile insurance policies pay off for you? It could if your commute is long. Regardless, it’s time to reconsider the insurance picture. Reduced time on the road driving means less likelihood of accidents. While you could petition your current insurance company to reduce your rates, is it time to consider the cheapest insurance policy on the market? Maybe do a switch? A bare-bones approach may not have all the bells and whistles of your current insurance, but do you really need the nice extras when driving time and risk are reduced? It’s always wise to review your insurance policies and write your congressman to complain about insurance gouging over things like low credit scores, etc.  

Personal Finances: Mortgages and Covid.

Mortgage companies confront Covid 19 every day in the form of beleaguered and unemployed customers and mortgage holders who cannot meet their obligations. If a consumer is in this boat, they have a lot of company. So much so that government insists that all federally backed home mortgages should be eligible for forbearances. As a result, troubled homeowners can apply for a forbearance.

So, what to do? 

Apply for forbearance as soon as you lose your job or experience any kind of income interruption. If you need help staying in your home, government programs are the place to go, but you must be quick before missing a single payment. Check out all the government programs available and start applying.  

Personal Finances: investments and Covid

The stock sell-off after the onset of Covid 19 was significant, driving most stock prices lower – in reality, the perfect time to buy stocks.

So, what to do? 

Observe the stock market. To grow wealth, buy low as a rule, and if you must sell, wait until the price rises. 

Personal Finances: taxes and estate planning and Covid

The overall tightening of cash flows because of the Pandemic is raising two concerns about estate planning: 

1. do we give annual gifts to charity?

2. Do we use assets to shore up shortcomings in personal finance?

Of course, these ideas are joined at the hip, and addressing one sort addresses the other. However, it’s still a good idea to consider them separately. 

So, what to do? 

First, do not write off all charity until you have a clear picture of your personal financial situation. Suppose you don’t need a lot of money to shore up your unique financial picture. 

Continue giving to charity without pause, but do not hesitate to borrow from scheduled charities if you need the funds at home. Pay basic expenses and look to make up for them after things get better. 

This article was published in 2021 and has been slightly edited.

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