Thriving Financially in a Post-Pandemic World
As life slowly starts to get back to normal, now is the perfect time to reassess your financial goals. Has your perspective changed on your personal or financial life? What steps do you need to take to adjust your path?
Are you considering a job change? Maybe you are interested in moving to a new town as more activities begin to open up. Has your retirement timeline changed, or do you want to focus on starting a new business or that side hustle you have been talking about for years? If so, it’s important to consider the financial implications these changes will have on your future. What steps do you need to take today to realize your goals in the next 5, 10 or 20 years?
Have Your Housing Needs Changed?
Maybe you have more job flexibility, which doesn’t require you to live near the office. Does your next home need a larger office? Is it time to move out of the city and into the suburbs, or vice versa? Ask yourself what you really need and want in a home, and outline a timeline to achieve your goals. When do you want to move, and how will you save for a down payment? If your credit score isn’t where it should be, what can you do to improve it in the months to come? Another consideration? Refinance your mortgage and pay extra every month so you can fast-track your payoff schedule.
Do Your Retirement Goals Look Different?
For many people, the pandemic has raised new questions about retirement. For some, this includes the idea of retiring earlier than expected or maybe adding more flexibility to their career path. If this applies to you, it is important to review your 403(b), 401(k) or other retirement savings plans to see if it makes sense to increase your contributions. You may also want to consider a Roth IRA: a retirement account where you pay taxes on money going into your account, and then all future withdrawals are tax-free. In addition to tax-free withdrawals, other benefits include tax-free growth and no required minimum distributions.
What Does Your Ideal Job Look Like to You?
The pandemic has caused many people to reconsider what they really want out of their careers. Maybe it catalyzed going back to school or allowed a flexible work schedule that is non-negotiable for you right now. Others may be looking to start their own business or dedicating their lives to a non-profit.
What steps do you need to take to make this a reality? Create a timeline of how you are going to accomplish your goals. For those looking to go back to school or earn certification, keep in mind that online education is more convenient than ever and usually less expensive than a traditional classroom setting. Take advantage of the educational, training and job placement flexibilities that have resulted from the pandemic.
Don’t Forget About an Emergency Fund
An emergency fund is a cash reserve for unplanned expenses or financial emergencies, such as car or home repairs, medical bills, or loss of income. In general, use emergency savings for large or small unplanned bills or payments that are not part of your routine monthly expenses and spending.
If there is one thing the pandemic taught us, it is that life is full of surprises. Whether you had to come up with last-minute child care because schools were closed or had to figure out how to pay your bills because of an income loss, the pandemic showed us the importance of having a healthy reserve of funds.
It’s important to talk to a financial professional about what a realistic emergency fund can look like for you. In general, you should have about three to six months’ worth of expenses in an accessible account. If you make a withdrawal, work hard to replenish it as soon as possible.
What Are Your Life and Long Term Care Insurance Needs?
If you haven’t already done so, by the time you reach your 50s or 60s, it’s important to consider where and how you want to live as you age. The pandemic caused people to reflect on whether they want to experience life in a nursing home or take the steps necessary to stay in their homes or a retirement community of their choosing. This is the perfect time to evaluate your life insurance as well as long term care insurance needs. An expert will help walk you through your options so that you have the facts necessary to make an informed decision. The sooner you start having these discussions, the more options you will have in the future.
We Are Here to Help
Consider getting extra help toward financially thriving post-pandemic by contacting one of our fiduciary financial advisors today. With so many changes to your taxes and your finances, we can help you re-evaluate your financial goals and priorities to make sure you remain on track both today and in years to come.