COVID-19 has changed the way we live and work. For most people, our lives have gotten more
simple as we stay at home. While we are worrying about staying healthy, how to work from home, or getting back to the workplace, many of us haven't had the time to think about how to preserve our wealth. As we adjust to the "new normal" it is time to think about wealth preservation in the era of COVID-19 and how we can emerge from the pandemic in a strong financial position.
The stock market has been on a roller coaster ride after initially plunging more than 20% by March 11, 2020, over coronavirus concerns. It signaled the end of the longest bull market in history. Many people have seen their investments and retirement savings decrease sharply and uncertainty is never good for wealth preservation. You may be asking yourself should I move assets around or invest in other vehicles?
Take a look at your risk tolerance and adjust accordingly
If you are invested in pharmaceuticals, toilet paper, or Zoom, you are not going to divest yourself of those stocks quite yet. However, if you are invested in hospitality, that is another matter altogether. With investments, what goes down usually comes back up—but in the world of COVID-19, too many businesses will not come back from this. Therefore, it has never been more important to have a diversified portfolio. Depending on your age, how many years you have until you will need to access your money, and how much risk you can mentally and emotionally handle, this is a good time to talk to your financial advisor about where your investments should lie. If your risk tolerance has maxed out, you may want to withdraw from the riskier investment and opt for a more conservative approach.
Depending on your debt level before the pandemic, you may have no issues or you may have serious concerns. Banks and credit card companies are willing to work with customers. Don't let yourself get into difficulties, call your debtor directly and see what provisions they have in place.
Take Advantage of Government Programs
The CARES Act was implemented to help Americans to survive the COVID-19 pandemic. It offers a lot of help whether you own a small or medium-sized business, have student loans, or are eligible to receive the stimulus payment or additional unemployment benefits. Talk to your financial advisor about any of these programs that can help you to improve your financial security.
Buying or refinancing a home
Even though these are scary times, it may make good financial sense to refinance your current home or to buy a new home. Refinancing means paying closing costs, however some all-time-low mortgage rates are available and you can make a big future impact on your finances by refinancing now. If you have your down payment and financing secured, this is a great time to take advantage of the low rates to buy a home and invest in your future.
COVID-19 has raised many questions about how to preserve your wealth. At Chandler & Knowles we have the expertise to help our clients to weather the coronavirus. Contact us to discuss assistance regarding financial planning.