COVID-19 has undoubtedly left everyone feeling uncertain. We have all had to adjust during this pandemic, especially our budgets. This has left many people feeling uneasy about their financial situation and perhaps feeling that there is no sense making or keeping to financial goals during this time.
At the end of the day, the pandemic really shouldn’t deter you from your financial goals. In fact, these uncertain times should make you take an even closer look at them. I know this may seem like an odd stance to take but read on to consider why you should rethink, not abandon your financial goals during the COVID-19 pandemic.
Now, be sure to get your financial advice from someone certified to provide you that type of advice. But let me give you some things to think about regarding your mindset around money.
If you’ve made some investments, and don’t need the money right away, leave it where it is. The important thing to remember is that this pandemic is temporary, and the market will change.
Saving on Taxes
Despite the pandemic, it is a good idea to continue investing in your retirement fund, or an education savings fund for your child. If you haven’t set these up already, start one right away.
A retirement fund will not only help you to secure your future but help you to gain due to tax benefits (TFSA, RRSP). Contributing to your retirement fund reduces your taxable income, so the amount of taxes drawn from your paycheck every month will decrease.
Lower Interest Rates
Low-interest rates. Due to the COVID-19 pandemic, interest rates for mortgages and loans are declining. If you want to invest in a new home, now may be the time to do so.
Alternatively, if you’ve already taken the loan and want to refinance it, you should seize the opportunity and get a lower interest rate. Because the interest rates are lower, there will be less interest to pay off.
Of course, this isn’t to say that you should go out and finance things you can’t afford, purely for the fact that the interest rates are low. You should still be responsible. What I want you to understand is to not let the COVID-19 situation drive you to bury your head in the sand and forget all your goals. Times are odd, and you still deserve to set and attain your goals, you just need to adjust your thinking and be sure to take your common sense with you!
Growing Your Savings:
A great lesson to be learned during this time of uncertainty is to build an emergency fund. You should have enough money for at least three to six months, should anything go wrong. If you get sick or are out of work for any other reason, you will still have a decent sum of money to fall back on.
There’s an infinite amount of good reasons why you should have an emergency fund, it’s just a financially smart decision. Whether it’s a college fun or just for a rainy day, an emergency fund is essential to staying afloat in times like these.
Ultimately, there are many good reasons to make financial plans and set financial and wealth goals, and no time is better than the present. Even though the COVID-19 pandemic has caused a lot of confusion and worry, this doesn’t mean that your finances should suffer as well.
Always look for the silver lining in every situation and opportunities to increase your financial stability. Some of these silver linings include lower interest rates, being able to save on taxes, and lower stock prices. It may be difficult to look past the present situation, but thinking of the future is part of why we set and work towards achieving goals.
Michele Bailey is president and CEO of Blazing Agency and My Big Idea®. These two lines of business work congruently to support her clients’ success.