As we drudge through these final months of the pandemic, there is now a light at the end of the tunnel. Thanks to promising results from vaccines, our lives could return to normal soon. However, the days of normalcy probably won’t arrive immediately, and there may be a few more months of wearing mask and staying at home ahead of us.
The pandemic experience is uncharted territory for most, but there are still ways to make the most of the unfortunate situation. By maintaining your discipline, you can stay on course for a successful retirement.
Stick to Your Financial Plan
The pandemic and more time at home has likely upended your daily schedule. Those who’ve transitioned to work from home have needed to adopt video conferencing and build makeshift home offices, in addition to supervising children and their changing schedules. If you’re not disciplined, these new anxieties can influence the way you think, especially when it comes to money.
For example, the stock market suffered big losses followed by a rapid rebound earlier this year. Those investors that sold in March or April may feel slighted by the market, and it could push them away. This is akin to the millennials who were pushed away from the housing market in the wake of the Great Recession.
Recency bias can cause long-term investors to make poor financial decisions, like sell a stock after a poor week – even when their plan was to hold the stock for years. Talk through financial decisions with an experienced advisor before you make hasty decisions.
Maximize Savings Opportunities
Lots of Americans have needed to delay retirement contributions or even withdraw from their retirement accounts due to the pandemic. If you’ve found yourself in those shoes, it is important to replace the lost funds as soon as possible to secure your financial future and minimize the lost returns.
For those who have kept up with their contributions, it still may be a great opportunity to accelerate them. The market has been extra volatile throughout the pandemic, and a buying opportunity could spring up with any negative headline. Increasing your IRA contributions or further taking advantage of employer sponsored retirement plans can leave you poised to take advantage of any opportunity.
If another broad market selloff occurs in the event of another shutdown, as cases in the U.S. accelerate entering the holiday season, employee stock options could provide another great avenue for advantaged savings. Some employee stock options have been repriced following the selloff in the spring to keep the incentive for employees, so they may be more attractive than ever. This is something to keep your eye on if stock options are a part of your benefit package.
Use this Time to Explore New Opportunities
Recessions are often described as an economic cleanser, weeding out inefficient businesses and opening the market for more productive ones. The pandemic has profoundly changed the daily routines for most Americans, and it has sparked new demand in spaces such as telehealth technology. New solutions to these new problems are being generated at the highest rate in a decade, and there are good reasons for this phenomenon.
Pent-up demand from Americans who’ve weathered the pandemic thus far was materializing in cities and states as they began to lift restrictions. And even for those stuck at home again, there is going to be a persistent demand for remote alternatives to traditional services until there is a real return to “normal.” If you find yourself out of work due to the pandemic, or have some skills that lend themselves naturally to remote work, now may be a good time to launch your own business.
Contact Meld Financial to get your Financial Fingerprint™.
With plenty of uncertainty still lingering in the economy, a qualified financial advisor can help you make informed financial decisions. If you’re looking for help planning your retirement, don’t hesitate to contact our team at Meld Financial.
Our financial planners can leverage their vast experience, in conjunction with a team of financial and legal professionals, to help you develop your Financial Fingerprint™. Your Financial Fingerprint™ is a unique planning process that has been developed here at Meld through several decades of managing our clients’ wealth. In short, your FINANCIAL FINGERPRINT™ is a plan that is quick to assemble, easy to understand and simple to modify as your circumstances change.
Contact Meld Financial today to get your FINANCIAL FINGERPRNT™ today.