What To Do In Times of Financial Uncertainty
Five steps to take when your finances are looking shaky.
We are living in uncertain times. The ongoing unpredictability that comes with a worldwide pandemic is making many people question how well-prepared they are financially to weather this latest storm. There are no easy answers, but in times of financial uncertainty, there are a few pieces of advice we can all benefit from.
Don’t Panic
This isn’t the first financial crisis and it won’t be the last. Unless you need to get money out of the stock market, don’t stress too much about your portfolio, 401(k) or other stock market-linked investments. You invested for the long-term, and long-term the stock market does tend to recover. It may not seem like much consolation right now, but it does. The average annualized return of the S&P 500 Index is around 7% over the long-term, and that’s after adjusting for inflation. So if you’re worrying right now about what your pension will look like in 20 years’ time, that’s not a good use of your energy. No-one can perfectly predict the future, but this is something to always keep in mind in uncertain times.
Educate Yourself
There’s never a bad time to brush up on your financial education. While it’s often essential to consult a professional about your finances, it’s also vital that you fully understand them yourself. If you do need to talk to a professional, having a good grasp on personal finance issues is a plus. Having an idea of what your options are can mean you’re much better placed to help them help you. There are various blogs, books and online publications you can turn to for a range of tips, explanations, and clarifications that will support you as you think about how you’ll manage the various issues that this crisis might present you with.
Find Out What Help Is Available
There have been many government announcements recently, around the world, about how much financial help will be available to their citizens. Governments want to get people through the current crisis and out the other side. Some US citizens have already seen government issued stimulus checks hit their bank accounts, so wherever you are in the world, take a look at what is on offer. For US citizens, Investopedia has created a useful page that aims to help you assess how the Coronavirus Stimulus Bills will affect you.
Assess Things Very Carefully
Now is a good time to take a very close look at your finances, assess and plan. Credit card companies and other creditors may put specific programs in place to help their customers during this time. Banks may waive fees, and various companies may support their customers to manage their accounts better as the crisis progresses. However, fortune favors the proactive. You may need to dig around to find out what’s on offer, and what some of the companies you use are willing to do.
Seek Guidance
Even if you usually consider yourself financially astute, uncertain times often mean we all end up a little out of our depth. Now may be the time to seek guidance from a professional regarding your finances. Remember that some non-profit credit counseling services are free to those that are eligible, or highly affordable. Even if you are currently in an area on lockdown, most of these services are offered over the phone, and some financial professionals will be working overtime right now, to assist those who need advice and reassurance.
Disclaimer: The information in this article is not intended to encourage any lifestyle changes without careful consideration and consultation with a qualified professional. This article is for reference purposes only, is generic in nature, is not intended as individual advice and is not financial or legal advice.
Originally published on Wealthtender.com.