Easing the hit on your finances during the pandemic
Posted May 3, 2020 8:39 p.m. EDT
Updated May 4, 2020 4:02 p.m. EDT
Raleigh, N.C. — The global COVID-19 pandemic has impacted and is still impacting our wallets.
Many people have questions about their money, their savings and their retirement plans.
“I don’t see it as a 'V'-shaped recovery, where it went down and it’s going to pop back up,” said Gerald Townsend, a financial planner and president of Townsend Asset Management Corp.
Whether a person is young or ready to retire, many are worried about finances, especially under the circumstances.
“Some think they’re worse off than they are because I’ve talked to some. They see the market is down 30 percent, and they think that means they’re down 30 percent, and many times they’re not invested exactly like the market,” Townsend said.
For those ready or close to retiring, hopefully you don’t have every dollar invested. While it may take you a bit longer to recover, there is a silver lining.
“The only thing I can say there is to remind yourself you’re not taking everything out. If you take three or four or five percent out of investment, you’re still keeping most of it invested to heal and grow,” Townsend said.
For those who have several years before retirement, think of this as an investment.
“But you’re not going to use that money for a long time. In fact, you can look at it another way. The money you’re putting in on you’re next paycheck is buying more stuff because stuff just got cheaper,” Townsend said.
To lessen the financial impact, the goal to is spend as little as possible or even restructure debt.
“Maybe I just need to hunker down and not spend as much, not pull out as much. It’s just a time to be very conservative with my money,” Townsend said.
While Townsend believes the economy will recover, it's unknown when or how quickly. “I would not go crazy, not lose sleep over it. You will get though it. We all will get through it,” Townsend said.
Townsend said saving is crucial. You should try to have at least three to six months or even up to a year’s worth of savings set aside for times like these.