Coronavirus Check-In: 6 Things You Can Do Now to Take Care of Your Finances
March 30, 2020
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The novel coronavirus outbreak has caused most of us to limit public exposure right now. Here are six things you can do financially while you fight boredom within the confines of your home.
1. Organize your financial documents
Have you been putting off scanning and filing that stack of paper on your desk? Now is the time to organize! Go through and see what needs to be kept and what doesn’t. If you have your own scanner, scan what needs to be kept and then shred anything else. If you don’t have a shredder, place all documents in a box and label to shred at a later date. Free shredding is often available through local city or county recycling services, or you can purchase your own ID theft stamp online to mark out personal information.
2. Paperless or paper
This is the time to evaluate what you want to keep receiving in the mail or what you receive online. As you go through your documents, you may be surprised what bills or other documents you don’t want to receive copies of anymore. Most documents will offer the option to go paperless and direct you to the website to do so.
3. Auto-pay
Again, this is the time to be thinking about what bills you want to be automatically paid or debited out of your bank account. We’re all busy and now is unique time in which we can step back and try to put things on auto so that we have less to keep track of. You may want to keep closer track of some expenses over others that remain the same each month.
4. Emergency fund
I think this is one of the most important things you can evaluate. Everyone should have an emergency fund, but everyone’s amount will vary. Traditionally, a financial planner would say to have between 3 to 6 months of living expenses depending on your situation. We usually use a “soft pillow” test if someone is unsure. What amount in the bank is going to keep your pillow “soft” so that you can sleep without anxiety? For us, we have been recommending retired clients keep one to two years’ worth of living expenses in cash stored in easily accessible savings accounts.
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5. Reassess or confirm goals
This is a good time to check in with your financial adviser to confirm your goals and that you are on track to meet them.
6. Long-term focus
Don’t panic. It’s challenging to not let your emotions get the best of you when the market is extremely volatile. But once you know what your goals are, remember to stay focused on them. Most of us have a goal for retirement. Keep that long-term focus and don’t let short-term volatility influence you into making decisions that will derail your future plans.
Jennifer Pagliara, CFP, CTFA, is an executive vice president and financial adviser at CapWealth and a proud member of the millennial generation. Her column speaks to her peers and anyone else that wants to get ahead financially.
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