I want to help you financially prepare for the Coronavirus (COVID – 19) lockdown. I have prepared my 10 smart money moves you should consider making. Let me says this, there’s no crystal ball for something like this and I’d rather see you over prepared than underprepared.
10 Smart Money Moves for the Coronavirus Lockdown:
1. Refinance. Considering refinancing loans now and don’t risk the chance of being unemployed or banks making their loan requirements more stringent. The Fed dropped rates to 0 and I don’t see them going negative.
2. Spending. Prioritize your spending and reduce any spending on unnecessary purchases. Politicians are debating a fiscal stimulus package. Both sides are miles apart on a package and legislation will ping pong for some time.
3. Save. Keep adding to your emergency fund. This lockdown is projected to go on for months. Be prepared for inflation or deflation. What happened in Venezuela or Greece will happen around the world and that will effect our economy.
4. Cash. Cash is king and have it handy for emergencies.
5. Credit. Set up a line of credit. This could be a Home Equity Line of Credit (HELOC) or a credit card.
6. Health Insurance. Know your insurance and its coverage limits. The latest estimate projects that 50% of Americans will get the Coronavirus with a 2% mortality rate. The peak of the virus isn’t expected for another 6-8 weeks. If you have a disease be sure to wear a bracelet or something that identifies you as high risk to help medical personnel.
7. Life Insurance. Apply now if you don’t have it or are under insured.
8. Plan. Failing to plan is planning to fail. Have a network with neighbors and friends that you can rely on and support for food, money and other essentials.
9. Don’t Panic Sell. Don’t panic and dump your stocks. We are in a recession, the global recession I have been warning about is here, albeit different than I thought. The good news is the market has priced in a recession. Your stocks and funds will pay dividends and your bonds will pay interest. Think of this as passive income, income you can use while locked down.
10. Be ready to buy! There will be light at the end of the tunnel. I don’t want to be all doom and gloom. The closest thing I can compare this to is 9/11 when airlines, tourism and other industries stopped. Despite this and other events like the Great Recession, Katrina, Iraq and Afghanistan the market prospered. It will roar back. My idol, Warren Buffett said, “Be fearful when others are greedy and greedy when others are fearful.”
Stay safe – Semper Fidelis,
Matt Maciel, MA, MBA,
Maciel Wealth Management, LLC