These are some very scary times that we are in right now.
People are quarantined. People are stocking up on everything from beans to toilet paper.
Cruises have become traveling hospitals.
The financial markets are dropping like a falling knife and we can’t see the floor.
Things seem pretty bad right now.
We should be concerned. We should have some fear.
People are dying and getting really sick.
There are very real economic repercussions in industries ranging from travel to energy to restaurants to hotels and now even banking.
In this blog post, we are going to explore 10 reasons why you should be scared of the corona virus.
However, it’s not all bad and there are many reasons to be scared, maybe even giddy with excitement about opportunities that this presents.
So, in the spirit of that, next week we will have a blog post titled “10 Financial Reasons to NOT Be Scared (and Very Excited) of the Corona Virus.”
That being said, let’s talk about the top 10 financial reasons to be scared of the Corona virus.
Here are the top 10 reasons from my perspective…
Reason# 10: You are about to retire and you are going to need a significant cash flow from your portfolio (5% or more- maybe consider waiting another year??).
Reason# 9: You are highly invested in stocks – think 80% or greater and you are not well diversified. As stocks go, so go your portfolio.
Reason# 8: You are an hourly worker who cannot afford to lose hours.
Reason# 7: You don’t have strong (or maybe any) health insurance to help pay for potential hospital costs.
Reason# 6: You don’t have a large cash cushion (3 to 4 months) of living expenses to fall back on.
Reason# 5: You could get sick from corona virus and don’t have many sick days available at work, which would reduce your income.
Reason# 4: You have a lot of exposure to individual stocks in industries like travel, energy, hotels, restaurants, and banks in your portfolio.
Reason# 3: You have a lot of debts that hamstring your finances. (If you lose your job or get a pay cut, you wonder how you would make it!).
Reason# 2: You have a job in a travel related industry, energy industry, a restaurant industry, a hotel industry, or in a bank industry. (In a time when corporate finances are tight, these are all prime for potential restructuring, acquisitions, and cost cutting by giving employees the pink slip.)
Reason# 1: You are already retired and your 401k just became 301k. You are taking 5% or more from your portfolio and can’t cut back on your expenses.
In short, the corona virus and the fallout can be really concerning for some people’s financial situations.
Here are a few questions to consider asking yourself as you review over your finances:
1) Have I saved up enough to cover a few months of expenses?
2) Is my portfolio well diversified among various stocks and bonds? Is it appropriate for my age, risk tolerance, and income needs?
3) Is my job at risk? What can you do to position yourself to be indispensable or what skills to become that way?
There are some really good questions you should consider asking no matter who you are working with!
If you are feeling scared and frightened and need guidance and you’d like to consider working with me and for me to consider working with you, feel free to give me a ring at (612) 284-2409
Material discussed is meant to provide general information and it is not to be construed as specific investment, tax, or legal advice. Individual needs vary & require consideration of your unique objectives & financial situation. Please consult with your accountant or tax advisor for specific guidance.