Returning to the Basics

Over the last month or so, we've all had a lot of time to consider the things that are important. Health, family, friends, safety, and for many - job security. It has given us more time to return to the basics.

We've all been inundated with market and economic news lately, most all of which is beyond anyone's direct control.

Here are a few things we can do to take action now:

1. Cash Flow - many clients so far have told us they're not spending much now other than household expenses and groceries. If that describes your circumstances, now would be a great time to assess what you want to add back when you can, and what may be a more permanent cut.
   
   If you have extra cash flow now, consider a boost to your Emergency Fund, or an increase to your retirement contributions and debt payments. Be sure to buy a gift card from a few of your favorite local businesses too! For anyone who has heard me speak about the Happy Money book, you may remember the part about how our brain thinks we're getting something for free when we pay ahead (like using a gift card). It's a neat trick to budget, support local businesses, and treat yourself later!
   
   We also have several clients who have lost jobs or significant income. We are here to work with you through this time. Each circumstance is different and we've worked through several scenarios to help manage the impact of this difficult time.

2. Debt Management - rates are incredibly low right now. It may be a good time to review refinancing options. Let us know before you do! The rate is only one thing to consider.
   
   If you have student loans, Federal loan payments are being suspended with no interest, penalties, or accruals until the end of September. You CAN still make payments, but if you're in a crunch, this can help. If your student loans are not Federal loans, you may be eligible for other terms - each loan servicer is different, so be sure to speak with your loan servicing company.

3. Estate Planning - while it's never a fun topic, it is a good idea (anytime) to be sure you can access your health care directives should you need to share them with medical professionals. 

4. Employer Retirement Plans (401k, 403b, etc) - we don't have the ability to rebalance your employer retirement plans outside of the accounts we manage here. Now is a good time to login to your employer plan and be certain your allocations and contributions are on track as your plan intends. While you're at it - double check your beneficiary designations! If you need assistance, give us a call! We're happy to help.

5. Insurance Policies - particularly after speaking with a few families impacted by the tornado, it's a good time to discuss your homeowner's coverage. Review the coverage for language about replacement cost vs. actual cash value (which may depreciate the value of your items) for the contents of your home.

   Also, double check beneficiary designations for life insurance policies held both at your place of work and your individually held policies.

6. Time Horizon, Goals, and Values check-up. Have the last couple of months made you reconsider any of your goals? We've heard from several individuals about how the last couple of months has made them think differently about how they want to spend their time and resources going forward. From becoming  more philanthropic, to earlier retirement, to career changes, to more travel (when we can!), are there any considerations we should be aware of to adjust your plan?

7. Tax Planning - while no one enjoys a market that trends downward, it does offer an opportunity to harvest tax losses and rebalance to target allocations in an efficient manner. Additionally, lower market values can offer an opportunity to review Roth IRA conversions.

8. Employee Benefits - if you or your spouse have experienced a job change, please remember that it may be a qualifying event for employee benefit elections outside of open enrollment.

These are all topics we can continue to make progress on while we wait for this to pass.