What a Pandemic Could Teach Us About Our Finances

A pandemic poses a number of challenges that not only harms our health and our communities, but also our economies. As we’ve witnessed, the rapid-moving pathogen COVID-19 has brought daily lives of tens of millions of people to a grinding halt; thus, shaking the foundations of social classes from all income levels. This comes to show that anything can change in an instant. While it’s difficult to plan for everything, having a contingency plan can help mitigate the financial impact. If money is feeling a little tight right now, consider these lessons:

• Establish a budget and start making cuts. Now is the best time to reassess your spending and create a budget. Start off by calculating your expenses and income. If there’s a budget deficit, you may want to eliminate any nonessential costs. This can include gym memberships and subscriptions services. By limiting yourself to solely necessary spending, you’ll be able to save a considerable amount of money that could go towards mortgage, groceries, and savings. These cutbacks may not feel like much, but they can add up to a lot.
• Strengthen your emergency fund. An industry report reveals about only 40% of Americans could pay an unexpected $1,000 expense.1 One of the best things you can do for you and your family is to have a fallback fund to cover unexpected expenses. A rule of thumb is to amass an amount equivalent to three to six months of living expenses.
• Seek out opportunities. Losing your primary source of income can be detrimental, but there are many ways you can earn extra cash. Considering starting a side business from home whether it’s online tutoring, web development, or freelance writing. And while market swings can be frightening, they can also be healthy events. Times like this can be a great time to reevaluate your risk tolerance. We’d be more than happy to connect and reassess your portfolio for new opportunities.

These uncertain times can make it hard to keep a clear head. However, it serves as reminder to remain calm and know that we can recover from this. By being prepared and strategic in how you’re managing your finances, you’ll be able to overcome any obstacle life throws in front of you.

Financial Assistance Amid COVID-19 Outbreak

The arrival of the COVID-19 pandemic has shook the financial stability of millions of Americans. In addition to mortgage relief, many financial institutions of all sizes, including Ally Financial, Bank of America, Citi, and Fifth Third Bank, have taken proactive steps to offer assistance for credit card, auto, and small business and personal loans. While policies vary by institution and are on a case-by-case basis, they include but not limited to fee waivers, deferred payments, loan modifications, zero to low-rate loans, and more.

Click here for a running list of the banks that are offering financial aid to those affected by the pandemic. If you’re experiencing financial hardship, we encourage you to reach out to directly to find out what assistance they can provide.

As usual, we’re here by your side to provide guidance through the ever-changing world to ensure that you remain on track of your goals.

Get Mortgage Relief from the Financial Impacts of COVID-19

As the number of COVID-19 cases in the U.S. continue to rise, Americans are seeing their hours cut, jobs disappearing, and expenses adding up. While the situation remains grim and many are waiting to return to work, homeowners are struggling to keep up with their payments. On March 18, 2020, the Department of Housing and Urban Development announced the suspension of all foreclosures and evictions for two months.1 Many mortgage lenders are also offering relief in response to this crisis.

If COVID-19 has caused you to be financially strained and you’re worried about falling behind on payments, contact your mortgage servicer as soon as possible for relief options.

The biggest chunk of the average American’s budget goes to housing. Avoid dipping into your savings–a mortgage forbearance could allow homeowners to allocate the funds normally reserved for mortgage towards other necessities.

Got questions or need a second opinion on your options? Don’t hesitate to pick up phone and call us at [INSERT PHONE NUMBER]. Don’t let the upheaval caused by COVID-19 throw your financial strategy off-course. Let us assess your needs and recreate an action plan to help you get through this unprecedented time.

Boost Your Savings Goals with Tax Diversification Strategies

After working hard all your life and planning diligently to achieve financial independence, the last thing you want is having to fork over a large percentage of your income to the IRS. Even when you’ve left the workforce, taxes will follow you into retirement. Fortunately, there are strategies that enable you to create tax diversification to help you maximize cash flow and minimize future tax obligations in retirement:


  • Contribute to a Roth IRA or 401(k). A Roth plan offers an opportunity to create a tax-free income source in retirement with its tax-free investment growth and tax-free withdrawals. To qualify, you would need to have held your Roth for five years or longer and you’ve reached age 59 ½ at the time of withdrawals. Though Roth IRAs and Roth 401(k)s are similar, the differences lie in their annual contribution limits, elibility criteria, and whether or not you’ll need to take required minimum distributions (RMDs).1 Work with us to weigh the pros and cons of each and we’ll come up with what’s best for your situation.
  • Convert traditional IRA savings to a Roth IRA. You can contribute to a traditional IRA regardless of your income; however, you won’t be eligible for a Roth IRA if you earn too much. The workaround, known as a “backdoor IRA,” works by funding a traditional IRA and then converting it into a Roth. The tradeoff–you’ll have to pay income tax on the amount you’re converting. The upside is, once you pay those taxes, any future growth within the Roth will be tax-free so you’ll be able to take withdrawals without paying taxes in the future.2 Under the new SECURE Act, this strategy is now even more beneficial to you and your heirs. In the past, inheritors of IRAs had the ability to take distributions over the course of their lifetimes in order to minimize the tax hit and save larger withdrawls for their retirement. With the elimination of the “stretch IRA” requiring beneficiaries to deplete their inherited IRAs within 10 years, Roth conversions can be more attractive as it could reduce or eliminate a significant tax bill for your future heirs.
  • Contribute to taxable accounts. Using a combination of pretax, Roth, and taxable accounts can offer you added flexibility in retirement. A taxable account is any type of investment offered by a brokerage, such as stocks, bonds, and mutual funds. With taxable accounts, you’re only taxed on the gains portion of the account. And the great benefits that these offer are fewer restrictions and more control allowing you to withdraw at any time and for any reason without penalty.3


Once retired, many of us will have less income than we had during our years of labor; thus, tax diversification is essential to help your investments go further. In order to create this among your investments, planning needs to begin early.