A guide tour over 15 personal finances lesson we all should learn from the year of COVID-19 pandemic

Feb, 2021 - By WMR

In view of all that has happened in 2020, there is a lot of economic problems that need to be measured. With all these, there are also various personal-finance lessons we can learn in order to keep us on good stats whatever the economic condition remains.

There are few lessons that have been addressed by financial advisers and others to present in the last year

Disasters do take place

It is clear from the past tumultuous year that Americans should work to create an emergency fund that can reduce the need for a cut in spending when facing problems in the income.

Buy when others are scared

Manage your risks

According to the TIAA Institute-GFLEC Personal Finance Index, one of the most important lessons we have learned from the year 2020 is the need to manage the risk even in personal finances because it is better to be secure and safe than sorry.

One need a will

The big lesson we have learned from 2020 is that we should be prepared for the worst.

Your personal finances reflect your values

The year 2020 has reminded people what is important and they value and has also supported in identifying what is not important. This has an impact on the decisions we make regarding how we manage our expenses.

Retirement plans need flexibility

The pandemic has shaken the nation so badly that many Americans had to delay their retirement as both long-term financial and a short-term fix. According to a survey on retirement attitudes and expectations by Age Wave that was conducted in partnership with Edward Jones, around eighty-one million Americans citizens revealed that their retirement plan has been impacted by the pandemic

Things won’t remain bad—or good—endlessly

This time is completely different.

The unexpected global pandemic was met with the unusual speed of fiscal policy and monetary adjustments and the fastest development of the vaccine witnessed. It was proof that the market got stable itself out.

Markets always fool us

The lesson we learned from this is if no one can even explain the past, then think how pointless it is to try to forecast the market’s future.

You should have a three-bucket strategy

A three-bucket strategy is an ideal approach as investors can reconsider their decision on how they should invest their money. The three-bucket strategy includes a short-term bucket, intermediate-term bucket, and a long-term bucket. All these approaches help in preparing investors for any short-term risk such as coronavirus-related recessions

Rebalancing pays off

One should rebalance their portfolio when movements cause in the equity mix in order to deviate from the target percentage. It is an ideal way to buy low or sell high.

Stay invested

The 2020 years has prompted the importance of staying invested.

Have a side gig

One should have a mix of income sources. The pandemic has compelled many global citizens to use different techniques to create new income sources through selling courses, blogging, writing e-books, coaching or consulting, posting video content, etc.

Bonds are still very crucial

Bond exposure in early March has offered investors a great rebalancing opportunity. It has helped the investor stay the course and reduce emotional selling over this time.