5 Ideas To Help You Weather The COVID Financial Storm
Some experts think that the mental and financial wellbeing implications of the Coronavirus pandemic may overshadow the physical health impact.
Social isolation and lack of human contact can clearly harm our mental health. But being unable to make ends meet, because your income has stopped or fallen off a cliff, can equally make you miserable.
Money has always been a primary source of stress and anxiety, which can lead to unhappiness if left unchecked. And if your financial problems seem enormous or impossible, it's easy to feel overwhelmed and discouraged.
I’ve previously written about how to cope with difficulty financial circumstances in This Too Shall Pass and How to Cope With Uncertain Financial Times but with new coronavirus restrictions being imposed in England and many other countries, I thought it might be helpful to revisit this issue again, with a few new insights and ideas.
Reframe Your Thinking
You might not be able to control the pandemic or the economy. But you can control how you react and the decisions you make. Tell yourself: "It could always be worse."
If your income has or will drop, it could have been worse. You could have lost your job.
If you lose your job, it could have been worse. You could have lost your ability to work.
If you lose your ability to work due to health issues, it could have been worse. You could be in intensive care (ICU).
And if you do end up in ICU, it could have been worse. You could be dead.
The ability to accept your situation and make the best of it might be easier said than done, but it is a skill that can be learnt.
Make The Best of the Resources You Do Have
Complaining about the state of the world, or your personal situation won't help you improve it.
You have to deal with the world as it is, not as you wish it was. As well as remembering that your situation could always be worse, you have to focus on the resources and opportunities that you do have available.
Integrity
Reliability
Contacts
Expertise or experience
Reputation
Vigour and vitality
Time
Skills and capability
Ability to learn new skills and ways of working
Family and friends
Now notice that I haven't included any financial resources in the above list. I've included resources that no one can take away from you. But clearly having no non-mortgage debts and a fully-funded emergency fund will give you more options and financial wriggle room.
If you are young and just starting working, it may be the case that you don't have a lot of life experience. But you do have enthusiasm, the ability to learn quickly, and no (or few) unhelpful work habits.
If you are older and have been doing the same job for a long time, it may be the case that you haven't broadened your work skills lately. But you do have life experience, maturity and a higher likelihood of being reliable.
The fact is everyone has their own unique set of resources and things they can offer to create value and be paid fairly, whatever the state of the economy. In challenging economic times, like we are currently in, you have to work smart as well as hard. You have to be adaptable and open to new ideas.
“As well as remembering that your situation could always be worse, you have to focus on the resources and opportunities that you do have available.” Tweet This
Decide Whether To Play Offence Or Defence
If your job or income looks uncertain or other financial challenges are looming, then do whatever you can to ensure that you can continue to afford the essentials. That means a roof over your head, heat, light and food on the table.
Playing defence means building up cash, pausing or reducing debt repayments, lowering expenses and earning as much as you can. You need to prepare for the worse case scenario and hope for the best.
If things look more financially stable for you, then you can play offence by preparing for opportunities that might present themselves. Might you be able to get a pay rise for taking on more responsibilities or learning a new skill?
If you are looking to buy a property (whether as your home or for investment) be patient and ready. Tough economic times usually lead to highly motivated sellers coming to the market, which means bargains for buyers.
And a slowing economy also means bargains on goods and services, so your money goes further.
This Time Is Not Different
I have no idea what will happen over the coming weeks, months or years, but I do know that life will find a way to continue. We’ve had tough economic times before. We have always got through them and life gets better.
Jobs will be lost. Some industries and sectors will be changed forever. The economies of the world will adjust and evolve accordingly. There will probably be some painful adjustments. But if history is anything to go by, human ingenuity and innovation will lead us through to better times.
I know the current situation is unsettling and many people will be worried. But focus on what resources you do have and all the things that are good in your life. Then develop a simple plan that is either defensive or offensive depending on your circumstances and preferences. Then take the best next step.
We usually grow as a person when we are out of our comfort zone. Tough economic times can be very uncomfortable, but they can also be the catalyst we need to make a meaningful change in our lives.
Do This One Thing To Be Happier
Whatever your financial situation, write, text, email, or call someone you know well and tell them what you like, admire or appreciate about them and why. This simple act costs nothing but gives a great return to the giver and the receiver.
Let me know how you get on. I'm here to help in any way I can.
Warm regards,
Jason
P.S. If you are reading this post on the day it was published, do tune in to my Instagram Live (@jbthewealthman) tonight at 7:30pm, where you can ask me any questions you might have on this same topic.