Taking Back Control

Once we are through this pandemic and social distancing is behind us, people will be split into two main groups. The first group will have ‘couch-potatoed’ through is crisis in their pyjama bottoms, exhausted Netflix and likely gained 20 pounds. The second will have used this opportunity to make their lives better. This could mean learning a new language or instrument, cleaning out the basement or garage, or finally taking better financial control over their lives.

The current Covid-19 situation has made many of us feel powerless. Regain the feeling of control by using this time to examine your finances, reassess your goals and implement some changes.

While the world is on pause, instead of watching the next episode of Tiger King grab a spreadsheet or folder and start analyzing your cash flow. Break it down into three categories;

1. Fixed costs, things like mortgage and car payments, insurance, utilities; things that you must pay.

2. Savings, amounts that go into RRSPs, TFSA, RESPs, emergency fund and work plans.

3 Lifestyle spending, which is the money you spend on everything else: entertainment, clothing, activities, etc.

A fourth category may be added to include credit card or line of credit payments; we can call this category Debt Service.

When a lot people look at their spending this way, they are surprised to see their expenses add up to more than what they are earning. Others realize they are not allocating enough to savings or are carrying too much debt. If any of these are a concern, left unchecked could lead to financial problems down the road. However, acting now (with my help) and implementing a spending plan will put you back in control of your finances, working towards your goals and ultimately giving you peace of mind.

For those that do not see any immediate issues, by completing this task it will help you move forward positively giving you a sense of control today, and therefore help you navigate through this crisis feeling more secure.

Either way, this process will give you a clear view of where all your money is going, and sometimes that is all you need to adjust your behavior.

Estate Planning Workbook.

Somewhere in some folder, many of you have tucked away the Estate Planning Workbook I gave you at one of our past meetings. Now would be a great time to pull it out and complete it! Having your personal and financial information recorded all in one place will help ease the burden for those whom you have left in charge of carrying out your financial wishes. Use the last page to record your passwords and all the other information that you carry around in your head that if someone else needed, they would not be able to get. This is especially important now during a health crisis. (If you need another copy, let me know I will happily send you one.)

Taking action and completing these tasks will make you feel more in control and will not only have a positive impact on your financial health but your mental health as well.

Have a great weekend,

Tracey

Source: Original article by James Burton, this is a change to help clients make their lives better, post on Wealth Professional 04-08-20