Smart About Money: What now?

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Nick Maffeo Sep 1 2020The Coronavirus is still very much still with us. But as the months go by, many things are starting to feel more normal. Some people are looking around and asking, “What now?”

While no one saw the Coronavirus coming just the way it did, looking for ways it might be possible to benefit in the future because of the Coronavirus is absolutely a good response. So, what now?

In the past few months, many people have noticed that an obvious “side effect” of the Coronavirus was that they spent a lot less on entertainment, restaurant meals and travel.

Some are realizing that this new habit the virus forced on them is actually providing an unexpected insight into a way they might be able to grow their savings fairly easily – specifically, by spending a little less on leisure activities. Or, for some, a lot less.

Yes, everyone wants the economy to recover and everyone wants to support industries that have been so badly hit. Plus, people want to get out again.

When it comes to your personal economy, using the virus experience to spend less now to build your savings guarantees you will have money to spend to help the economy today … and in the future.

Edward Jones Managing Partner Penny Pennington recently told The Wall Street Journal  her father always hounded her to save, and now she is so glad she listened to him. “No one ever regrets saving for their future,” she said. That’s true!

On another topic, it seems that a lot of people who are receiving unemployment benefits are not having taxes withheld. Withholding is not mandatory and many are sure Congress will ultimately decide to forgive those taxes.

That could happen. Or not. If the economy is bad enough, taxes could go up.

The safest plan is to have the withholding taken out now so that the money will be there for you next year if the taxes do come due. If they are forgiven and you get a refund, that will be a pleasant development. But if the taxes on unemployment benefits are not forgiven, you could end up owing a considerable amount with no withholding to cover all or part of it. This is your chance to avoid an unhappy surprise in April 2021.

Last, people have had a lot of time to reflect on what they’re doing and not doing with their lives. In that way (if nothing else), the Coronavirus situation has a real opportunity to be a blessing in disguise.

Many will be so happy to go back to their old lives. And that’s fine. “Back to how life used to be” is good. Yes, there will be some changes to adapt to. But there are always changes in life and plenty of times the new ways actually turn out to be okay or even better than the old ways after a while.

Others have seen they were tired of how some parts of their lives were and they’ll go in directions they may never have considered or allowed themselves otherwise.

It will be ironic – but welcome – if having less control over their lives for a period of time gives people a chance to appreciate the control they do have along with a determination to make the best of that chance, whether it’s doing more or doing less, doing everything the same or many things differently.

Building your savings, preparing as best you can for the unknown, enjoying your life and your loved ones right now – as we move forward, those are all excellent possible ideas to consider if you find yourself wondering, “What now?”

Nick Maffeo is the President & CEO of Canton Co-operative Bank in Canton. Have a question? Email to info@cantoncoopbank.com.

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