Single and Loving it: Part III

The onset of COVID-19 bought with it - stay in place, social distancing, face masks, and the closure of parks, restaurants, gyms, yoga studios, coffee shops, theaters, places of worship, concert venues, and no HUGs allowed! Where can singles go to meet, hang out and catch up with friends and family?  Socializing has now been reduced to group chats, zoom, and facetime, this is how we celebrate birthdays, weddings, and even date!  It’s a whole new world out there.  Fortunately, everything will gradually change to the new normal, and then we’ll be asking ourselves whenever we venture out - “Will I have a chance of catching the virus, and if I do will I be able to get the best medical treatment?” 

Last year I wrote two articles for singles and their finances - Single and Loving It: Parts I and II[1].  I covered many financial topics from a single person’s point of view.  What should the financial focus be for singles now in the Covid-19 world?

Time to regroup, and there’s no rush

In New York City life can feel like walking up a down escalator, one has to keep moving just to keep up.  During this “Great Pause”[2] we should take the opportunity to regroup, and there is no need to rush, everything will be changing around us for some time.  However, now is a good time to take a long view, not just next year but five to ten years ahead.  I’m not suggesting a ten plan, rather, an approach for how you can best adapt and respond to what life will throw at you in the years ahead.  The future is going to be very dynamic and unpredictable and being single can amplify events.  For example, we cannot predict how we could be without income for a time or what could cause a sudden drain on our resources, but we can prepare for and reduce the first and second-order impacts of such an event.

“...securing and holding a job requires dynamic stability - you need to keep pedaling (or paddling) all the time.”[3]

Consider what companies are in the middle of right now - everyone is working at home, will this become the mainstream for companies, and will they need expensive city office space in the future? Will you be able to have a career at a company and never leave home?  Jobs were already being disaggregated and pulled apart and no doubt this will continue at an even greater pace.  Change can be unsettling but it can also bring with it opportunities.

“you are literally marching into a forest that no one has explored in search of a thing you have never seen.” [4]

Are you investing in yourself and your future?

Investing in your own education and development is as important as saving for your retirement.  One of your goals will need to be continually improving your ability to adapt to what lies ahead and also to be prepared and able to capture opportunities that come your way.  Single people do not have a partner as a contingency plan.  It is important to commit to investing in yourself and to set aside money each year to improve your skills, capabilities, comfort with technology, networks, and to grow your side hustle/s.  There are also tax breaks available (Long-term Learning Credits), for education programs you undertake.  Life is more stable if you are moving, it’s just like riding a bike if you are moving it is more difficult to fall over.

“Don’t stress about the closed-door behind you.  New doors are opening if you keep moving forward.” - R. W. Emerson

Have a long-term vision, a short-term timeframe can be overly dependent on short-term outcomes and result in discouragement, have a longer-term view of success and evaluate outcomes in that context.  Aim to diversify your income streams and investments and be patient for returns.  Expect failure and disappointment can be discouraging especially if unexpected, but if we expect them, we can use them as learning opportunities for the future.  Simplify the way you get things done, complexity can be fragile, keeping it simple will make you more resilient, with a greater chance of achieving your goals.  Create redundancies despite your best efforts obstacles in life can derail plans (e.g. a pandemic), it’s more than an emergency fund, but that’s a good start. 

Your Sending and Savings Plan is not just about policing your spending, it’s about ensuring your money goes to where you want it to go, to your goals in life. 

Are you really only responsible for just yourself?

Is it only your retirement that you have to plan for?  It is common for single people, and especially women, to take on the responsibility for their aging parents, in whatever way is needed.  This makes your Saving and Spending Plan even more critical.  You not only need to navigate your own circumstances but adding the possible financial and other needs of aging parents can be a significant impact on any long-term plan. “My Retirement Plan is You”[5] was a recent article in the New York Times - “According to a Pew Research Center analysis of population data, 14 percent of adults living in someone else’s home in 2017 were a parent of the head of household, up from just 7 percent in 1995... And this trend is expected to balloon in the coming decades as baby boomers leave the workforce but can’t afford to support themselves.”

 The retirement plans of aging parents is a difficult discussion at the best of times.  When I plan a person’s retirement, I always involve the immediate family in the process, because in some way everyone will be involved. 

What kind of financial plan do you need?

Our lives can be full of static and recently a bolt of lightning has hit us all.  Many people are out of work, thinking about how to put food on the table, pay their rent or their mortgage, and small business owners have been devastated.  Conversely, people that have been working from home now have bank accounts brimming with cash and zero credit card balances; whatever your circumstances we are all focused on keeping ourselves and others safe and well.  For financial planning to be valuable it must deliver real help fast.  A traditional financial plan format of, analysis, diagnosis, and recommendations (a “Master Plan”) can become out-of-date shortly after the plan is delivered.  Imagine if I delivered a client a 25-page financial plan in February; in March the whole world was turned on its head.  Planning needs to be active, continuous, and recognize that a person’s situation can be messy and there is not one problem to solve only a set of concerns that may be all over the map.  At Boerum Hill Financial Advisors we deliver real help fast, we create a complete picture of a client’s financial life and goals (an Asset-Map and Target-Map) and deliver a series of clear interventions or steps, monitor progress and then make adaptive moves always with your goal in mind.  

At Boerum Hill financial Advisors we want to work with you and help you to regroup and create a financial picture and move your finances to where you need them to be, understanding that there will be bumps and challenges along the way.  Now is a good opportunity to align your finances with what is important in your life.  With that, you will achieve a sense of control and peace of mind about your finances, confidence in the direction you are heading, and a sense of empowerment. This is what we do best for our clients. 

If you have questions, please schedule an obligation free consultation.  I know finances can be confusing, we will work with you in a clear simple way to understand your financial picture today and how best to create your financial future in the new normal.

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[1] http://www.boerumhillfa.com/resources/blog/item/single-and-loving-it-financial-readiness-for-singles-planning-for-retirement.html

http://www.boerumhillfa.com/resources/blog/item/single-and-loving-it-part-2.html

[2] http://www.boerumhillfa.com/resources/blog/item/the-great-pause-an-opportunity-to-spring-clean-your-financial-life.html

[3] “Thank you for being late” - Thomas L. Friedman, page 205

[4] [4] “Thank you for being late” - Thomas L. Friedman, page 223

[5] New York Times - May 2, 2020