It is a fact. All of us have been affected in some way by COVID-19 — from the healthcare workers who cannot hug their kids to the businesses that have had to close their doors to the rest of us who have relatives or friends who have contracted the virus.
However, we cannot wait for the storm to pass to reinvent ourselves, create new things, and find smart ways to put our money to work.
Even though many people have lost their income to COVID-19, others still have plenty of cash on hand. As a financial planner, I've seen several of my clients make thoughtful moves with their money over the last few weeks.
If you are among the lucky ones, there are three smart things you can do with your money right now to support your community and build wealth.
Last year was a great one for the economy, and one that benefited most professionals financially. I have one client who did especially well last year and wanted to use his extra cash this year to support those who are struggling.
When we talked through ways to donate, the key was to ensure he was giving his money to a cause that aligned with his values and passions, and where it could make the highest possible impact.
After going back and forth, we settled on United Way as his charity of choice. He wanted to donate to an organization that supports kids, and his local United Way was seeking donations of protective equipment for children still in its after-school programs. He was able to provide some equipment, fulfilling his desire to give to kids in need in a time of crisis.
You too can donate your money or goods to a cause that aligns with your values: a kids' shelter; a food bank; an animal shelter; or even a hospital. There is a great need for resources in all sectors affected by the coronavirus.
The stock market has been unpredictable this season — when economic indicators have been negative, we've seen the major indices reach positive highs and vice versa.
Not being able to control the market's volatility and wanting to grow her financial independence fund, a client with extra cash did not want to put more of her hard-earned dollars in the stock market. She was looking for investments that were lower risk than her stocks but still allowed her to build wealth.
We looked at a few factors — her fixed income, time horizon, and expectations — and settled on investing in some bonds from solid corporations that are projected to grow in this economic crisis. We chose mostly blue-chip companies in the healthcare and technology sectors.
If you're interested in investing in bonds, you can do so with as little as $500 in any online trading platform. Speak to a financial planner if you need help getting started.
The local bakery in my community has seen better days. It specialized in baking cakes for birthdays and pastries and canapes for parties. With the economy at a standstill and no birthday parties on the horizon, it was forced to close.
A client called the owner and asked if she would consider baking a cake and canapes for her birthday, but the owner said the bakery had a minimum to operate. Since the client had extra cash on hand, she was able to pay the owner to reopen the bakery and deliver canapes and pastries to several of her friends for her virtual birthday party. Now, my client's friends are doing the same thing — using their extra cash to host virtual parties and getting food delivered from this bakery.
If you have a special occasion coming up, consider having treats from a local bakery or restaurant delivered to your friends and family before you get together on Zoom.
Not sure how to get started? Contact Elaine King today to learn more about making smart decisions with your money!