Being Financially Prepared Matters in a Pandemic

These steps can help safeguard your family’s financial future now and well after the crisis is over.

Estee Faranda, Contributor, U.S. News & World Report, September 21, 2020

The financial impact of the COVID-19 global health crisis has been wide, but there are some hopeful signs. The unemployment rate has fallen from its high in April, surprising many economic observers. Still, roughly 8.5% of working Americans were jobless in August, and there’s much more work to be done to safeguard the financial futures of many households.

Many Americans are being squeezed during the crisis. A recent Primerica study shared that in a survey of 662 adults with annual incomes between $30,000 and $100,000, 86% responded that they have been financially affected by the pandemic to some extent and 54% are reassessing how they approach managing money.

Despite the difficulties and uncertainties of the moment, investors don’t have to feel powerless. There are several things you can do to strengthen your financial future and weather today’s economic challenges, as well as future storms.

Develop a Game Plan for Financial Preparedness

The most important step you can take right now is to meet with a licensed financial professional to create a strategy for the future. I’ve seen time and again that people with guidance on money matters are more likely than people with no guidance to feel prepared for a personal or national crisis and to have a personal financial safety net in place.

Even an investor who doesn’t make six figures can talk to a professional about developing a financial game plan to prepare for the future. Look for a financial services provider who works with middle-income families, with experience guiding people through difficult times. A good financial professional will help you think through what matters to you. At this time, that’s likely to be bolstering your ability to care for your family financially without sacrificing future goals.

As intended and expected, many people are using their stimulus checks for household essentials, bill payments and grocery purchases. But if you can, use part of your check to take steps toward securing your financial future. By consulting with a financial professional, you can decide if that means investing, adding to or starting a retirement account, or learning more about your options.

Speak with the Right Financial Advisor For You

Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with top fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is legally bound to act in your best interests. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.

Invest in Your Financial Future

With an uncertain economy, it’s both reasonable and easy to focus on the needs of today rather than working to secure your financial future. But if you wait, you will miss out on valuable years for compounding your money or worse, you may never get started. Every day counts, so use this moment to work toward your financial goals.

Now might be the perfect moment to invest in your future, as many people are delaying travel plans, eating out less and spending less on leisure activities. If you have fewer expenses and the same income, the benefits of investing this additional money could be life changing; however, you don’t need a lot of additional money to make a big impact on your future. For example, if you started investing $100 a month for 40 years, here’s how much you would earn at different interest rates, compounded annually:

  • 3% interest: $90,481.51
  • 5% interest: $144,959.73
  • 9% interest: $405,458.93

Here’s a pro tip to get started: Consider creating different investment accounts for each of your financial goals, and then automatically allocating funds into each account. You might set up a 401(k), Roth or traditional individual retirement account (IRA) for your retirement, a 529 plan for education or a money market account for building up a three-month emergency fund. Even if you’re only able to contribute a little today, making a habit of it will have a big impact on your financial strength and security in the future.


Disclosure: Primerica is not responsible for, and does not endorse or otherwise adopt, any third-party content hyperlinked or advertised from this article, which may include information about products and services that are not relevant or applicable to or offered by Primerica or its financial representatives. In the U.S., Primerica offers securities and advisory services through PFS Investments Inc., 1 Primerica Parkway, Duluth, Georgia 30099-0001, member FINRA.

Estee Faranda is CEO of PFS Investments. She heads up the securities division of Primerica, Inc., including the retail broker-dealer and investment advisory business lines. With 25 years in Financial Services, she has had leadership roles ranging from operations to distribution. She is on the board of the American Securities Association, was named a 2018 Women to Watch by Investment News, one of 16 Top Women in Wealth Tech by Investment Advisor magazine and spent six years in the U.S. Naval Reserve.