Retirement in the Time of Coronavirus: 15 Tips for How to Plan Your Future Amid this Health Crisis
I don’t think you need me to tell you. Life is different today than it was a few weeks ago.
Now is not the time to be complacent nor is it time to panic. Now IS a good time to be calm and plan, prepare and strategize — for what might happen in the next few months and for the rest of your life.
Here are 15 tips for planning your future amid this health crisis:
1. Stay Home and Save Lives
The recommendation across the world is to practice social distancing. Everyone needs to do what they can to “flatten the curve” — slow the transmission of Coronavirus from person to person.
If you are anyone, but especially if you are over the age of 60 or have compromised health, then you should really self isolate and take every precaution possible, including:
- Do not accept visitors. Experts suspect that many people are infected who do not show any symptoms.
- Postpone travel.
- Try grocery shopping during off peak hours. Some communities are even holding special times for at risk people to shop.
- Avoid any indoor environment with people from outside your immediate household.
- If you are going to see friends, see them outside, without any physical contact. Keep a distance of six feet.
2. Acknowledge Everyday Losses
Social distancing means that everyone is experiencing tremendous losses of every day activities. The resulting sense of sadness and isolation can be mitigated by remembering that everything you are sacrificing is saving actual lives.
My high school sophomore is finishing up a section on World War I. He has written quite a few essays on the topic of “the cost of war.” One line has been running through my head this week, “War is humans doing inhumane things.” The sentence stands in stark opposition to what all of us are doing this week. We are making adjustments to our lives to try to slow the pandemic.
It is the opposite of the inhumanity of war. We are making big sacrifices in order to save lives. We are doing very human — pro society things.
Dr. Maggie Mulqueen, a psychologist told NPR, “We live in an individualistic culture verses a collectivist culture. This moment in time really asks us to think differently. To think about caring for other people and to understand our inter-connectedness.”
Staying home and practicing good hygiene are good for the world right now. Pat yourself on the back (don’t let anyone else do it 🙂 ) for every little sacrifice you are making!
3. Run Scenarios with Your Retirement Plan
Don’t just worry about what is going to happen to your finances, go ahead and run some scenarios and find out. You will probably find that things will be okay, eventually.
A few things to try in the NewRetirement Planner:
Play with Account Balances: It may sound scary, but facing fears is one of the best ways to deal with them.
Be brave and enter your account balances as they stand today.
- Then, imagine where they might be in two months (maybe down even more) and three months from now (perhaps recovered). Just remember that anything and everything can change.
- See what happens if the recovery is slower. Can you sustain losses for the next two or three years?
- Do you have cash? What happens if you were to buy securities today? Or, is it better to reserve that cash for the current emergency since it will be of an unknown duration?
Try Optimistic and Pessimistic Scenarios: No one really knows what is going to happen. In the NewRetirement Planner, PlannerPlus users can set both optimistic and pessimistic values for inflation, rates of return, medical inflation and more. And, it is easy to toggle between the different assumptions to compare.
Roth Conversions: Consider if you can afford a Roth conversion while your portfolio is down. NewRetirement PlannerPlus users can model this scenario and analyze the costs and benefits.
Re Evaluate Work: As of this writing, an NPR/PBSA Newshour/Marist poll is reporting that 1 out of 5 Americans have lost work because of Coronavirus. If this is you, you may want to adjust your work income as part of your retirement plan.
Refinance Debt: Keep an eye on interest rates and see if you are able to refinance into a lower rate. Think about your mortgage and other debt (credit cards, car loans, medical and any student loan obligations) you are carrying. You can model a lower interest rate in the NewRetirement Planner to see the impact on your finances.
4. Re-Strategize if Your Retirement Plans Are Upended by the Disruption
Okay, lets say that this situation has upended your finances and you have retired or plan to retire too soon considering how your financial situation appears now.
Make Adjustments: You certainly have options for tweaking your retirement plans. A few popular retirement plan adjustments include:
- Retiring later
- Going part-time at some point or otherwise earn income for a longer period of time
- Exploring and adding passive income streams
- Downsizing or retiring abroad, somewhere less expensive
- Securing a reverse mortgage to bridge income needs to your retirement date
- Delaying the start of Social Security to boost your monthly benefit
- Reducing your expenses
Log in to the NewRetirement Planner to easily try any of these opportunities to see if it improves your financial future.
5. Get Stop Gap Help
Unemployment Insurance: Benefits vary greatly by states, but unemployment typically replaces about 45% of your lost income. And, you may be able to get unemployment even if you are only furloughed.
The recently passed CARES act has increased benefits and broadened who is eligible. And, the bill adds $600 per week from the federal government on top of whatever base amount a worker receives from the state — for four months.
For gig workers and freelancers, the bill creates a new, temporary Pandemic Unemployment Assistance program through the end of this year to help people who lose work as a direct result of the public health emergency.
Paid Leave: The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the outbreak, but there are lots of exceptions.
Housing: The U.S. Department of Housing and Urban Development has announced a nationwide eviction and foreclosure moratorium.
Defer Consumer Loan Payments: Many banks are stepping up to help borrowers get through this situation. You can look up your lenders on this list from the banking trade association to see what concessions are being offered.
Utilities: Most utilities (gas, electric, internet and water) are offering special programs during this crisis. Call your providers.
Put Stimulus Check to Good Use: Most individuals earning less than $75,000 can expect a one-time cash payment of $1,200.
6. Not Yet Retired? Keep Up Your Skills and Engagement
If You Have a Job: If you are not yet retired, it may feel like you are if you are not able to work during the pandemic. It is important to create a plan for staying engaged with your job in some way. Keep up contact with colleagues or create a list of clients and communicate a plan for dealing with the back log when this is over.
Maybe skill up with video tutorials, online classes or distance networking.
Self Employed: If you are self employed, hopefully the CARES Act, the government stimulus package, includes programs that help you. The bill offers:
- Emergency grants of up to $10,000 to cover operating costs.
- Forgivable loans of up to $10 million.
- Relief of up to six months for payments on Small Business Administration loans
Ready for Something New?: Maybe it is time for a new job when this all ends. Here are some ideas:
- 14 Reasons Why Retirement Jobs Are the Best
- Why Getting Old is for Making Money!
- Purposeful Ideas for Retirees Seeking a Second Career or Big Life Change
- Jobs for Seniors and How to Find Them
- Starting a Business After Retirement: 12 Business Ideas for the Over 50s
7. Be Very Cautious with Any Big Financial Moves
For the vast majority of investors, especially those who have a long term investment strategy, doing NOTHING when stock markets go down is the BEST policy.
The stock market goes up and down in the short term. Over the long haul, it has historically done nothing but go up. Even a worst case year- or two-year contraction of the economy will likely eventually rebound.
So, most of the time, it is important to remain calm, don’t let emotions or stress take over and just do nothing. Ignore it.
If you are considering any moves, you may want to consult with a Certified Financial Planner. Did you know that NewRetirement offers flat fee advisory services? You can collaborate with an advisor who has taken a fiduciary oath and specializes in retirement to:
- Evaluate your situation
- Help you upgrade your stock portfolio
- Develop an Investment Policy Statement, defining your investment goals and strategies for achieving those objectives
- Reassure you
Here are more tips for what to do when the stock market goes down.
8. Try Distance Socializing
Once you have social distancing down, move on to distance socializing. Here are some ideas for staying connected in these challenging times:
Join Nextdoor: This is a neighborhood based web site that lets you virtually connect and keep up with news on your block.
Host a FaceTime Cocktail Hour: Don’t gather in your living room, try logging into to Zoom (easy to use high quality video calls), Skype or FaceTime for a virtual video get together.
Text or Call Friends: Call up those closest to you and someone you haven’t spoken to in a long time. Use this as an opportunity to connect!
Get Outside: Go for walks. Go for walks with friends, just keep your distance. Remember, six feet is about the length of a twin sized bed.
Smile at Strangers: If you are able to go out, say hello and smile at everyone who crosses your path.
Virtual Netflix and Chill: The Chrome browser has an extension you can add called “Netflix Party.” It allows you to simultaneously stream Netflix with friends and it has a chat window and play/pauses for everyone in the group so you stay synced. (Maybe try one of these movies about retirement and aging.)
9. See Your Doctors Online
Cancel non essential doctor appointments. Or, meet with them over the phone or a video call.
Medicare has temporarily expanded its coverage of telehealth services to respond to COVID-19.
Medicare beneficiaries can temporarily use telehealth services for common office visits, mental health counseling and preventive health screenings. This will help ensure Medicare beneficiaries are able to visit with their doctor from their home, without having to go to a doctor’s office or hospital, which puts themselves and others at risk.
Not yet part of Medicare? Ask your health providers about their telephone and other distance options.
10. Eat Well and Exercise
Here are a few resources for keeping your basic health in tact:
- Six minute workouts — it doesn’t take long to be healthy
- Yoga at home
- Track your steps. If you don’t have a fitness tracker, try Strava to monitor how far you are going.
- Maybe you have more time for cooking right now, try some new healthy recipes
11. Keep Your Immune System Strong
According to the New York Times, there are scientifically sound ways to keep your immune system strong, besides a healthy diet and exercise. Their recommendations:
Manage Stress: Research from Ohio State University found that your body does a better job fighting off illness when it’s not under stress.
Get Good Sleep: Do what you can to get at least six or seven hours each night.
Insure Adequate Vitamin D: Research indicates that adequate vitamin D can help protect you from respiratory infection. The New York Times suggests that: “Vitamin D can be found in fatty fish, such as salmon, and in milk or foods fortified with vitamin D. In general, our vitamin D levels tend to be influenced by sun exposure, skin tone and latitude.
Avoid Excessive Alcohol Consumption: A glass of wine is fine, but studies show that too much alcohol will break down your body’s immune defenses.
12. Find Hobbies and Purpose and Hunker Down for the Long Haul
Recent analysis is suggesting that we may be stuck at home for months not weeks. Here are a few ways to use your devices beyond the endless scroll of news:
Concerts: NPR is maintaining a list of virtual concerts.
Broadway Plays: BroadwayHD, a streaming service for theater fans, brings Broadway performances to people’s living rooms. The platform is offering a free seven-day trial, along with an $8.99 monthly plan.
Learn Something: Youtube has a how to video for almost anything you might want to know. Use this time to become a budding expert in something! Learn to Tango, research World War I slang, improve your golf swing, anything! Just set a goal and get going.
Visit a Museum: Many museums and cultural institutions around the world are inspiring people to stay curious and occupied by offering free virtual tours, exhibits, videos, and performances for people to enjoy from their homes. Here is a long list of museums and monuments (and Disney World) offering virtual tours.
And, Google Arts and Culture has a vast number of interesting links: tour the Taj Mahal, London’s Natural History Museum’s Tank Room full of creepy specimens or street art in Amsterdam.
Enjoy Retirement Stories and Ideas: Explore this exciting phase of life virtually:
- 17 Best Ted Talks on Retirement and Aging
- More than 75 Great Movies about Retirement and Aging
- 60 Well Respected Books About Retirement and Aging (Fiction and Non Fiction selections)
13. Contact Your Elected Leaders
As it stands right now, the federal government has approved a relief package to provide sick leave, unemployment benefits, free coronavirus testing, and food and medical aid to people impacted by the pandemic.
Another stimulus package is expected and it may send direct payments to taxpayers and loans to businesses.
More will probably be needed to bolster financial health. Additionally, we need local, state and federal government to get in front of the pandemic.
Write your leaders with your thoughts.
14. Take the Opportunity to Review and Update Your Estate Plan
You might be stuck at home, why not put the time to good use with a review of your estate plans?
Make sure all of your documents are up to date: your will, letters of instruction, financial power of attorney, living trust, medical power of attorney, living will and all beneficiary designations on accounts.
15. Do What You Can to Control Worry, Anxiety and Stress
This is a tall order, but here are a few tips:
Limit Media Exposure: Being informed is critical. Curling up with your phone or laptop all day and endlessly scrolling is not healthy or useful. Experts suggest you set a limit for how much time you spend consuming information each day and stick to it.
Practice Four Count Breathing: I used to think that breathing exercises were baloney until a doctor explained to me that you can trick your body into relaxing by mimicking the way a healthy body inhales and exhales when actually relaxed. A good basic breathing exercise is to 1) inhale for four seconds, 2) hold breath for four seconds and then 3) exhale for four seconds. Repeat and feel your body relax.
Engage Online: Research shows that people who use social media actively — by sending messages, leaving comments or talking in group chats, for example — report being happier than those who simply scroll through their feeds, absorbing news stories and viral videos.
Set Daily Goals: Try to accomplish something each day. This will help you maintain a sense of control and accomplishment.
Practice Meditation: There are lots of online programs to help you learn.
Maintain a Schedule: There is a meme going around, a woman joking that she goes out to her driveway to sit in her car for 30 minutes not going anywhere. It is almost like being in her morning commute. Maybe you are not going to maintain the schedule you had last week, but do try to organize your day.
Write: Spend a couple of minutes everyday writing about what worries you. There is mounting evidence that keeping a journal provides a host of emotional and health benefits, including reducing anxiety.