The abundance of time now available seems rather daunting!31 March 2020
The deadly global events surrounding the Covid-19 pandemic have been swift and of course of great concern to us all as the evolution of the disease and its effects are felt by all nations. Modern life has created a global community and we are united in our concern.
Most people are scared for their loved ones, for their well-being, and coping with the effective lock-down that sees us – correctly - tucked away in our respective homes.
The walls do seem to close in as the days blur into nights, into weekends, into weeks, with weeks of more of the same to come. This is a small price to pay as distancing is likely to keep us safe to some degree. It is the unforeseen consequences that seem to have more relevance, from wanting a haircut, to keeping provisions available for the short term, to maintaining mental health, to keeping fit. The abundance of time now available seems rather daunting!
With time available, what needs to be considered before we get to the other side of these tragic events? Finances are likely to come into people's minds at this point and each individual may be affected in different ways.
Immediate funds might be a problem and focusing on reducing expenses early could well be a good course of action. It might be difficult to spend money if you're not allowed out, but the internet of course has a way round this. Personal expenditure costs might be significantly reduced, but will this go far enough to make ends meet? You've probably got some extra time if you're working from home (and I appreciate that some vital key workers can't do this), so now might be a good time to spring clean all your money planning before this current situation ends and we hope to find some normality in the latter part of 2020.
It may be worth paying attention (if required) to sensible offers of help from lenders or landlords, but read the small print carefully as to what is really being offered. My bank and lender sent me a text offering help, thankfully not needed. Certainly, a less formal way of communicating help, however the Government is now also using this medium to send important safety information and I think this highlights the importance of speed and action.
With the Bank of England reducing base rates to a historically low level of 0.10%, many lending rates have reduced, however, so have what were relatively low variable savings rates anyway, and this may have an impact on the income you receive.
Also, we would recommend that you look at what the government is offering if you're self-employed, or if your earnings have been reduced because your position is 'furloughed' (granted leave of absence): https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
Lastly, and certainly not least, please look out for scams. If a service provider you use reaches out to you with an offer of help, make sure it really is them before you engage. Scammers seem to think they are in paradise at the moment!
Be careful with everything at the moment and stay safe both personally and with your money.
No individual investment or financial advice is provided during the course of this blog.
Keith Churchouse FPFS
Chartered Financial PlannerChapters Financial Limited