I think it’s safe to say that 2020 is not turning out like any of us expected or hoped. When difficult times are upon us, it’s the most human thing of all to wish it had all happened differently (or to someone else).
I found myself thinking this the other night.
We’ve all been watching a lot more shows and movies in the past few weeks. Some good, some bad, and some just plain trashy (I’m not judging). I’ve been trying hard to find movies my whole family could enjoy, which is a bigger trick than one would imagine. (By the way, PG or PG-13 movies from 20 years ago would not be rated the same today.)
We recently watched the movie version of J.R.R. Tolkien’s classic book, “Lord of the Rings.” If you recall, Frodo (the unlikely hero) must lead a small group to overcome an extraordinary threat to the world (sound familiar?).
When he despairs of the dangerous journey ahead of him, Gandalf (the wise wizard) responds with a valuable lesson:
“I wish it need not have happened in my time,” said Frodo. “So do I,” said Gandalf, “and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us.”
I felt like we all could be speaking Frodo’s words in this time of Covid-19. Wishing we didn’t live in such times. Knowing we still have a dangerous and concerning journey ahead.
But here we are. All we can do is decide what to do with what we can control.
We are in uncharted waters, and it’s increasingly clear that nothing is clear.
I don’t say this to be an alarmist, but to share the information that we are seeing. The labor market is giving us a near real-time view of how the coronavirus is affecting the economy, and we can see that more disruption is likely as businesses lay off workers.
Behind each data point in this chart are actual people who have lost their jobs or seen their income cut dramatically. Unfortunately, this is not just a national event on tv. We can see the impact all around us: from FM Don’s to the eerily idle Sunseeker construction site.
Every one of those 20 million plus jobs were held by people and business owners who are now facing income shortfalls and dreams deferred. While the shutdown is necessary to stem the tide of infection, it’s really going to hurt.
Fortunately, there are signs that coronavirus-related legislation (like the CARES Act) will help blunt the worst effects by giving support where it’s needed. And I think it’s likely that further aid will follow once policymakers see the depth and breadth of the economic damage.
Here are some practical advice and some useful knowledge for you to use while going through this.
There will be more volatility in the stock market to come. As much as we would like this roller coaster to be over, it’s likely not. Every week that we get some good news (such as last night’s news that a biotech company had some promising results treating the virus), you will also get some bad news (Singapore, which seemed to have contained the virus has had a resurgence in new cases). You can’t react to every piece of news emotionally. We can only respond to things we can control like how much we spend, our level of social distancing, our daily eating and fitness habits, and how we treat others. These are the things we can control and we need to focus our efforts here to stay healthy, both mentally and physically.
Here are a few updates as well…
RMDs have been waived for 2020. If you don’t need the cash this year, consider skipping the distribution or turning it into a Roth Conversion. If you already took some or all of your 2020 RMD after February 1, you may be able to return it to your account as a rollover through July 15 (as long as you didn’t complete another rollover within the last 12 months). As with seemingly anything the Federal government does, there’s some fine print to this, so please reach out if you’d like guidance.
Tax and IRA contribution deadlines have been extended to July 15. The IRS extended the 2019 tax filing deadline for any taxpayer who had to file by April 15. The extension also covers 2019 IRA contributions.
Stimulus checks will start arriving soon. If you had direct deposit information on your last tax filing, the IRS should send your check to your account. If you didn’t, or the account is closed, the check would go to the address the IRS has on file for you.
You could get more from Medicare. Medicare has made some important updates to its coverage due to the crisis. Telehealth benefits are expanded, so you may be able to see your doctors over the phone or online. Many plans have relaxed their definition of “in-network” providers, so it’s worth checking with your plan. Part D recipients can now request 90-day supplies of medication instead of the usual 30-day supply to help avoid unnecessary trips to the pharmacy.
I’m no Gandalf (my hair isn’t that grey or long yet), but I hope I can help lighten your load in these troubling times. I don’t know what the coming weeks and months will bring, but I do know this: we’re in it together. And we’ll get through it together.
If you’d like help acting on any of the tips above, or want to talk through some strategic moves, please reach out to us. We’re here for you, and any concern you have is important to us.
As always, thank you for the continued trust, confidence, and appreciation you show in Landsberg Bennett and our employees.
On behalf of all of us, please stay safe and enjoy your weekend.