TWM Newsletter for Q3 2020

Bruce Bendell |

A NEW NORMAL

To borrow a phrase from John Lennon, “Strange days, indeed”.  IN the last 90 days we’ve seen both bear and bull markets, the continuation of a world-wide pandemic, the introduction to whatever “murder hornets” are and a nationwide call to end racism.  Not sure we could have packed much more into one quarter.

As the world sometimes seems it’s spinning out of control, we do what we can to provide what many people crave…a sense of normalcy.  Our friends at PIMCO coined the phrase “new normal” several years ago after the Great Recession.  As the name implies, after certain events (or series of events), we don’t and can’t just go back to “normal”.  Life is different.  Things are new and we much react and adapt.  Afterall, as humans, that’s one of our best traits.  Have you considered what YOUR new normal will be? Here are a few thoughts on what we might see going forward.

CASH.  I used to take a little cash out each month to have in my wallet for those bits and pieces that it seemed silly to pay for with a card (or wave of a smartphone). But I haven’t touched my (physical) wallet in weeks. COVID-19 may well be the final nail in the coffin for cash with people having become used to no-touch digital payment for purchases as small as a socially distanced, takeaway coffee.  ATM usage had been on the decline for years and it will be interesting to see where it settles. Obviously, there’s concern for older and more vulnerable people who aren’t confident or capable when it comes to digital money. Talk to members of your family who may need to make the transition.

To borrow a phrase from John Lennon, “Strange days, indeed”.  IN the last 90 days we’ve seen both bear and bull markets, the continuation of a world-wide pandemic, the introduction to whatever “murder hornets” are and a nationwide call to end racism.  Not sure we could have packed much more into one quarter.

HOME DELIVERY. Online shopping had made serious inroads even before the pandemic. But, again, coronavirus may speed up a transition. After some initial hiccups — with shortages ranging from toilet paper to webcams — the sound of the soft drop of a parcel on the doorstep is now a regular part of our day (It’s so familiar, even my nosey neighbors rarely peek through the blinds to see what’s going on). Online grocery shopping jumped by a third in May, and clothing by 20%. Stores who didn’t see themselves as online operators are now ready, willing, and able. People who lost work elsewhere are boosting the numbers of delivery people. And I’m guessing that as much as we all want to go back to our favorite restaurant, the convenience of food delivery apps like Door Dash and Grub Hub will have us permanently hooked, too. French fry delivery at 9pm, yes please!

THE BUDGET. Finally, it may be time to make some permanent revisions to your household finances — even if you did it as the calendar or financial year ticked over.

Some may not go back to the gym, having developed a new home-based routine, and I discovered I’m actually quite good at cleaning the house (with the help of my teenage daughter). What about those who continue to work from home? Reduced travel expenses might mean a call to the insurance agent to see what discounts are available.  It all adds up to a fair amount of savings each month, and the opportunity to make that money work harder — perhaps with the advice your friendly Certified Financial Planner.

Of course, these are just a few of the changes I’ve noticed.  What about you? Have you thought about what you’ll keep doing — or change — post-pandemic? What will be your “new normal”? Let us know your thoughts and, as always, call or email to set up an appointment so that we may continue to help you navigate the often-choppy waters of personal finance.

Enjoy the Summer,

The Transitions Wealth Management team.