The world is making history. On January 7th, 2020, the World Health Organization identified an influenza-like outbreak as the ‘novel coronavirus’. This highly infectious disease spread rapidly despite the quarantine measures put in place by many cities around the world. In addition to the health crisis the world was experiencing, an economic crisis brought an abundance of uncertainty to the world’s capital markets.
The economy has previously experienced severe acute respiratory syndrome (SARS), middle east respiratory syndrome (MERS) and EBOLA virus, to name a few, but nothing has compared to the COVID-19 outbreak which has caused economies in many countries to shut down. Volatility has hit record levels in the global equity, commodity, currency and bond markets. This was further fueled by the possibility of record levels of unemployment.
Many businesses in Vancouver were required to close their doors in order to prevent the spread of this contagious disease. Along with these closures came job layoffs and losses. We have witnessed how swiftly circumstances can change and how important financial planning and security are for our families. Living in an already unaffordable city like Vancouver, such an economic blow would make an average earner find it extremely difficult to pay their rent or keep the electricity running.
The federal fiscal stimulus package introduced by the government included financial support that prevented the economy from falling apart−and Canadians did see some relief as they received the monthly Canada Emergency Response Benefit (CERB).
However, with high mortgage and rental payments this financial incentive has proven far from practical for those living in an expensive city like Vancouver.
Many people living from paycheque to paycheque were quick to realize the dangers of a lack of savings. What was their plan if a federal fiscal stimulus package did not come into play? How is a young family with children to get by in these times?
There were no warning signs of the impending financial crisis that could have allowed people to plan effectively and efficiently. Many people found themselves in need of a “rainy day” account but they had done little to prepare for one.
So, what next? Is it time we learned from this crisis?
It is extremely important to have a designated financial planner who can work with you on a personal financial plan that is tailored to your life and your financial goals.
The importance of cash flow, budgeting, tax planning, and saving is something we should be aware of when it comes to our personal finances.
Just as you have a doctor who checks you to ensure your health is on track, so too should you have a financial planner who helps to ensure your finances are on track, and your future is financially secure.
It is essential that Canadians recognize the positive impact a financial planner can have on their life. Working with a financial planner will provide you with security and comfort in knowing that you and your family will be financial sound, no matter what may lie ahead. There will always be uncertainty in this world and markets will continue to go up and down. Despite the challenges, your financial planner can help give you the perspective you need to make the right financial decisions ensure and keep you on track towards meeting your financial goals.
To learn more about the benefits of financial planning, visit G&F Financial Group online.
Guest post written by: Raman Takhar
Investment Specialist with G&F Financial Group