Most people have come to the acceptance that life has changed and they are going to have to conform to the “new normal.” However, the majority of people are asking just what is that going to be. It is something that is going to apply to many different segments of each person’s lifestyle and it is going to include the finances.
Options For The Doom and Gloom
In a previous post about finances and the Post-Pandemic we outlined what seems to be the forecast for the economic future which can be presented in no other way other than doom and gloom. The virus has robbed everyone of something, but one thing it cannot take away from you is control over your life. So that gives you two options for how you want to deal with the Doom and Gloom forecast.
Option One
You can let it swallow you up and put you into panic mode, followed by “a nothing you can do about it” way of thinking. This option is going to make life miserable for you.
Option Two
You can put together a what-if plan for your particular financial situation. Think of this situation like any other problem you have had to face in life. You can tackle it head-on and make whatever adjustments necessary to get you through.
One of the biggest issues is that what is going to happen in the economy creates a domino effect. In other words the decisions that you make are going to have an impact on others including entities outside of your family. So your actions are going to have an indirect effect on what happens with the economy.
Here is an example of the domino effect:
You are not working so you cannot afford the luxuries in life. For example you cannot afford to take the family out for dinner once a week.
- Your neighbourhood restaurant is feeling the impact of this reduced business.
- The restaurant has to lay off several employees.
- The owner cannot meet the rental payments
- Now the owner of the property is not receiving money from the restaurant so he cannot honour his mortgage payments.
- Now the mortgage holder is being affected.
Also, don’t forget we haven’t even mentioned the impact on each of the restaurant employees that were laid off and how now this is going to have a ripple effect in each of their lives and those affiliated with them.
So What Is A Course of Action?
For the purposes of an example, let’s say an “Operation Co-Operation” was developed. It could go something like this:
Starting from the bottom of the domino chain in the above restaurant scenario:
The mortgage holder:
The mortgage holder on the property owner for the restaurant could reduce their interest rates.
The Property owner:
Could then reduce the rent that the restaurant had to pay.
The Restaurant owner:
Could modify their menu. Perhaps offer less expensive meals. This would increase the amount of clientele who could now better afford it. Giving him a chance to hire back some additional employees.
The Patrons:
The patrons of the restaurants could work on their personal budget where they could cut back slightly on other things which would give them that little bit extra to enjoy a meal at the restaurant once a week.
Just imagine if this scenario was applied across many of the other industries. It would eventually allow the economy to stabilize and to grow once again.
There has been a lot of talk about this financial emergency that the country is in is going to be far worse than the great depression. Be sure to read tomorrow’s post on comparing the 1930s to 2020. You may find that this doom and gloom forecast may not be as devastating as you are currently thinking.
In the meantime if you have some tax issues on your list of responsibilities I would be able to help you get this filed or assist you in finding solutions for your tax matters. Just give me a call at 416-398-1700.
