Aren't we all ready for a fresh start?
The new year beckons after an awful year of shutdowns, sell-offs, disease, death and dismay. Seemingly solid financial plans crumbled for families and businesses, savings dwindled, and jobs disappeared overnight.
At least we can mine the miserable year for valuable lessons, financial and otherwise. Here's a fresh sheaf of resolutions for 2021 — all doable and all based on what we learned in the COVID wars.
1. Build an emergency fund
It turns out that having just $2,500 socked away can mean the difference between muddling through a crisis or falling off a cliff. That's based on research from the University of Colorado Boulder and Universidad Diego Portales in Chile. To get to that level, direct your bank to move a regular amount to a savings account every month. Do so even if you have credit card debt. And keep some of your money at home, in both large and small bills, suggests Sheryl Garrett, founder of a network of financial planners. Who hasn't needed cash to pay or tip people who are delivering meals or helping out in other ways?
2. Get your affairs in order
Hundreds of thousands of Americans led a normal life one day and then were cut off from their families the next — in hospitals, nursing homes or elsewhere. So many people died without wills, plans or goodbyes. I, sadly, have attended three Zoom funerals and seen close friends dealing with grief and unfinished paperwork at the same time.
Start by filing a HIPAA (Health Insurance Portability and Accountability Act) release form with all of your doctors to specify with whom you would like your information to be shared. This will let family members get updates about your health. (Download free forms.)