Mike and Maggie share their thoughts on the coronavirus or COVID-19 pandemic. We share a number of recent social media perspectives that are shaping and influencing our own views on the impact this is going to have on our world and in our communities. We then dig into the the domino effect the virus has had on the global economy, first with travel. As people stop traveling, hotels and airlines start to suffer, but the people working for those companies suffer more. Many hourly and low income workers are being affected by travel bans, cancelations of conferences and sporting events. When those people stop earning, they stop spending, and that starts to hurt the economy. When these pauses in travel and events go on too long, people lose their jobs and companies fail. This is why a recession could be coming.
We share our thoughts on how we’re thinking about money and making decisions during this tumultuous time. It’s important to stay level headed and remove emotion from your decision making. Don’t buy all in, don’t sell it; think about your decisions and approach the market with a plan.
Our top 3 takeaways for this episode:
- The financially vulnerable and the working class are going to be hit hardest, and that can lead to a recession. We all have an opportunity to show empathy and sensitivity during this time, and also think about how we can help those in need in our communities and afar. This could be helping someone who is elderly in living alone or helping someone who is more financially vulnerable. Our point is, many listening to this may be losing money in the market right now, but that’s a very small thing compared to the impact this will have on the most financially vulnerable parts of our world.
- Do not panic buy or sell in the market. Try not to get too excited about the wins, or beat yourself over the losses. And definitely don’t gamble. Think through any decisions or changes you want to make in your investment approach, and make decisions with great thought.
- Use this as an opportunity to get more financially fit. It is more important now than ever. There are many things we can’t control during the days ahead, but the one thing you can control is how you’re spending your money. Use this as a time to get your finances in shape.
Show References
Social media posts mentioned:
- Rich and Regular’s post
- FIRE myself by 40’s post
Coronavirus offers "a blank page for a new beginning" says Li Edelkoort
Mostly Minimal Life blog post - Coronavirus and working remotely + kids out of school
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Other Links
Maggie’s Blog: Mostly Minimal Life
Mike’s Book:
Your New Relationship with Money