It seems to me we have become good at a couple of things in the past month:
- Telling everyone else not to panic, and
- Panicking ourselves in private.
It has been wonderful to see help being offered financially and emotionally to the huge numbers of folk in difficult and precarious situations.
Those already in disadvantaged situations need to be top of the list for assistance.
I’m in a different category as a self-funded retiree.
Implications for a self-funded retiree
I’ve had cause for one of those private panic attacks:
- Interest rates have dropped again. That income stream has gone.
- Shares have plummeted. Because those businesses are now largely struggling themselves, dividend yield for the foreseeable future is likely to take a hit. That income stream will probably fall drastically.
- Covered calls become difficult with extreme market volatility. That income stream has stopped completely for now.
- Rent from property has become uncertain. Many landlords are dropping rent for altruistic reasons. I applaud them, but may be unable to emulate. So, that income stream is looking a bit shaky. The newly announced moratorium on evictions for non-paying tenants adds further complications.
In my situation, a dip in income means selling assets to pay the bills. No government handouts for me!
I’m not complaining. I’m lucky to be healthy and to have wonderful family close by.
There is however no denying this is a stressful situation for many of us, on top of the difficulty of being isolated.
My generation grew up with the belief that much of our intrinsic self-value relates to what we accumulate to pass down to our kids. I’ve spent my retirement so far living economically so that bottom line (assets less liabilities), which is what survives us, stays the same or goes up.
Whatever anyone says, my self-worth is higher when this is the situation.
So, what to do?
2020 appears to be an excellent opportunity to work on modifying this ‘inheritance = worth’ mindset.
I’m reminding myself that this period will be history soon enough. Asset prices will go back up and may even exceed where they were last year.
For now, the low interest rates mean my loans are getting paid off faster than expected. It’s a silver lining to the cloud.
I’m telling myself that not having to draw on public money to survive is a reason to feel worthy too.
During my lockdown, I’ll be getting out my stamp collection. I’m getting it in good shape to hand down to my grandkids in case there’s no money left 😉
I’ll be working on the family tree and digitising old family photos. I had to come up with some good alternatives to cleaning!
I’m also going to get online and buy stuff to support Australian businesses wherever I can.
Stay safe everyone. See you on the other side.
Want some more timely help to cope with income uncertainty?
Check out our earlier articles:
- What to do amid market turmoil: grab your towel (it’s a Hitchhiker’s Guide to the Galaxy reference!)
- Money in the Time of COVID-19: 15 tips for coping
- Emergency cost cutting: for when you don’t know what’s coming