At a time filled with so much uncertainty, it is critical to remember the following mantra: DO NOT PANIC! DO NOT PANIC! DO NOT PANIC!
Say it with me, one more time. DO. NOT. PANIC.
The last few weeks have been nothing short of chaotic due to the outbreak of the novel coronavirus (COVID-19) which has swept the globe, infecting over 108,000 people with more than 3,400 deaths. Currently, with more than 500 confirmed cases and 22 deaths in the United States we have moved past containment and have been told to be prepared for disruption to our daily routine.
What does this mean?
It is possible you may have to work from home, and in the event you are exposed to the virus, feel sick or are near someone exhibiting signs of illness, be prepared to self-isolate for up to 14 days. This means having enough food and supplies on hand to cover every member of your household in the event you can't leave. Here is a short list of items to give you an idea of what you should have in case of an emergency or quarantine:
- Bottled Water (1 gallon per person for each day you plan to be quarantined)
- Anti-Bacterial Hand Soap
- Medical Supplies (contact lenses, contact solution, hearing aid batteries)
- First Aid Kit (bandages, disinfectant)
- Prescription Medication (30 day supply) plus any OTC (over the counter) meds you might need like Advil, Tylenol etc.
- Canned Foods (meat, vegetables, in liquid that can be used for cooking)
- Cereal, Rice, Beans, Oats (oatmeal, grains)
- Chocolate or some type of alternate sweet (studies show the importance on maintaining optimal mental health)
- Latex gloves, N95 face masks (respirators)
You can also follow the latest news regarding Coronavirus in New York state here.
Why does this seem so bad?
Lack of preparation, transparency from the CDC, clear direction from the government, and a President who fails to inspire confidence in the American people has caused panic across the country in the form of unnecessary hoarding of household supplies like toilet paper and bottled water, xenophobic discrimination and hate crimes against people of Asian descent. It has also rocked the global financial markets as traders desperately seek answers and a bottom to the rout.
By 10pm EST yesterday, it was clear that the world was in for another rough week. U.S. Stock market futures were down near 5% overnight which triggered a halt in trading. Over the years, certain measures were put in place designed to prevent panic from tanking equities markets and give investors time to digest the latest market news. Historically, it has worked exactly as intended and is a critical tool in times of great volatility. The Dow Jones Industrial Average (DJIA) was down 1,200 points in pre-market trading and global markets were in a free-fall for the rest of the night.
And then the market opened......
For the first time since 1997 trading was halted on the New York Stock Exchange this morning for 15 minutes following a 7% drop in the S&P 500. The Dow Jones Industrial Average (DJIA) was also down over 1,900 points when the 'circuit' was broken. Designed to prevent a free fall in equities, 3 "circuit breakers" were put in place in the event certain benchmarks were hit, the first of which occurred at 9:35am EST (only 4 minutes after the opening bell!). Trading resumed at 9:49am. If stocks continue to fall and hit a 13% drop for the day, another 15 minute pause will take place. In the event that stocks retreat more than 20%, the market would be closed for the rest of the day.
Oil War For the Ages??
More bad news originating from last week's failed OPEC+ alliance meeting sent oil prices plummeting as a price war broke out in Riyadh. Saudi Arabia has announced a massive price cut for their oil, while sources claim they plan to simultaneously increase production to more than 10,000,000 barrels per day with the possibility of exceeding 12,000,000 barrels on some days. This "Shock & Awe" tactic is a desperate attempt by the Saudi's to increase marketshare worldwide. In response, Russia has indicated they will also increase their production to maximum levels. And the price war has begun.
The last time a price war this serious broke out was during the first Gulf War in 1991. As of the opening bell this morning, the price of a barrel of oil dropped more than 30% ($27).
What does this mean for the west?
Quite possibly the end of the U.S. Shale market, for starters. With the price of oil below $30 a barrel, oil wells in West Texas are now operating at a loss.
Since 2014 the price of oil has been subject to wild volatility as the west became one of the largest exporters of shale oil in the world and price manipulation out of Saudi Arabia saw the price of oil drop from $100/barrel to less than $40. Despite a few brief periods of upswings, it still has not returned to normal levels and is showing no signs of recovery.
It is important to remind yourself that things will get better. Do not panic. Life will get better, the world will come to its senses and you just have to give it time.
Hang in there.
While it's possible to be frugal with many aspects of your lifestyle, there are certain events and possessions that will require you to spend a substantial amount of money. Thus, a wise course of action is to begin saving well ahead of time while thinking about your goals for the future. This way, you'll be able to maintain a stable financial state even when faced with those large expenses. The following are a few major life purchases that you should plan for.
Marriage is a joyous occasion that many people look forward to. However, a wedding can be quite expensive, often costing thousands of dollars. Your family and your future spouse's family will often contribute to covering this, but you should still prepare to spend a good deal of your own money on the ceremony. If you're in a serious relationship and are considering marriage, you should plan where the funds for the wedding will come from and take the necessary actions to accumulate them. It's also crucial to discuss financial matters with your partner, since your property will merge once you get married.
A New Car
Automobiles remain one of the top modes of transportation. As a result, you may want to purchase a new car at some point in your life. Although you may be fine with an old or used vehicle at present, you may one day be motivated by a desire to acquire something nice for yourself or by the practical needs that arise as you raise children. Whatever the case, obtaining a new car is a major life purchase that you should plan for.
In addition to setting aside funds to eventually put towards a vehicle, you should also aim to build you credit score. This is because your credit score will determine your available car loan options. The higher your credit score, the more you may be able to lower your interest rates on your car.
Owning your own residential property is a worthy objective that you may hope to make a reality one day. Ideally, you should save about 20 percent of the total cost of a house before you buy it. This will allow you to make a larger down payment and thereafter face less interest on your mortgage.
As with acquiring a car, the mortgage options that you'll have can change based on how strong your credit score is. You'll want to increase your score as much as possible in the years leading up to buying a house so that you can get more favorable interest rates. In addition to contemplating down payments and mortgages, you must also remember that you'll need to deal with property taxes, insurance, maintenance and repair fees, and sometimes homeowners' association charges.
It's also necessary to hire a real estate agent to help you with the buying process. There are different types of real estate professionals. You should know how to distinguish between buyer's agents and seller's agents so that you can obtain favorable prices on homes as well.
Many people live together before getting married and have begun the process of combining accounts and sharing responsibilities. However, some people wait to do this only after marriage, and others wait until they're married to live together. Whichever path you've chosen, it's still crucial to know a few tips to manage money together as newlyweds to determine where you should begin and how you can remain on the same page.
Discussing Money Motivations
As we begin to share money with our significant other, we soon find out what one person may rank as a priority regarding money and the other may not. As such, sitting down and discussing money motivations is important. Two people who cannot agree on how to handle money may cause serious issues. This should include:
- How to deal with money following payday. Is a percentage put into savings? Is that the day to splurge on dinner, drinks, and more?
- The frequency and size of payments made to debts. Some people like to pay minimums, whereas others pay in full or make double payments.
- What do you each consider money well spent? Is it a new 70" 4K television? Is it an investment? Is it paying as much debt off as possible?
- How do you go about consulting each other before making purchases over a certain amount?
Establishing Financial Goals
After you evaluate the motivations behind your money and how it should be spent, you'll need to spend time together hashing out financial goals. As newlyweds, there are certain things on your list that you're going to want to save for. How do you go about that? How much of each paycheck will you dedicate to a particular fund?
Some things in the future worth making a financial plan for include savings and paying down debts. This is the time to be honest about your current financial standing. If you're looking to buy a home, you'll want to assemble a first-time homeowner financial checklist to begin to develop topics of conversation. Some of the things to consider setting goals for are:
- Student loans
- Car loans
- Future children
- A house
- Medical bills
- Delinquencies on credit reports
- Vacation and rainy-day funds
- Emergency funds
The more honest and open you can be with each other about the money you have and now the debts you share, the better. Implementing plans for the best ways to have the things that you both desire while still taking care of existing demands is important. These can be uncomfortable things to talk about; however, these conversations are necessary.
Following these tips to manage money together as newlyweds will allow you to have a starting point for conversations that can be tough to start. The sooner you and your partner get on the same page with finances and the responsibilities that come with them, the easier the transition will be and the sooner you'll find success.
It's the dream: money you can count on to keep rolling in, even while you sleep.
Passive income isn't entirely passive, of course. You'll put in work up-front to get the profits rolling, so don't relax in your recliner just yet. But with so many potential sources of passive income available to you, picking one or several will mean that the day you can finally kick back will draw steadily closer.
Real estate is a tried-and-true wealth builder for a simple reason: people will always need somewhere to live. Research the market in a growing community until you know a good deal when you see it. You can maximize rent by fixing up a deteriorating property or upgrading a mediocre one. The key is to hire a property manager to do all the day-to-day landlord duties for you—and you'll need a good one. Smart investors put their profits in another property and repeat the process until they have a diverse portfolio.
A YouTube Channel
You can start a blog if you're more comfortable hiding behind a computer, but consumers are more likely to prefer video content. Post a series of “how-to" videos to answer questions about whatever you're an expert in.
You can put up any content you want, but if you don't want to commit to regularly updating it, focus on “evergreen" topics that will draw clicks for eternity. Ads will create your income, especially if your channel grows in popularity. Better yet, sign up for affiliate marketing. If you recommend a product and provide a link to buy it, you'll get a small percentage of those transactions.
If you don't mind vinyl-wrapping your car with an ad for a company, you can get cash just driving around and running your errands. Make sure you contact a reputable company that doesn't ask for any money from you; if they're the real deal, they'll evaluate your car, your driving habits, your area, and more. Bonus: the brighter the ad, the easier it'll be to find your vehicle in the parking lot.
What's something that people will pay for but doesn't require shipping on your part? Finding that item is what can supplement your income indefinitely. Write an e-book, charge for your cross-stitching patterns, design prints that people can digitally download, invent an app, record a “masterclass," or whatever else you want. Every time someone new discovers it, the cash register rings. With a little more effort, this is a potential source of passive income for you that can continue to grow. Once you build up a customer base, they might want more products. The good part is that it's up to you whether you wish to give it to them.