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One year ago, Megan Strobel and her family were gearing up for a busy season of quarter midget car racing with her daughter, 6. The Langley, B.C., family was busy prepping the child-size race car, purchasing a hauler to drive the equipment and vehicle to various races around the United States.

The price tag for this pastime, which doubles as the family’s summer vacation, is thousands of dollars. “It’s an expensive program,” she says.

Now, the hauler sits idle and Ms. Strobel is facing a racing season sitting at home. The money they saved for gas, vehicle repairs and parts, hotels, entry fees and restaurant meals, is in the bank. That’s money the family might need as Canada’s economy and job landscape worsens in the months ahead.

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Ms. Strobel is not too worried about the coming months despite her husband, the family breadwinner, having temporarily stopped work. He is a contractor who can pick up at a moment’s notice, she says, and the family has considerable savings.

Since COVID-19 hit Canada full-force in March, many Canadians have seen their work hours cut or been forced to stop working entirely. According to a March survey from the Angus Reid Institute, 44 per cent said they or someone in their household has lost work because of the economic downturn.

But in more fortunate households, people are still working. Many of them are isolating at home, which means they are not buying gasoline to drive to work, not eating out, not paying for their children’s sports activities and not travelling.

Households like the Strobels’ are finding that they unexpectedly saved money in March and are now wondering what best to do with those savings, given that the months ahead are paved with uncertainty.

Financial planners agree that setting aside money in an emergency fund is a top priority. The standard recommendation has been for households to set aside enough liquid cash to cover three months’ worth of living expenses.

But "a global crisis like this isn’t going to resolve itself quickly, and so I would recommend aiming to build up at least a minimum of six months’ worth of household expenses,” says Cindy Marques, a Toronto-based certified financial planner.

She suggests keeping those funds in a high-interest savings account “so that you still get the potential for some growth while avoiding all risk of potential losses.”

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If you’re in good shape, employed and with a solid emergency fund, tackle your debt. “By paying off debt, you’re earning an immediate rate of return – 20 per cent in the case of a credit card,” says Morgan Ulmer, a certified financial planner with Caring for Clients in Calgary.

Experts agree that credit card debt has some of the highest rates attached to it and should be paid off as soon as possible. All of Canada’s big banks have said they will temporarily lower credit card rates from around 20 per cent to about 11 per cent for customers who have been approved to skip mortgage payments because of COVID-19.

For people lucky enough to have jobs, plenty of savings, no debt and an appetite for risk, there are steep discounts in the stock market right now, Ms. Marques says.

Because stocks are so inexpensive right now, “the rebound potential is huge once the economy begins to stabilize again,” she says. Sheltering that growth in a tax-free savings account can reduce tax bills down the road. She says that TFSAs can be great homes for money that has a medium-term (three to nine years) to long-term (10-plus years) timeline on it. “We need to give the market time to correct itself, which won’t happen overnight,” she says.

Overall, the uncertainty of what the months ahead may hold should guide any investment decisions, Ms. Ulmer says. “It’s tempting to invest now while markets are depressed so you can enjoy big returns when the market recovers,” she says. “But that investing opportunity may not serve you well if you don’t have a job in two weeks, six months or 12 months.”

“In those cases, cash is king,” she says.

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With unemployment skyrocketing during the coronavirus pandemic, personal finance columnist Rob Carrick offers some tips on how to deal with creditors and make a bare-bones budget. The Globe and Mail

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