The COVID-19 outbreak is a personal finance debacle for people who have lost their jobs or had their incomes cut. A recently retired reader asked what people like himself can do to help.
Many retirees are understandably nervous right now about how the stock market crash has affected their retirement savings. But some retirees are fortunate enough to have pensions, annuities and reliable dividend income. What can they and others who have the means do to help people in financial trouble?
Let’s crowd source some answers. What ideas do you have for people whose finances are solid to help out in their community? Send ideas to me at rcarrick@globeandmail.com and I will report back later. In the meantime, here are some thoughts to get the conversation started:
Donate to food banks: Food Banks Canada has issued a special appeal to raise money. Mass job losses mean more people will need the help of food banks, which face challenges in keeping their shelves stocks.
Support local business: Some business have closed their storefronts, but are still operational online.
Support local restaurants: Some restaurants are offering takeout, while others are selling gift certificates you can redeem for a meal when they re-open.
Support charities providing COVID-19 relief: CanadaHelps.org, an online charitable giving portal, can help you target your donations to healthcare, community and international efforts to battle the virus and its effects.
How can retirees and people of means do the most good right now? Let’s hear your ideas.
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Rob’s personal finance reading list…
If you need help paying your debts
A roundup of links to material posted by major banks, credit unions and mortgage lenders on how they will help clients in financial stress as a result of COVID-19. Here’s a broad list of resources available to people who need financial support as a result of the coronavirus outbreak.
If you need to apply for EI or emergency government aid
Canadians who have lost their jobs or cannot work because of the coronavirus outbreak could be eligible for support from the federal government. Here is a rundown of the available and soon-to-be-available programs and their requirements.
When FOMO is the right impulse
Fear of missing out has been used negatively to refer a tendency to spend in order to keep up with what others are doing. Here’s a reframing of FOMO as fear of missing out on a rebound in the stock market. Worth reading if you’re wavering on whether to sell.
What tax software programs do financial planners like?
Planners talk about the tax software programs they have found to work well. Good intel if you’re sensibly using software instead of paper and pencil. Remember, the tax filing deadline has been extended to June 1 as a result of the coronavirus. File sooner by all means if you’re expecting a refund.
How to turn a baked potato into dinner
How to keep dinners cheap and interesting during this time of social distancing – 20 ways to elevate baked potatoes into an entire dinner.
Ask Rob
Q: I’m curious how someone who has a portfolio managed by a roboadvisor has fared compared to a portfolio managed by a real person. Any data on this?
A: I just checked the website of Canada’s largest robo-adviser and returns for the month ended Feb. 28 are available. Wealthsimple’s growth portfolio was down 4.5 per cent for the month, while the balanced portfolio lost 2.2 per cent. The March results will be much more dramatic on the down side. As background, robo-advisers for the most part use blends of exchange-traded funds tracking well-followed indexes like the S&P/TSX composite, the S&P 500 and the FTSE Canada Universe Bond Index. We know that stocks have been pounded and bonds have been better, but still down a little or flat. Over the long term, most individual and pro investors have trouble matching index returns. Short-term, investors who old cash may outperform. The trick is to get that cash back into the market before it rebounds.
Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
Activities parents can use at home to teach their kids about money from the Canadian Federation for Economic Education.
In case you missed these Globe and Mail personal finance-related stories:
- Do you have a financial contingency plan? Worried Canadians are updating wills amid coronavirus pandemic
- If I’ve told a few white lies to my auto insurance company, can I get in trouble?
- Quality companies are going to survive this market turmoil. Here are the sectors and stocks to target (for Globe Unlimited subscribers)
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Rob Carrick