{"id":9183,"date":"2020-12-30T16:12:13","date_gmt":"2020-12-30T16:12:13","guid":{"rendered":"https:\/\/zackspcg.com\/blog\/?p=9183"},"modified":"2022-02-26T13:05:59","modified_gmt":"2022-02-26T13:05:59","slug":"3-financial-lessons-from-2020","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/3-financial-lessons-from-2020\/","title":{"rendered":"3 Financial Lessons from 2020"},"content":{"rendered":"\n

Christie A. from Raleigh,\nN.C. asks: <\/em>Hello Mitch, I hope you had a nice holiday and happy early new\nyear. I\u2019m curious if you have any financial lessons from 2020 you could share.\nTrying to get off to a strong start in the new year!<\/p>\n\n\n\n

Mitch\u2019s Response:<\/strong><\/p>\n\n\n\n

Thanks for writing Christie, and I also wish you a happy\nholiday season! <\/p>\n\n\n\n

2020 was a pretty lousy year for many people in many\ndifferent ways, but hopefully you were able to find some silver linings along\nthe way. Most of the obvious silver linings come from realizations about\nhealth, family connections, and aspects of life that are most important to you.\nI would argue that financial well-being should be near the top of this list,\ntoo, and I\u2019m glad you\u2019re thinking about it as the year turns. I have three\nlessons I\u2019ll share with you. <\/p>\n\n\n\n

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Preparing for a Bright Financial Future in 2021!<\/a><\/strong><\/p>\n\n\n\n

Goodbye 2020, hello 2021! This year was filled\nwith unexpected events that may have played a part in your investing decisions.\nKnowing that the current pandemic completely shifted the market this year, what\ncan we expect in the market next year? <\/p>\n\n\n\n

Reflecting on the year will give you a better idea of the\nright choices to make when preparing for your financial future in 2021.\nWe are giving you a look at 2020\u2019s most important developments to guide you in\nmaking your future decisions!
\n 
\nIf you have $500,000 or more to invest, download\nour free guide, 2020 in Review: An Uncertain Year with a Clear\nInvestment Takeaway<\/em>. This guide gives you a detailed look at\nthe most significant events of the year, with analysis of the potential effects\nof these developments in 2021. <\/p>\n\n\n\n

Download Your Free Copy \u2013\u00a0<\/a>2020 in Review: An Uncertain Year with a Clear Investment Takeaway<\/a>1<\/a><\/sup><\/em><\/strong><\/p>\n\n\n\n

______________________________________________________________________________<\/p>\n\n\n\n

Lesson 1:<\/strong> The first lesson is remembering the\ncritical value of maintaining an emergency reserve fund. Millions of Americans\nlost work this year, which tested financial well-being across many households. <\/p>\n\n\n\n

But there are also retirees who use their retirement\naccounts and investment portfolios for cash flow, which meant potentially\nhaving to raise cash during a bear market. With an emergency reserve fund \u2013\nwhich I usually like to see as one year\u2019s worth of income replacement \u2013 working\nhouseholds and retirees could have significantly softened the impact of a\ntumultuous year that included a deep recession and bear market. In 2021, if you\ndo not have emergency reserves, or you need to replenish yours, I think this\nshould be a high priority. <\/p>\n\n\n\n

Lesson 2:<\/strong> The second lesson is remembering one of the\nmost critical lessons of investing: keep\nyour emotions separated from investment decision-making. <\/em>2020 was a lot of\nthings, but it was certainly filled with emotions about health, politics, safety,\neconomic opportunity, to name a few! All of these swirling emotions were paired\nwith a steep bear market \u2013 where the S&P 500 plummeted over -30% in just\nover a month \u2013 and a recession that we\u2019re still clawing our way out of. Yet\nfrom an investment perspective, one of the smartest decisions an investor could\nhave made in 2020, in my view, is keeping a steady hand and staying invested in\naccordance with long-term goals. <\/p>\n\n\n\n

Lesson 3:<\/strong> The third and final lesson is to take some\ntime to think about your estate plan. Many lives were lost in this pandemic,\nand our hearts go out to families most affected this year. I think the\nhardships of the year should remind us of the importance of putting an estate\nplan in place, so you can protect the assets you\u2019ve worked hard to accumulate\nover your lifetime. Start with the basics \u2013 making sure you have an updated\nwill and that beneficiaries on your accounts are up to date. More detailed\nplanning may include exploring trusts for your assets, so you can better\ncontrol how they are distributed after your death. Healthcare planning is\nimportant, too. <\/p>\n\n\n\n

Overall, I think the key takeaways after a challenging year\nare to look for ways to make financial planning more of a priority, with the\nabove three lessons offering what I think is a great place to start.<\/p>\n\n\n\n

2020 has truly been a historic year. From the effects of the\npandemic to the latest presidential election, numerous events occurred that\nresulted in market volatility. As we enter 2021, there is no way investors can\npredict where the market is headed. Reflecting on this year will give you a\nbetter idea of the right decisions to make when preparing for your financial\nfuture in 2021.<\/p>\n\n\n\n

If you have $500,000 or more to invest, download our free\nguide, 2020 in Review: An Uncertain Year with a Clear Investment Takeaway.\u201d<\/em>2\n<\/sup>This guide gives you a detailed look at the most significant events of\nthe year, with analysis of the potential effects of these developments in 2021.\n<\/p>\n","protected":false},"excerpt":{"rendered":"

Mitch shares 3 financial lessons that all investors can take away from a chaotic year<\/p>\n","protected":false},"author":3,"featured_media":7436,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66,71],"tags":[],"class_list":["post-9183","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mitchs-mailbox","category-private-client-group"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9183","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=9183"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9183\/revisions"}],"predecessor-version":[{"id":10484,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/9183\/revisions\/10484"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=9183"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=9183"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=9183"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}