Employment Law Today - June 1, 2021
I was recently a guest on Employment Law Today with Eric Sarver. Eric is an employment attorney, networking colleague, and friend who was kind enough to invite me to talk about COVID-19 and how it has impacted financial planning.
A main topic of discussion was emergency funds. One of the biggest shifts I have seen through the pandemic is that the clients and prospects want more of a cash “buffer.” Typically this is because they experienced some kind of reduction or complete loss of income during the past 18 months. I am writing more in-depth about emergency funds at a later date so do not want to go into too much detail. However, the rule of thumb that is taught by the CFP Board is that your emergency fund should be equal to 3-6 months of fixed expenses. Personally, I think that is not enough and you should have at least 3-6 months of total expenses. This is all dependant on your situation (i.e. single vs. married, employee vs. firm owner, etc.) and what makes you feel more secure. Are you more comfortable having a specific amount (e.g. $25,000) or the equivalent of 7 months of expenses or maybe 12 months expenses? Again, it is all specific to you.
The other main topic of our discussion was cash flow. Most of us have been couped up at home since April 2020 which in theory means we’ve been able to save money from not going out for meals or entertainment. Now in actuality, that may not be true as there are a large number of us who spent more money than usual during the pandemic. Whether that was buying a new couch or bed, needing additional child care, or even renting an apartment in the building next door so you and your wife have a space to work without your two young sons always knocking on the door asking for Mommy and Daddy (this would be me). Going back to the office, even part-time, is a change to your cash flow. Be mindful of how your expenses will differ and adjust your spending accordingly.
You can watch the full video below and here is the breakdown of the episode with topics and times:
0:00 – 0:38 – Intro music
0:39 – 1:31 – Eric’s introduction
1:32 – 2:22 – Explanation of the episode’s topic
2:23 – 3:51 – Eric introduces me
3:52 – 4:21 – My search for the perfect grilled cheese sandwich
4:22 – 7:29 – My career journey and founding Haystack Financial Planning
7:30 – 14:00 – How has COVID-19 changed clients’ financial planning
14:01 – 16:51 – Commerical break
16:52 – 23:04 – The changing workforce models post COVID-19 and the impact on your personal budget
23:05 – 29:21 – The changing workforce models post COVID-19 and the impact on employers’ bottom line
29:22 – 32:32 – Commercial break
32:33 – 37:18 – Managing cashflow as a firm owner through COVID-19
37:19 – 42:03 – How I got started working with the disabled and special needs community
42:04 – 46:51 – The changing workforce models post COVID-19 and the impact on the disabled community
46:52 – 49:24 – Commercial break
49:25 – 54:36 – Where my clients are located and how financial planning may change based on clients’ location
54:37 – 56:07 – Wrap up and where you can reach me
56:08 – 56:52 – Eric’s sign off
56:53 – 57:08 – Outro music