Updated: 3/13/2020 7:40 pm

The same precautions we should take to protect ourselves from colds and seasonal influenza will also help reduce our risk of contracting the novel coronavirus disease (COVID-19).

Wash Your Hands

Soap works better than alcohol and disinfectants at destroying the structure of viruses.

Hand washing is critical in slowing the spread of respiratory viruses and other bugs, and it’s one of several measures the Centers for Disease Control and Prevention recommends for reducing your risk of COVID-19, influenza, and more.

And CDC recommends washing your hands often with soap and water for at least 20 seconds, especially after going to the bathroom, before eating, and after blowing your nose, coughing, or sneezing. Soap works better than alcohol and disinfectants at destroying the structure of viruses.

Soap dissolves the fat membrane, and the virus falls apart like a house of cards and “dies,” or rather, it becomes inactive as viruses aren’t really alive. Viruses can be active outside the body for hours, even days.

But, if soap and water aren’t available at the moment, use an alcohol-based hand sanitizer that’s at least 6-percent alcohol. That’s a good practice year round.

In your home, it’s a good idea to regularly clean frequently touched surfaces, like doorknobs, handles, and counters.

Disinfectants, or liquids, wipes, gels and creams containing alcohol are not as good as regular soap. Apart from alcohol and soap, antibacterial agents in those products don’t affect the virus structure much. Consequently, many antibacterial products are basically just an expensive version of soap in how they act on viruses.

Soap is the best, but alcohol wipes are good when soap is not practical or handy, for example in office reception areas.

Importance of Social Distancing

Early data suggests that older people, and those with underlying chronic medical conditions such as heart disease, diabetes and lung disease might be at risk for more serious complications from the virus. It’s most important for people at high risk of getting seriously ill from COVID-19—including older adults and those with underlying health conditions—to begin taking social distancing measures.

The logic behind social distancing rests on two key scientific facts about the virus.

• First, scientists say that its spread requires close contact—being directly coughed on or sneezed at by someone with the disease, or by being within 6 feet of an infected person for about 10 to 15 minutes or more.
• Second, the virus can survive on surfaces for hours or even days. 

The key to avoiding the disease is keeping a safe distance from sick people, from people with flu-like symptoms such as fever, cough and shortness of breath, and try to not touch surfaces that may have the virus on them. It also means washing your hands carefully, so you don’t transfer virus to your mouth, nose, or eyes, where it can enter your system.

Stop Buying Masks

The Centers for Disease Control and Prevention doesn’t recommend face masks for those who are well; they should be used by people who show symptoms of coronavirus to help prevent the spread of the disease to others.

Face masks aren’t an effective way to prevent the illness for most healthy people, according to the CDC and the World Health Organization. That includes plain, loose-fitting masks sometimes called surgical masks; tighter-fitting N95 respirators, which filter out 95 percent of airborne particles; and reusable face masks sometimes advertised as dust masks.  

Any benefit healthy people may get from wearing a mask is likely modest. In fact, if you’re not sick or taking care of people who are, wearing a mask comes with downsides. Both surgical masks and N95 respirators are only meant to be used once and then thrown away. But consumers may be tempted to reuse them, possibly spreading the virus to other surfaces or items.

Sources:

1. https://www.consumerreports.org/coronavirus/stay-safe-from-coronavirus-while-on-the-go/?EXTKEY=YSOCIAL_FB
2. https://www.consumerreports.org/coronavirus/how-to-protect-yourself-from-coronavirus/
3. https://www.consumerreports.org/coronavirus/do-you-need-a-mask-to-prevent-coronavirus/

“Habits are the compound interest of self improvement. You are what you repeat”. James Clear

Not too many months ago, I accepted an invitation to attend a Financial Education Conference hosted by TD Ameritrade in Las Vegas, Nevada.  The conference focused on teaching the assembled retail stock, bond, options and future traders how to make better investment and trading decisions to meet their short, intermediate and long term financial goals.

The weekend events at the MGM Grand in Las Vegas brought together retail and professional traders of varying levels of experience and skills with financial industry employees from TD Ameritrade and several other financial companies.

How can you get one percent better today. 

One of the conference’s highlights was the keynote address delivered by James Clear, author of Atomic Habits. His keynote focused on the major points of his book about how to build good habits and break bad habits.

He discussed how winners and losers often have same goals. The difference is that winners have a better system of habits.  Unsuccessful individuals have the wrong system that prevents positive change. Essentially, people do not rise to goals but fall to the level of your system. 

The power of tiny gains | Why habits are so important.

“Small habits and tiny gains multiply into meaningful results very quickly.” James Clear 

The core philosophy of Atomic Habits is that small habits and changes compound over time will make a big difference over ten, twenty or thirty years. For example, the same way that money can accumulate through ‘magic of compound interest’, you’ll have the effects of your habits multiply over time. And it ends up generating sort of a non-linear effect.

He conveyed that this is true for both good and bad habits. This effect of 1% improvements or 1% declines can either work for you or against you. And you see this in, for example, knowledge and productivity compound. So on any given day, getting one additional task done at work doesn’t really count for a whole lot. But over the course of a career, that can end up being a really big difference between what you get done over your career and how

Small habits and little choices, slightly better, can transform us everyday. Make time work for you instead of against you Good habits make time your ally. Bad habits make time your enemy.

Change can habit plank by plank, habit by habit. The actions you take give evidence to whom you are. Every action is a vote for the type of person you wish to become.

Lasting change comes from the compound effect of hundreds of tiny decisions – doing two push-ups a day, waking up five minutes early, or holding a single short phone call. He calls them atomic habits.

In Atomic Habits, Clear showed us how we too turn minuscule shifts in behavour into life-transforming outcomes. The core philosophy here is that small changes compound over time. So the same way that money can accumulate through compound interest, you’ll have the effects of your habits multiply over time. And it ends up generating sort of a non-linear exponential effect.

Focus on systems rather than goals

“The purpose of setting goals is to win the game. The purpose of  building systems is to continue playing the game. True long-term thinking is goal-less thinking. It’s not about any single accomplishment. It is about the cycle of endless refinement and continuous improvement.”  James Clear

According to James, the systems is what makes the difference. The system, or habit, is the process that takes you to your goal or destination. On average, it takes sixty-six days to instill a new habit or system.

Will power is like a muscle, the more you use it…the more your power will fade and get fatigue.

Focus on building the system of behaviors first before focusing on the goals and objectives. Goals are important. Important to know were you’re going and where your headed.

1. Start with a habit or routine that is incredibly easy
2. Gradually increase the intensity or scope of the habit in a very small way
3. Keep it easy and simple. Break the habit down into small bites, if needed. It in important to reduce the amounts of friction points.

David Kostin, Goldman’s top U.S. equity strategist, warned that the post 2008 financial crisis S&P 500 Bull Market will end soon.

“After eleven years, 13% annualized earnings growth and sixteen percent (16%) annualized through-to-peak appreciation, we believe the S&P 500 bull market will end soon.” Goldman-Sachs

Furthermore, Kostin expects that the S&P 500 index goes down 15% by mid-year and recovers by year end. He believes what prompts the market decline is corporate earnings recession and a wave of negative earnings revisions that are likely over the next three to six months. He projected that the S&P 500 target will be at 2,450 by mid-year.

Sources:

1. https://www.cnbc.com/2020/03/11/goldman-sachs-the-bull-market-will-end-with-stocks-down-another-15percent.html

One key way to improve your retirement prospects: Make it a point to save, invest and accumulate wealth as much as possible and to start early.

Although financial security in retirement for women have improved, new research from the Aegon Center for Longevity and Retirement report that women around the world share the same three career and financial challenges: a gender pay gap, time away from their careers, often due to caregiving responsibilities, and a lack of compensation for those responsibilities.

Despite the fact that women today are better educated and enjoy more career opportunities than any other time in history, even now, many struggle to achieve a financially secure retirement. As a result, it is imperative that women (and men) take greater control over their financial situation, retirement planning and long-term financial security. Women need to further engage in saving, investing, and preparing for long and healthy lives and secure retirements.

Aegon Center for Longevity and Retirement developed what they view as the “five fundamentals” for retirement readiness. The five fundamentals comprise: saving (starting early and saving habitually); planning (developing a retirement strategy); creating a backup plan for unforeseen events; upholding a healthy lifestyle; and embracing lifelong learning.

Overriding purpose of the key findings is to help men and women achieve a lifetime of financial security, both during their working years and through retirement. Important steps to take, according to Aegon’s report, include:

• Start saving, investing and accumulating wealth early and habitually. If offered a retirement plan at work, enroll in the plan. Admittedly, there are times in our lives when we can put away more money, and other times when it’s less. Yet, just the process of developing the habit of saving, investing and accumulating wealth can make a big difference.
• Develop a written financial strategy and plan. Create a plan that includes everything from goals you want to achieve to how you will reach those gaols. The plan should also factor in future healthcare expenses. It’s impossible to chart a course if you don’t have a destination in mind.
• Create a backup financial plan for unforeseen events. Consider emergency savings and insurance products such as disability insurance. Life will probably throw you some curve balls, so be ready to adjust your plans. Especially, if you plan to work longer and retire at an older age.
• Maintain a healthy habits and lifestyle. Make eating healthily, exercising regularly, avoiding stress and getting enough sleep part of their routine. Your health is key to enjoying your time in retirement. And yet, not enough people are paying attention now to their diet, exercise and sleep. By focusing on healthy habits now, you can keep health issues at bay later.
• Embrace lifelong learning and emotional wellness. Keeping your job skills up to date will help protect your income by keeping you employable. Keeping your social life active and engaged with friends and others will help create a more fulfilling life. And it’s also important not to neglect the basics of financial education and planning, and your social connections. You can make smart decisions with your money and smart choices with your emotional health.

Amid widespread concerns about the financial sustainability of social security and retirement systems, it is imperative that women (and men) take greater control over their financial security and retirement planning.

People need to engage in saving, investing, accumulating wealth and preparing for long, healthy and emotionally engaging lives and secure retirements.

References:

1. https://www.cnbc.com/2020/02/21/womens-retirement-prospects-are-improving-but-not-enough.html
2. https://www.aegon.com/research/

• Crude prices falling
• Coronavirus fears and near hysteria
• Bond market turmoil

Saudi Arabia’s decision over the weekend to instigate a crude oil price war as it escalates a clash with Russia sent oil prices down by the most since the Gulf War in January 1991 and caused the U.S. stock market to experience it single worst day sell off in nearly decade. Crude prices, along with U.S. government bond yields, are typically viewed as key barometers of economic health and confidence. Today, we may be witnessing the end of the longest running bull market in history.

The price war between major oil producers–Saudi Arabia and Russia–is riling global markets and economies at a time when economists and investors are struggling to understand how deeply the coronavirus outbreak will impact global supply chains and consumer spending. Coronavirus is an illness that has infected more than 100,000 worldwide — including more than 650 confirmed cases in the United States — and killed more than 3,000.

There is an assumption that when oil prices collapse, whether the collapse is driven by the demand side or supply side, the global economy is going to suffer. The latest tensions put the oil market in somewhat uncharted territory with pressure in terms of both supply and demand as the coronavirus epidemic threatens to sap businesses’ appetite for energy.

The plunge in crude added turmoil in equity and credit markets as investors have grown increasingly concerned about economic growth stalling. It also raised fresh concerns about the risks tied to heavily indebted energy companies in the high-yield market, and the fallout for other companies if broader credit markets tighten.

The service industry is getting hit the hardest and driving the economy into a recession as a result of the coronavirus. There is a destruction of demand in area of travel especially with the airlines and cruise lines, with entertainment such as restaurants and with sporting events.

Essentially, time like these of panic selling by the herd are not the time to sell stocks. Things are so uncertain regarding the coronavirus and even the experts appear uncertain on what will happen with the the virus. One day, uncertainty will wane and the markets will recover. You do not want to be the investor who locked in their losses at these levels.

https://www.bloomberg.com/news/articles/2020-03-08/yen-slides-as-oil-price-war-adds-to-global-worries-markets-wrap

Shifting investment strategies during or in anticipation of market movements is often counterproductive.

March 3, 2020

Featured, Roger Young, CFP®, Senior Financial Planner

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Highlights

• Reacting to where you think the market is headed may compromise long-term returns.
• Stocks respond to numerous forces, making timing the market a complicated and risky proposition.
• Keeping a long-term perspective can help you meet your investment goals.

Instead of staying focused on the fundamentals of a long-term strategy—including portfolio rebalancing and modest tactical adjustments—some investors let emotions drive their decisions. Doing so makes no more sense when times are good than when times are bad. “Attempting to time the market and avoid a downturn by making dramatic changes in your asset allocation can cause harm to your long-term investment results,” says Roger Young, CFP®, a senior financial planner with T. Rowe Price. “This is because you have to accurately make two decisions that are likely to trip you up: when to get out of stocks and when to get back in.”

Read more: https://www.troweprice.com/personal-investing/planning-and-research/t-rowe-price-insights/retirement-and-planning/personal-finance/case-for-staying-invested-through-volatile-markets.html.html

Key Takeaways

A typical emergency fund target covers three to six months of expenses 

Keep an emergency fund separate from long-term investments

Include emergency savings as part of your budgeting process

Save for emergencies.

To keep from dipping into long-term investments or borrowing at unattractive rates when you need cash in a hurry, create an emergency savings fund that can cover at least three months of essential living expenses such as rent or mortgage, utilities, food, and transportation.

An emergency fund isn’t just a repository of cash you can dip into when the tires wear out or the dishwasher breaks down. Those emergency dollars may actually be critical to your overall investing strategy. The general rule for emergency savings is three to six months’ worth of expenses.

It depends on personal lifestyle, career, and income. If income is a little more stable, maybe they can stick to something shorter. But if the situation is unstable or if they’re in a profession where maybe there’s risk of attrition, then they may want to have a longer type of fund set up.

the availability of emergency cash is the key short-term priority, because without it, longer-term goals could get dinged.

Financial experts advise to put financial goals into short-term, intermediate-term, and long-term buckets. The short-term budget would include emergency savings. Intermediate goals may include buying a house and paying for college. But, the Long-term goal is retirement. But intermediate and longer-term buckets can spring a leak if emergencies aren’t covered by short-term funds.

References: