Financial planning during normal times can be difficult enough. In crisis and times of uncertainty such as those we are now experiencing, it can become even more challenging. This applies both to individuals and families who have resources to weather the storm and those who struggle with greater odds and in ways they never did before.
For Americans who have been receiving an additional $600 weekly in unemployment compensation, that additional safety net ended July 31. Because of delays in processing, some recipients received their first unemployment checks later than expected or have not received them yet. The basic unemployment compensation benefit received through the State continues after July 31 but at a rate much less than salary, assuming there is a business employer to return to. Protection from eviction for renters ended at the same time as the unemployment compensation supplement since both of these provisions of the federal CARES Act expired at the same time. There may be federal legislation to replace them but, at the time of this writing, that has not happened yet. In a totally different area, tax law, major changes to the tax laws affecting withdrawals from retirement accounts, as just one example, add to confusion regarding which path to take.
One point is clear – the Covid-19 pandemic did not bear equally on individuals, families and businesses. Some, as in the technology sectors, actually grew and prospered. Some businesses obtained PPP loans with generous terms for forgiveness. Even there health concerns dramatically changed the way individuals and companies conducted business which added to anxiety and, in many cases, cost. Additionally, many Americans especially in the health care industries work under conditions where their health is at risk on a daily basis.
Business that were more critically injured include small businesses, retail, hospitality and restaurants that have had crushing losses from which some might never return. All of this has called for creative solutions, if possible, and definitely for planning where possible. The temptation is to freeze and not take action but there are some steps that can help.
The economy is trying to sort itself out and individuals, regardless of their circumstances, need to plan with what they have more than ever before.
Esquire, Colliton Law Associates, P.C. Janet Colliton has practiced law for over 38 years, 37 of them in Chester County, Pennsylvania, a suburb of Philadelphia. Her practice, Colliton Law Associates, PC, is limited to elder law, Medicaid, including advice, applications and appeals, and other benefits planning including Veterans benefits, life care and special needs planning, guardianships, retirement, and estate planning and administration.