How to make a financial plan when the pandemic has made planning seem impossible

How to make a financial plan when the pandemic has made planning seem impossible

Making plans can seem daunting in times of uncertainty, but the fundamentals of a robust long-term financial strategy are, in fact, remarkably similar to those you would expect in calmer, more normal periods. During uncertain times, there is a potential to make emotion-based decisions, which can affect long-term financial outcomes.

However, if you had a solid financial plan already in place, the chances are your goals — or what you’re ultimately saving for — should not have changed dramatically. And knowing you have a plan in place can offer valuable reassurance, helping you navigate these challenging times.

1. Reassess your situation

It can be hard to know where to start, so start with what you know. The pandemic has impacted people’s situations in different ways. Some families have had someone lose their job or face redundancy, while others have taken salary cuts. But others have benefited from lower childcare costs and less — or no — commuting. Having assessed your situation, it makes sense to go back to basics and determine what your monthly household budget is. This could affect how much you want to save in your emergency fund or contribute to your retirement.

2. Re-evaluate priorities

While your bigger, long-term financial goals may not have changed, the pandemic may have reordered your immediate priorities. Altering your plans due to circumstances outside your control is something that often happens during uncertain times. Think about your core priorities in the short-term, whether those include saving for a house, college expenses, continuing to build up retirement savings or saving for the trip of a lifetime once the pandemic is over. Let this help guide your decision-making and whichever goal is most important to you, prioritize saving up for it.

3.  Make sure you have an emergency fund

If the past year has taught us one thing, it’s that you can’t overestimate the importance of having 3-6 months’ worth of savings for emergencies or unexpected events. Given the unknowns around how much longer the pandemic will continue, aim to boost these funds to cover up to 9 months (or even a year) of your expenses, if possible. That extra cushion can provide a valuable safety net.

4. Consider continuing to invest

While economic downturns may be inevitable, if you have a good financial plan, you will have already taken these unexpected events into consideration. The key to riding them out is to take the long-term view and stay focused on your financial goals. Stocks can be volatile in the short term, but in the past the market has tended to bounce back from declines, even if the recoveries took some time.1 Sticking to their plans has been a hallmark of successful long-term investors and following their lead makes sense to consider despite the current uncertainty.

5.  Pay off loans

With interest rates still near record lows and not anticipated to rise anytime soon,2 it may be a good time to consider paying off debt where you can. Low interest rates can also be good news if you have a mortgage — refinancing can save you thousands or you can shorten the term of your loan to pay it off faster and, again, save more money. If you are saving money in other areas — such as not commuting or going on vacation — this may provide another opportunity to eliminate or reduce debt.

6. Get your affairs in order

Part of planning for uncertainty is planning for anything that could happen to you, so make sure you have certain estate planning documents completed. First, a will, which ensures your money and other possessions will be passed down according to your wishes. Then, identify an executor who will control your assets throughout the process, pay final expenses and debts, and file any estate tax returns. And, finally, looking into options for long-term care can give you peace of mind you are able to cover the cost of aging in the comfort of your own home.

7. Talk to a financial professional

When reviewing your financial plan, it’s important not to let emotions rule your decision making and to remember what you’re working toward longer-term. Although it’s natural to feel a little uncertain about what the future holds, goal-based investing will help you prioritize and stay pragmatic, instead of being reactive. And during times like these, a financial professional can provide guidance in maintaining a clear focus on what’s most important to you and help you as you consider ways toward achieving your goals. 

1 Past performance does not guarantee future performance or investment results.


This informational and educational content does not offer or constitute financial, investment, legal, tax, or mortgage finance advice.  Your unique needs, goals and circumstances require the individualized attention of your own financial, legal, tax and other professionals. Equitable Financial Life Insurance Company and its affiliates do not provide tax, legal, or mortgage advice or services.


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