What Covid Taught Us About Money

I’m a Wall Street Journal junkie. When I first subscribed, 25 years ago, I was totally intimidated. But I’d lay it on the kitchen counter and every day I’d pass by it figuring, by osmosis, I’d pick something up. I credit that ritual for greatly reducing my fear of investing.

The Journal is always filled with interesting and instructive articles. Last week, for example, I was riveted by the headline Personal Finance Lessons We Can All learn From a Pandemic Year.

“With 2020 in the rearview mirror,” the article began, “there’s a lot of economic damage to be assessed. But there are a lot of personal finance lessons we can learn—lessons that will put us in good stead whatever the economic future holds.”

There were 15 excellent lessons. Let me share my 5 favorites.

1. Emergencies Do Happen. 2020 showed us the importance of having an emergency fund of at least a month’s expenses, preferably more. Those who had adequate savings were spared from making painful cuts in spending or borrowing at high interest rates when facing temporary setbacks.

2. Buy When Others Are Scared. As Warren Buffet once said “Be fearful when others are greedy and greedy when others are fearful.” Though it’s definitely counterintuitive, buying when the market is falling increases your chances of earning above average returns when it bounces back.

3. Manage Your Risks. Everyone needs to ask themselves some difficult questions. Does my family have proper health care or disability coverage? Do we have enough to cover high deductibles? Do we have sufficient life insurance if the family income earners die?

4. Have A Three-Bucket Strategy. The 3 Bucket Plan includes: (1) a short-term bucket in cash to cover 1-2 years of expenses; (2) an intermediate bucket in core bond funds to cover 2-5 years of expenses; (3) a long-term bucket in equities for money not needed for at least 5 years.

5. Stay Invested. During the first quarter of 2020, stocks plunged. Investors panicked. Many jumped ship. Most thought a recovery was dependent on a vaccine. Yet by year’s end, stocks surged to record levels. The lesson: it’s pointless to try and predict the market. Instead, refer to lesson #2.

What financial lessons did you learn in 2020? Let me know in a comment below.

Comments & Feedback

  • Lisa

    I learned about taking advantage of down time during 2020.

    I used emergency funds to buy cheap stock, cleaned out all my closets and found things I didn’t know I owned and used them. Lost my job and got a better job! Got my wish to work at home more. Studied to become a sailor. Passed my boat license, became a member of a marina!

    I did the best I could during a shit time (pardon my French) and I’m grateful for not catching Covid19.

  • barbara

    Wow, Lisa, you accomplished so much and definitely made use of a very challenging time!!! I’m impressed.

    • Lisa

      Thanks, Barbara.

      When I was 18, my college professor taught me that there is a correlation between the wealthy and how they use their time. She drew a pie chart showing us how most people spend their time. For example, doing chores, watching TV, going to work.

  • Theresa Haenn

    I had been working from home and thankfully, my work got even busier. My husband was furloughed in the spring, which caused us to think hard about where we wanted to be – near our grandchildren, who lived in another state, or near our friends. Our grandchildren won out. Moving during a pandemic was not fun, pretty nerve-racking, actually, but ultimately worth it. Even our grandchildren are happy we are nearby, which makes me very happy. My husband is back at work and working from home, so our life is on track – very quiet though, until ….

  • Paula Zimmerman-Taylor

    I learned that I don’t spend money when I’m not out and about, and my sparse income covered the necessities. I learned that I’m still an impulse buyer, that I get emotional satisfaction from shopping and communicating with people while I’m there, that I had to withdraw from that! I learned that I could lose like 95% of my income and I didn’t die. And I do have optimism in the future, that my work will blossom once the pand is over. (I do Event work, so I’m sure there will be a lot of that). I learned that I am pretty self-sufficient and can keep myself amused and creative about 85% of the time. I learned to prioritize my goals and am trying to keep up with that. I learned that a pet is lifesaving in a pandemic!

    • barbara

      You’ve certainly gained a lot of insights into yourself and money during this pandemic, Paula. And I suspect you are so right…there will be a lot of work for you once this passes. Thank you so much for sharing your lessons!!!

  • Lisa


    I believe some wealthy people spend about 10 to 15 minutes a day researching an idea or making a phone call related to a new idea.

    Jeff Bessos, the second most wealthiest man in the world, tackles the most daunting task on his list first thing in the morning.

    A lot of wealthy people wake up really early in the morning or stay up really late.

    They outsource time consuming tasks / chores to someone else to spend time on what really matters and they’re selective about what type of people and media they let into their life. For example, Bill Gates would rather read a book instead of watching sensationalized news and he grew up writing computer programs instead of playing mindless computer games!

    • barbara

      Thanks for sharing that info, Lisa…so fascinating. I’m most inspired by Bezo’s tackling the most daunting task first…that makes so much sense…it inspires me to do the same!!!

  • Lisa

    Ahh, I meant Jeff Bezo from Amazon (spelling)

    Inspired by these ladies, too. I used the downtime to think about what really matters, as well and I stopped spending a lot of money on manicures and pedicures.

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Meet Barbara Huson

When a devastating financial crisis rocked her world, Barbara Huson knew she had to get smart about money… and she did. Now, she wants to empower every women to take charge of their money and take charge of their lives! She’s doing just that with her best-selling books, life changing retreats and private financial coaching.

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