Ep 37: Patience, Prudence, and Planning: The Three Ps to Managing Your Finances in a Pandemic

Financial planning can seem intimidating at any time, but especially during the stress and uncertainty of a global pandemic. In this podcast, Sarina Fazan talks with David Duquette, a local financial advisor with Park Avenue Securities, a financial representative with Guardian, and the founder of Impact Medical Advisors, about the practical steps you can take to better manage your finances now and to start planning for the future.

David’s role as a financial planner is to guide his clients through the decisions and unique circumstances that they face – and certainly, no one could have foreseen the COVID crisis. But he says that it is never too late to contact a financial planner for assistance. Whether you are just starting your career or are managing your retirement, it’s always a good time to ask a professional for quality advice.

David believes that, if you are proactive with your financial situation, then you’ll be in a better position to deal with emergency situations like this pandemic. “I think what we need to focus on and what should have been preached by all of the professionals in my industry was how do we create the appropriate emergency funds. How do we teach people to control their amount of savings, because that’s the controllable that will create success,” he states.

David sees many people are living paycheck to paycheck, at all levels of income, which he attributes to a lack of prioritization where the money goes. However, he claims that budgeting more is not necessarily the solution.

David explains, “I equate it to fad diets…Look at some the diets out there that say never eat bread again. The reality is people may do that for three months, people may do that for six months, and then you go to a great Italian restaurant, and what, you’re not going to eat the pasta or the bread? Most people are going to break, and the second they break it’s just that downward spiral. And, it’s the same with cash flow.”

Instead, David suggests that we need to focus on how to create lasting habits and systematic approaches for cash flow and financial management. His advice is to save 20 percent of your income and maintain liquidity of the majority of that savings, so it can be accessed in the case of an emergency.

As a general rule, David recommends that his clients develop an emergency fund, holding at least six months of expenses per person in the household. Business owners should save six months of personal expenses and six months of business expenses.

“Six months is a good starting point for expenses. If you cannot work for six months, imagine having a fund that you could live off of, feed your family, and pay all the bills…that should give a lot of peace of mind to people,” David explains.

Your emergency fund should be held in accounts that are not meant to grow, like a simple savings or money market account. Other assets can still be liquid but be invested in growth opportunities.

But what if you do not have emergency funds? David advises that this is the time that you should save any money coming in, putting the repayment of debt on the back burner. David also proposes that you contact the financial institutions that manage your mortgage, credit cards, and/or student loans to see if they have any offers to help you.

David says that it’s his job to remove the emotions from financial decision-making to help his clients find the best plan for them. He explains, “There’s a difference between what the math tells us to do and our emotional state…So, most of my job is not math. People think it is, just rates of return and other things. Most of my job is psychological in nature, figuring out how people react with their money.”

Financial planners can do a deep analysis of your specific situation and provide guidance to help you create a better future for your family.  If you are interested in learning more about financial planning, visit David’s website at www.ImpactMedicalAdvisors.com. You can also send your questions to Sarina at sarina@sarinafazan.tv for our next podcast with David!

Listen, Watch, Review, and Share With A Friend! For more discussions like this one, make sure to subscribe to the podcast “On The Record With Sarina Fazan”.