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Have you recently lost your job? Or changed job within the past 12 months?

If so, don’t let these events disrupt your life and personal finance. Here are some important financial issues that you need to consider now:

If you lost your job, do you have sufficient funds to last you until you land a new job?

Do you have emergency fund in savings account or money market fund to cover 6 months of your normal expenses? What other income sources are available to you? Also, don’t forget to set aside fund to cover your 2022 income tax liability.  

If you changed job, has your income changed substantially?

If so, review and adjust your budget, tax projection and savings goals. Also, consider how the change in income will impact your ability to reach your previously set financial goals.

Do you have health insurance coverage?

If you changed job, are you covered by your new employer’s health insurance coverage? If not, coordinate insurance coverage so that there are no gaps in your health coverage.

If you lost a job, explore all health care options available to you. Depending on your current age, or the employment outlook, you may use your old employer’s COBRA for a short period of time to stay covered if you can find another job quickly or are eligible for Medicare soon.

Does your new employer offer Health Savings Account (HSA)?

If you have an HSA with your former employer, weigh the pros and cons of transferring the money in your old HSA into your new employer’s HSA.

Does your new employer offer Flexible Spending Account (FSA)?

If, before you changed job, you have contributed to your FSA with your former employer, you can still contribute to your new employer’s FSA as each FSA has its own annual limit.

Did you have employer sponsored life insurance and/or disability insurance?

If so, your employer sponsored life insurance and/or disability insurance will not follow you to your new job. You need to find out if your new employer offer employment related life and disability insurance, and whether the insurance benefits meet your needs.

Do you have a 401(k) plan with your former employer?

If so, you will need to decide whether to leave the money in the existing plan or roll them over. You need to weigh the pros and cons of both options.

Do you have stock options and/or deferred compensation arrangement with your former employer?

If so, review your stock option and/or deferred compensation plan documents to understand their vesting, exercising and distributing rules.

What’s next?

If you just got laid off, what your next step would be? It depends on your age and job skill sets. If you are a young professional, your next step might be looking for a new job or starting your own business. If you are an older professional you may be thinking about retirement or start a consulting business. Weigh your options and think them through.

If you are not sure you are making the right decisions, enlist a trusted financial professional to help you sort through your options. The financial decisions you make now could determine your financial destiny and affect the rest of your life.

As you have probably read in the news that the financial markets worldwide are pretty volatile recently. The S&P 500 index has lost more than 18% of its value year to date. To investors who want to seek safe shelters in the bond market, the sad news is that you most likely have lost over 9% year-to-date if you invest in a typical inter-medium term U.S. bond fund. Then, you may wonder what caused the volatility and how to invest in such a volatile market?

There are some unique factors combined to contribute to the market losses for investors:

• Federal Reserve aggressively raising interest rates plus the reverse of its “QE” because of rising inflation in the U.S.
• Supply chain disruptions due to COVID-19 lock downs
• Rising commodity prices due to the uncertainties of the Russia – Ukraine War
• Potential slowdown of the growth of world economy

How to invest in such an economic environment? Let me tell you how we help our clients invest in this kind of market.

We use an investment process that we call goal-driven, life-stage based investing.  First of all, investing is highly personal. That is why we design individual investment policy for each of our clients. First, we help clients define and prioritize their goals. Then we help them divide their goals into two big categories: short-term or long-term. And then, we further categorize these goals into “needs”, “wants” and “wishes”.  After we really know our clients’ goals and situations, we build each client’s strategic investment portfolios for long-term success. We select investment products to match their goals and life-stage they are in currently, taking into consideration their risk capacity and risk tolerance. Every year, our firm conducts macroeconomic conditions analysis as part of our evidence-based, data-backed investment research to design tactical investment strategies for the current market conditions.

During times like what we have recently been experiencing, we communicate with our clients, review with them their financial plans and explain to them the market impact on their plans. Knowing that they have sound financial plans in place, our clients are more confident that they will be able to make decisions rooted in reasons, not emotions.