Updated: Feb 3, 2021
Lazetta shares her financial lesson learned with the Wall Street Journal
With 2020 in the rearview mirror, and the end of the pandemic (fingers crossed) in sight, there’s a lot of economic damage to be assessed. But there are also a lot of personal finance lessons we can learn—lessons that will put us in good stead, whatever the economic future holds.
Lessons about the importance of emergency funds and having different income streams. Lessons about how this time really isn’t different (no matter how much it feels different). Lessons about how personal finance is truly personal. And much more.
These are some of the lessons we heard about when we asked financial advisers and others to reflect on the past year. It was a year, no doubt, that many people would prefer to forget. But before we try to wipe those memories clean, here are some of the things that investors, savers and spenders would do well to remember.
We can be financially disciplined
The pandemic has taught us that financial discipline is possible. The restrictions on life’s pleasures, like travel and eating, caused all of us to rethink how much we spend on these activities. We reflected on our excess indulges and realized the value of spending moderately and saving intentionally.
Building cash reserves from unspent money on niceties sparked greater confidence in handling life’s shocks. Many of us appreciated the extra money to weather job loss, reduced income due to cutbacks or caregiving responsibilities, and mounting medical bills.
We also start thinking more about how we should spend our money, whether it was
because of sheer boredom or a greater appreciation of life in the midst of constant Covid-related casualties. Life’s experiences often serve as the catalyst for changing financial habits and mind-sets.
—Lazetta Rainey Braxton, co-CEO of 2050 Wealth Partners, New York