AUSTIN (KXAN) — The pandemic has us taking steps to protect our physical health, but what can you do to take care of your financial health as well?
Tom Miller talked with Austin financial expert Val Majewski, the vice president of sales and marketing at American Benefits Exchange, about the moves you should and shouldn’t be making right now.
Tom: A lot of people can expect to get their stimulus checks this week, when they get that money what should they do with it?
Val: If they’re out of work… hopefully they know what their priorities are, whether it’s living expenses or just daily needs. If they don’t necessarily need the money right away, perhaps putting it toward their savings or even toward an emergency savings fund for events like we’re going through now.
Tom: If you need money now, the government’s stimulus package allows you to take up to $100,000 out of your IRA. Is that a good idea?
Val: If it’s not in dire need, if it’s not something you absolutely need, I normally recommend against it, and just leave your retirement funds where they’re at, so that they can continue to do what they’ve been doing for your future. But if it is an absolute dire need, it’s something that you can take advantage of, and the government will let you pay the taxes off over time, and avoid the penalties that are normally associated with those types of accounts and early withdrawals.
Tom: A lot of people in the baby boomer generation are nearing retirement age. Is now an okay time to retire?
Val: If you’re panicking because you’re late in the game and maybe you still have a lot of money that was in the stock market and you’ve seen a drastic loss in the last couple months in the stock market or big fluctuations, then maybe you’re at too much risk this late in the game in your careers. But, if you’ve prepared all along this way, you’ve had a plan, you’ve talked to a financial professional and they’ve guided you properly, this should still be a good time to retire.
Tom: Moving forward there will be a day when this is behind us, what are some of the lessons going to be coming out of this for people and how they handle their finances?
Val: I think the big lesson will be a proper plan from start to finish, meaning it usually starts with an emergency fund, having enough money, people say three months or six months of income or expenses saved up and put aside for things like this, not to be touched until something like this happens.