Adaptability: the underrated skill for living a bigger financial life

Adaptability: the underrated skill for living a bigger financial life

Reflecting on surviving COVID-19 so far

It's August 2021 in Australia and we’re in the middle of learning to live in a global COVID-19 pandemic.

How are you doing today?

Read in this article:

It's very clear nobody's COVID-19 pandemic experiences have been exactly alike.

Whether you find yourself working remote in a bedroom, a kitchen (or wherever the Wi-Fi signal was best), or locked down (again).

• Perhaps you're watching government health orders slowly creep across the nation or needing to deal with terrible loses being experienced by extended family members living overseas in less stable environments - nobody's COVID 19 pandemic experiences have been exactly alike.
• Small business owners still have to manage their commercial lives that affect their family lives, and families who rely upon employers have very different stresses and expectations - nobody's COVID 19 pandemic experiences have been exactly alike.
• Add to that unpredictable mix a dash of enforced home-schooling and … well … it's very clear that nobody's COVID 19 pandemic experiences have been exactly alike.

We’re seeing the ‘green shoots of hope' for a better future

Many people who initially felt like a ‘startled deer in the headlights’ are now discovering their fear giving way to more practical thoughts about simply finding a way through this mess we’re all in together.

Many tell us they now spend more time prioritising essentials.

People are having more conversations with their family about the difference between ‘nice to haves’ and ‘need to haves’ and for those with school aged kids, they’re becoming more aware of the academic progress of their children at school (never a bad thing).

People are changing, adapting, growing (and grieving) — all at the same time.

Some of the lessons we are all learning day by day

Reflecting today on how you and your family and friends are being impacted during the COVID-19 pandemic – pre-mass-vaccine phase, has it been a time of financial stress for you, a time of financial opportunity or a strange combination of the two?

Living day by day, changes day by day.

Looking to the post COVID-19 future

In Australia, the Federal Government's welfare program JobKeeper Wage Subsidy payments began in May 2020, stopped in April 2021 and were the only thing keeping many people above water. This month Queensland, Sydney and Victoria are now in another set of selectively forced lockdowns and we all wait expectantly for news around the country to see what's ahead.

• Regardless of what happens next, what we do know is our attitude towards coping with change, is probably the only thinking we can control and probably our best defense.

We also realise we have to continue to live and find a way through as best we can for ourselves and our families and friends.

So how are different people managing life and money matters during COVID-19 in Australia?

The number one thing that people report as helping is working to maintain some sort of routine and a sense of calm with a daily structure.

That rings true for both personal and business life.

Below are some of the many personal, business and general practical tips people are using to exert a degree of control in their life as they face the unpredictable and uncontrollable events around them.

Practical Strategies for Families

• When homeschooling manage screen time and physical space (and no-go-zones during working hours if needed)
• Deliberately reduce your own media consumption on issues you can't personally control - don't leave the TV on all day and resist the cult of tuning into the daily damage reports that are similar to yesterday, and the day before and ...
• Reassure & discuss children's fears. Because children rely on their parents for safety, both physical and emotional. Reassure your children that you are there for them and that your family will get through this together.
• Model how to manage feelings. Talk through how you are managing your own feelings. (“I am worried about Grandma since I can't go visit her. I will put a reminder on my phone to call her in the morning and the afternoon until it is safe to see her.")
• Download our free eGuide about 31 Financial Habits You Can Model for Your Kids, here.
• Know when not to respond and simply 'let it go'. Some things you need to let go of and not respond. If you haven't been required to learn the words of Disney's ‘Frozen’ and Queen Elsa theme song Let it Go, you either don't have kids in your life or you could do with a break.
• Actively hope and look forward to a better day ahead.
• Have age-appropriate conversations; tell your kids our scientists are working hard to figure out how to help people who get sick, how to prevent it, and that things will get better.

Practical Strategies for Small Business Owners

• Keeping business expenses and subscriptions in check means you have to know where your money is currently going so once a month stop and evaluate your fixed business overheads cost and the variable business costs and trips, as you need.
• Focus on the Customer and Cash Flow
• Review exactly what service you are providing to your customers and know which of your products and services represent the highest margin for you.
• Review your Marketing Costs and remember you also need to plan for the better days ahead
• Have a conversation with your accountant and explore any government business support options
• If you haven't already (and particularly if you're a sole trader) make sure you have separated business and personal finances
• Plan for the short term, then medium term then longer term future ahead
• Make sure you are aware of Fixed Business Expenses Insurance (its like income protection for a business's fixed costs)
• Stay connected - reach out to other businesses in the same position and look out for each other

Practical Financial Strategies for Small Business Owners

• Where possible reduce financial liability
  In these tough economic times, it’s important to maintain or increase your liquidity and have a plan to reduce your debt obligations as much as possible.
• Where possible defer, reduce, refinance or renegotiate
  Check if it’s possible to defer your rent payments, refinance loans, or renegotiate vendor contracts. If you can, check with banks if you can temporarily defer any interest payments on outstanding debts and take the opportunity to increase your liquidity reserves rather than a luxury purchase.
• Look after your team and make sure they are doing as well as possible
• Refinance loans to lower rates, suspend personal drawdowns from business income - (you might find that useful if you have to refinance or debt consolidate)
• Embrace flexibility in working - now is not the time to insist on business as usual if it's not currently business as usual - you will need to rely upon the discretionary effort and patience of your team as they learn to adapt to remote business, so be flexible.
• Explore working-from-home options, get to know your tech deficiencies and perhaps now is a good time to do a Technology audit so you can better chart the way ahead.
• Plan more- write down the goals for the week, the month and the quarter and if need be put them where you can see them and tick them off. Nothing protects a feeling of wasted time like a list of checked-off tasks for the day.
• Keep a list of positive progress and create a culture of ‘Celebrating the Small Wins.’ All small progress steps are part of building a positive routine.
• Cut yourself some slack - we’re all relying upon suppliers who may be using remote teams working from home or with reduced resources - so cut them some slack.
• Take the dog to work
• Master a new skill. There are some skills you just need to master - so do that - no excuses. Learn how to use and then master online video meetings - whether they are for customers, staff or suppliers.

Pro Tip: When using online video meetings like Zoom, Google Meet or MS Teams, where possible leave 10 minutes an hour between meetings. Some call this deliberate gap in activity ‘travel time’ but whatever you call it - it reduces the stress of ending one meeting and immediately being late for another. At Sapience we aim to do 25 or 50-minute meetings only so that we’re not booked back-to-back so we can collect our thoughts, make notes and be better prepared for the next meeting.

Here is a useful link from CPA Australia to more advanced Business management during these very difficult times. 

Looking to the future

There's no guarantee that this will be our last health and financial crisis that we will all have to face together. (Global Financial Crisis anyone?)

For many people, still juggling intermittent lockdowns, new and unexpected homeschooling responsibilities, vaccination changes and delays, managing the terrible and tragic emotional costs of deaths of extended family, friends and associates overseas - or even closer to home - truly the full financial and emotional cost of COVID19 is yet to be fully understood across all areas of our financial and emotional lives.

So what's the point of trying?

The full effects COVID19 will still be felt and only later really understood, in the years to come.

That said, we still have to find a way through today.

Preparing for post-COVID-19 financial life

After all the uncertainty, one thing is clear — individuals and businesses will need to do more to manage their finances during COVID-19 and post-COVID-19 to recover. There will be ongoing effects, new taxes and changes to the financial landscape that we will all need help managing through access to high-quality advice and services to make that happen.

When another government assistance package is rolled out and it becomes clear you’ll need either a Ph.D. in astrophysics to understand some of the small print - or simply a connection to a capable Accountant to help you join the dots - stay connected to your professional advisers.

Start your post-COVID-19 planning now

The best time to begin to find your way through this mess is to move ahead today.

• Whether that's starting small and prepaying the power bill a quarter in advance or developing the skills of habitually rounding up when paying all utilities and council bills to the next $100 and creating that buffer of advanced payments, start controlling what you can today.
• Be aware of the latest in prepaid mobile plans (you would be amazed at the savings you can make) — it's the mindset more than the savings by the way — what we do next when facing our current crisis determines our capacity to adapt, survive and ultimately set us up for the chance to thrive, again.

Admittedly, behavioural change isn't always easy but it's simply an unavoidable part of success is knowing and acting on ‘what will it take to get you there?”

Personal financial responsibility has never been so important as it is today.

And while it's clear that nobody's COVID-19 pandemic experiences have been exactly alike, the green shoots of hope for a better tomorrow are built on the personal new habits we choose to adopt today.

Drew Browne is a specialty Financial Risk Advisor working with Small Business Owners & their Families, Dual Income Professional Couples, and diverse families. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His business Sapience Financial Group is committed to using business solutions for good in the community. In 2015 he was certified as a B Corp., and in 2017 was recognised in the inaugural Australian National Businesses of Tomorrow Awards. Today he advises Small Business Owners and their families, on how to protect themselves, from their businesses.  He writes for successful Small Business Owners and Industry publications. You can read his Modern Small Business Leadership Blog here. You can connect with him on LinkedIn.  Any information provided is general advice only and we have not considered your personal circumstances. Before making any decision on the basis of this advice you should consider if the advice is appropriate for you based on your particular circumstance.