May you live in interesting times

Question: Despite the pandemic, life moved on. In your practice of providing financial advice, what were the strategies people used to survive the COVID-19 years?

Answer: “May you live in interesting times” is said to be a traditional Chinese curse. Contrary to popular belief however, there is no equivalent expression in Chinese for the saying. Wikipedia says that the closest Chinese expression is, “Better to be a dog in times of tranquility than a human in times of chaos.”

In practice, the expression is used ironically and can very well apply to the past two years of the pandemic when the whole world lived in “interesting times.”

But the pandemic was not all negative. Some businesses thrived by becoming resourceful. Online shopping became all the more popular and so did home delivery services. Business meetings and even training programs became more convenient via the Internet. Several Yaman coaches also benefited.

Coach Jho Julian who also runs an accounting business says that her market expanded geographically. Despite being based in Laoag, Ilocos Norte, she was able to get clients from Iloilo, Davao and even as far as Australia and London all through the enabling technology of virtual meetings.

Coach Rose Gases’ years of learning personal finance management were put to good use when her family faced diminished income during the pandemic. But more than money, she benefited from the realization that the cooperation and coordination of each member of the family was critical.

Even in hard times, investing does not stop. That is why coach Zig Diaz relied on a strategy of keeping in his portfolio high dividend paying, defensive and cheap stocks that also had the potential to ride the bull market after the prolonged pandemic bear market.

Coaches Arnold Anog, Myla Factora and I were able to continue earning from providing behavioral and practical personal finance advice to employees of companies that needed to lay off some of their people due to strategic realignments compelled by the pandemic. Yet it was seeing people emerge from our counseling with encouragement and clear detailed action plans in the face of an uncertain future that gave us the best reward.

Interestingly, the strategies of people who were about to lose their jobs fell into three major categories. One is to look for a new job. But in doing so, we stressed that they should not let their skills—built from years of working—be haggled away by accepting low wages from potential employers. In fact, as many of these employees were factory workers operating machines, we always asked them to compare the loss to a company that would be avoided with the difference between their asking salary and what the potential employer was initially offering if a less experienced worker was hired instead of them.

Another category was to look for a new job while getting their spouse to also work as an employee or handle a business to be set up from their separation pay. Of course, this strategy would need to be tested against the ability of the spouse to be employed or self-employed. Some of the laid off workers still had young children who were being taken care of by their spouse. Other spouses did not have the knack for running a business.

The third category is for the laid off employee himself to go into business. In counseling such employees, we could see who among them were cut out to run a business and were enthusiastic enough to do so. But we cautioned them that they needed to ensure that they had to first come up with the product or service for their business, figure out how to market that business, determine the people they will need to run the business and then do the number crunching to arrive at the investment required—in that particular order.

And a common denominator of these three categories is the need to be more frugal. Many of the employees got used to earning overtime pay, to which they had adjusted their lifestyle. With overtime pay gone, they would need to adjust their discretionary expenses like those for entertainment, travel, optional support for extended family members, personal care and effects, tobacco and alcohol.

In essence, brutal as the pandemic was, it did not mean the end. As we always say at Personal Finance Advisers or PFA, when you reach the height of pessimism, just take the “H” from height, the “o” from of and the “pe” from pessimism and you end up with “hope.” INQ

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Efren Ll. Cruz is a registered financial planner and director of RFP Philippines, seasoned investment adviser, bestselling author of personal finance books in the Philippines and a Yaman Coach. To consult with a Yaman Coach, email [email protected]. To learn more about personal financial planning, attend the 99th RFP Program this January 2023. To inquire, e-mail [email protected] or text 09176248110.