Do’s and Don’ts to Protect Your Retirement During a Financial Crisis

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One of my biggest pieces of advice during any financial crisis is to not panic. Panic causes us to act irrationally—some people start to hoard toilet paper, some people start to hoard cash. In any case, how you decide to spend or save your money right now not only affects your current financial situation, but also your future goals and retirement plans.

Today I wanted to share with you some of the top do’s and don’ts to protect your retirement during this financial crisis. These are inspired by the thousands of questions that are pouring in from all of you right now to my Suze Orman Women & Money Podcast Ask Suze episodes. I hope you find these helpful, and if you have a question that I haven’t covered yet, you can submit it using the form at suzeorman.com/podcast.

Do’s

• Get help early on. I want you to be proactive and reach out to your bank, credit union, credit card issuer, mortgage issuer, landlord, car loan provider, utility companies, every bill issuer you have now. You should find out what programs they have in place to help you during this crisis and then enroll in them at the first sign of trouble.
• Save your cash. Only if you are living paycheck to paycheck or do not have an 8-month emergency fund in place, I want you to begin saving your cash and only paying your essential bills. This means no retirement contributions too. If there is no assistance offered to delay your payments, I want you to only pay the minimum payment – nothing more! And if you have to miss a payment, I want you to first miss the non-essential bills, like your credit card. Staying healthy, keeping a roof over your head, and food in your stomach should be your main concern right now. We can repair your FICO score and get you back on track for retirement after this crisis is over.
• Get your Must-Have Documents in order. The most important document you can have to protect yourself and your loved ones’ financial future is a Living Revocable Trust. I also highly recommend having a Will to grant guardianship of children if both parents pass, as well as a Financial Power of Attorney and Advanced Healthcare Directive in place so that in the event that you become ill or incapacitated your financials can be taken care of and your healthcare wishes are known. Because these document are more important now than ever before, I have discounted my Must-Have Document Program for you today. You can have all four of your Must-Have Documents completed within an hour. They are legal in all 50 states and can be updated for free at any time. Simply print, sign and notarize. Click here to learn more.

Don’ts

• Don’t sell all your stocks. If you have been following my advice and have a well-diversified stock portfolio and have been dollar cost averaging with regular monthly contributions, and you are not retiring in the next 10 years, do not think about throwing that all away and selling now because you are scared. Our stock markets have always recovered and grown after every downturn, and it will do so again after this one. Selling out of fear right now will only push your retirement goals off track.
• Don’t cash out your bank accounts. When panic sets in, many people will find themselves running to their local bank or credit union and withdrawing their accounts into cash. I cannot emphasize enough how important it is to not do this! Your accounts are federally insured in both bank and credit union accounts up to $250,000, but they are not insured at all once they are withdrawn into cash-- even if placed in a safety deposit box. Theft or natural disasters or accidents can easily see your entire stashed cash savings go up in flames.
• Don’t withdraw from your retirement accounts. During a financial crisis it can be very tempting to see the money sitting in your retirement accounts and think that they are a good option to withdraw from. Especially since many of you have heard me tell you one of the benefits of a Roth retirement account is that you can take the principle out at any time with no penalty. But I want your retirement accounts to be the absolute last line of defense in getting through this rough time. One of the most important reasons why is that your retirement accounts are protected up to 1.3 million dollars if you file for bankruptcy, but as soon as they are withdrawn they are no longer protected.

Another way to protect your retirement and keep your financial life on track is to take this extra time that many of us now have without commutes or all of the kids’ extracurriculars, and commit to furthering your financial know-how. You can do this for FREE by reading my blogs at suzeorman.com, listening to my twice weekly Women & Money (and the men smart enough to listen) Podcast, or by listening to my Ultimate Retirement Guide for 50+ audiobook.

That’s right, you can now listen to my brand-new bestseller The Ultimate Retirement Guide for 50+ audiobook for FREE until April 30, 2020 at suzeormanaudio.com. This is my gift to you during these turbulent times because I know these important money lessons are needed by so many.

Stay healthy, keep learning, keep improving. You’ve got this!

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Getting Through the Crisis

How long might this go on? What will the unemployment picture will look like? What should I do with my money? Bills, unemployment, stimulus, landlords, business loans, dealing with loss. On my latest podcast we're talking about the many aspects of the ongoing COVID-19 crisis. Listen and subscribe to Suze Orman's Women & Money Podcast on your favorite podcast streaming app.