Pandemic Does Not Mean Panic

Some days seems like we are living near an abyss. The news is fascinated with scary stories, new breakouts, death counts, and possible treatments. The medical science may be scarier as highly contagious coronavirus is affecting more than lungs, attacking organs and causing blood clots. Seems like will be uncomfortable or worried forever.

If you have suffered from Covid-19, have sick friends or relatives, lost a loved one, or one of 26+ million & growing unemployed. Am sorry. Rehabilitation, recovery and grief are painful and take a long time. We miss people, our life is disrupted, finances affected, economies struggling, and the end is not in sight.

Life will go on. It always has. Treatments will be improved and successful. Vaccines will be developed and available. We will once again laugh, find work, travel, and see family and friends.

See two ~100 year old pine trees from my window. Trunks are ~3 feet thick and trees are ~70 feet tall. Some disease or discomfort caused the right had tree trunk to split into 2 separate trunks ~1/3 of the way up. 

Look closely at the right hand trunk about 20 feet down from the top. The trunk broke completely off. A strong storm or lighting did it. Did this tragedy stop the tree from growing? No, it simply started growing new shoots off the side of the broken trunk. Every bit as healthy as the twin and neighbor.

These trees provide shelter and food to birds and animals. See eagles resting at the top, and smaller birds below. 

You are going to be like this tree. After dislocation you are going to adapt, grow and thrive. You will mentor, advise, support and love family, friends and neighbors. Benefit from what we are going through. Hard times grow more faith than good times.

These Are The Stories You Will Tell

Pandemic has put people in isolation and created difficult times. Working from home with family and distractions. Unemployment is climbing towards ~15%-20%. People laid off, forced to retire early, losing retirement investments, having to find different work, becoming a gig worker, possibly losing a car or home, or being homeless temporarily. 

These are the stories you will tell years down the road after you figure it out. Heard stories in my youth from elders and now tell mine. Intend to tell stories how I overcame issues and became more successful after this over.

The past is full of examples of people overcoming hardships: Mayflower. The westward expansion. Irish potato famine. WW1 trench warfare. Spanish flu infecting ~1/3 of the world’s population & killing 1 of 10. The Great Depression. WW2 warfare and British citizens surviving months of bombings. 9-11.  Terrorism.

Do you know the difference between being broke and being poor? Being broke is temporary. Being poor is life long. I have been broke and unemployed several times. My career has not been kind - periods of unemployment, pay cuts and self-employment failures. Changed industries (which I was told was impossible) and moved several times including cross-country to find work.

The difference is studied my skills and found ones was good at. Then tried to find industries and companies that need those skills. Constantly learning new technologies in demand. Asked people for help and networked. Failed often. Persisted in trying different ways.

Use this time to review your successes in life. What skills did you use? Which skills would you like to use daily? Study successful people in books or articles. Why were they successful? Which examples can you implement? Research what work is in demand. What low cost training can you do now? You don’t have to be perfect. You only need one job.

We are more resilient than we think. Hang in there. If you learn more and keep trying new ways, you eventually figure out how to succeed in parts of life. And we learn God loves us unconditionally. You have stories to tell.

Tax Preparation Software Review

The IRS has extended your due date to July 15^th, 2020 but don’t wait till last minute. 

These tax software reviews are based on my ~20 years of filing tax returns online while running my businesses and as an employee. Also do my sister’s tax returns who’s health issues kept her below the poverty level. Have encountered several challenging situations was able to solve and file using different programs. Don’t overpay to get them done. Most people can do this easily without the upgrades offered to you.

Stimulus Checks, for people who don’t file taxes: IRS.GOV website front page there is a box “Non-Fillers: Enter Payment Here”. Simply enter your bank’s routing number and account number. Both are on your checks, or you can look them up online. Don’t pay anyone to send in this information.

If your Adjusted Gross Income (AGI) is under $69,000 and you use the standard deduction, filing your federal taxes are free. Normally a fee to do state taxes. AGI is your gross income less 401K/HSA deductions plus interest & investment income. If your income is over $69,000 you can shop several programs below to save. With higher standard deductions of $12,200 for single and $24,400 for married couples, approximately 90% of filers only need standard 1040A.

On the IRS.GOV home page click the box “Do Your Taxes for Free”. Click the box “Choose a Free File Online Product”. Then you can read which programs you qualify for. IRS.GOV provides “Lookup Tool” to prequalify you showing which programs work for you.

The terminology of taxes is confusing. The IRS provides Publication 17 “Your Federal Income Tax (for Individuals)”. It is free and explains plain language with more detail what you need to do in each tax section and box no. if you are confused. This was my bible from the days of preparing my taxes on paper. Between Publication 17 and Google have figured out several complicated situations correctly.

FreeTaxUSA.com - did my sister’s taxes in about half hour. This year she needed to cash in a savings bond and required filing Schedule B Interest form. FreeTaxUSA has simple navigation between sections and help explanations were short and easy to read. Comfortable to use. Uploading last year’s PDF form failed, but no issue entering data. If you have any experience with a 1040A provides basic support State return costs $14.99.

TaxSlayer.com - have not used yet but gets great reviews. $0 Simple tax return including state tax return. If you don’t qualify starts at $17 plus additional for state return. Premium is $37 and Self Employed is $47. Will work for most people who are comfortable filling out forms with basic support.

TaxACT.com - used for my sister’s return until this year. The fee they wanted for a Schedule B Interest form drove me to research FreeTaxUSA and TaxSlayer. Good program for those who are comfortable filling out forms with basic support.

CreditKarma.com - has expanded into tax preparation. All basic federal and state returns are free. Has a new entrant only a few reviews, but a good choice if you made over $69,000.

H&R Block (hrblock.com) Online & Phone App - On of the largest nationwide tax preparer organizations. Their training is the standard CPAs often take annually to know updates. Have not used myself, but Dad and Mom worked for H&R Block after retiring. Reviews are good too. Online provides Free, Deluxe, Premium and Self Employed levels that are higher priced. If your situation is more complicated may well be worth the money.

TurboTax.com Online & Phone App - been using for almost 20 years now and is my favorite. Software suggests deductions you may have missed. Excellent online and community support if you have a questions. Makes filing painless. If you have business, investments, side hustles and itemize worth the money. However the upsell offers are Annoying! Why do I have to answer the same question multiple times? Do take advantage of any discount from credit union, Costco or filing early.

CPA/Tax Preparers - If you have multiple businesses, investments or rental properties well worth the investment for advice, professional contacts and guidance. Recommend my former CPA in CA any day. Wish had those investments.

Enjoy using online tax software since they are updated daily, very accurate, and catches my errors and typos. E-filing and direct deposit is the way to go. For most of us this is a simple process of less than 2 hours. Start with all your forms, because hunting for forms just make data entry and tax filing seem to go on forever.

Survival Actions for Unemployed

Over 16 million have applied for unemployment benefits in the last 3 weeks. Coronavirus has disrupted economies worldwide. Been there several times in my career. You are not alone. 

Here are steps for you to take:

1) Grieve Losing Your Job. Being unemployed is emotional. You miss your routine, paycheck, coworkers, job friends, and peace. Most of us have identity from our work. We plan vacations, visiting family, and how to pay for large improvements, cars or luxuries. Heck, now you worry about getting take out. This is a big loss up there with divorces or losing loved ones. Give yourself permission to go through the grieving process. Your mental health will thank you.

2) Apply for Unemployment Now. Normally unemployment only covers part of your expenses, but the CARES act adds $600 per week until July 31^st and covers freelancers, gig workers and care givers if your employment is affected. Take advantage to give yourself more time to find work.

3) Find Taxi Jobs. These jobs are not careers, but ways to make money during your job search. You can stretch length of your unemployment benefits if you earn money during week. I worked for the Census Bureau twice during 2008-2009 recession.  Supermarkets and delivery services are hiring now. Or start gig work while you look for jobs.

4) Take Survival Financial Steps Now. Look at where you are spending your money and write it down / enter in spreadsheet. Look where you can cut or postpone payments. Internet is necessary, premium movie channels & streaming service are not.

Payment Deferral - Forbearance is a written agreement between the borrower and the lender to move a negotiated number of payments to the end of a financial obligation, eliminating required installment payments now, and preserving your credit rating. Negotiate with your lender for a six-month forbearance (traditionally the standard), then resume payments after the term.

Freeze Your Memberships - Contact health clubs/spas, golf or tennis memberships, tanning, recreational clubs, social clubs, etc. requesting a freeze. This preserves you rejoining in the future when working your new job.

Mortgage Re-casting or Mortgage Re-amortization - If you have been in your house a while paying down balance or made extra payments, lenders recalculate your mortgage based on the new principal balance instead of refinancing. Avoid refinancing mortgage fees and underwriting expenses. I need to do this myself.

[Full credit to Heather Wagenhals “Unlock Your Wealth” and Jim Woods “Successful Investing” & “Intelligence Report” for ideas in this section]

5) Write Down All Your Skills - These are not job titles. Write down individual tasks or projects you have done on all jobs. The skills you used have lead to business successes.

Next you classify these skills in 3 categories - Those skills you enjoy & want to use, those skills you tolerate, and those skills you can’t stand. Preferably your next job will use most skills from the first 2 categories so you’ll be successful.

Reason for this exercise is you may be in a field that is changing or dying. Will be very competitive to find work there. New careers are created every year that use skills you already have. Identifying these skills will help you research alternative career paths forward.

The economy may evolve, but definitely will recover from Coronavirus effects. Future may be different for certain industries. Quite aware could be unemployed in several weeks myself working on commercial airplanes. Not too many travellers for near future, but in a couple years airlines will recover. Meantime other companies will grow and need our skills.

We have the resilience and talents to thrive in the future. Doesn’t mean we won’t be uncomfortable, but we have already overcome and learned much being uncomfortable. And on an Easter weekend we are reminded God is still in charge.