Everyone is eager for life to get back to “normal” right now.

Normal, however, has changed.

You may miss the gang from the office, the night out at the bar or the chance to go to the movies, but you also may be making the most of the relationships with your kitchen, garden, yard or with friends and family members who too often were overlooked in the rush of “normal days” before the coronavirus pandemic.

 We’ve learned that there is a big difference between what’s normal and what’s actually “best” for us.

 As much as we crave normalcy, we also want things to get better, and some of the new or renewed behaviors created, enhanced, enforced by or resulting from the pandemic may be better than what we get with normalcy.

 That’s definitely true with investing and savings behaviors, especially when the hardships of a volatile market and the uncertain working/employment conditions for so many people are factored in.

 It’s not that savers and investors should fall for the most dangerous words in money management — “This time it’s different” — it’s that they should recognize from the current troubles and uncertainties that when it comes to their money there are better behaviors than what, until recently, was the norm.


Here are five behaviors that investors, savers and consumers should embrace as their “new financial normal” moving forward:

Lengthen your investment time horizons.

The short-term outlook is completely blurred and confounding; the long view is hard to read because the ultimate return to normal will raise numbers up from current levels but the gains may be more artificial and situational than real.

 “This near-term uncertainty creates the situation of a deer in the headlights, and you get out of that by extending your time horizon,” said Crit Thomas, global market strategist at Touchstone Investments, in an interview on “Money Life with Chuck Jaffe.” “As you extend time horizons, your appetite for risk assets increases because a zero-yielding cash balance isn’t helping you.”

 Jim O’Shaughnessy agreed that time, ultimately, wins out. “All of history suggests … that stock returns have been positive 70% of the time, negative 30% of the time, and I love those odds,” said the bestselling author behind “What Works on Wall Street” and founder of O’Shaughnessy Asset Management. “America has been through some really scary things,” he said in a “Money Life” interview. “Stay the course, focus on the long term. Our outlook hasn’t changed; I will never bet against the American people being able to figure things out and move forward.”

 But in urging that “this too shall pass,” O’Shaughnessy, Thomas and other strategists acknowledge that investors may have to wait longer than “normal” to feel like that history is paying off; plan on it.

Change your asset allocation by removing some bonds or adding riskier ones.

 Bonds are the traditional safe harbor for investors, the asset for security and balance when the market is frothy.


But Dan Fuss, the legendary manager of the Loomis Sayles Bond Fund — who has run a bond fund since the 1950s — said on my show last week that “The bond market is not a safe haven right now.”

Investors must treat it differently now.

 It’s not that balanced investing won’t work, it’s that the balance point is changing. The 60-40 classic stock-bond ratio should be more like 75-25 going forward.

 “Things evolve over time,” said Michael Falk, of Focus Consulting Group. “You have to rethink, update and evolve. What do you do when bonds aren’t working the way they have historically? You need to update a formula that has been wonderful but that won’t be wonderful again.”

 If ultra-safe Treasuries can’t deliver sufficient cash-flow — and they can’t — income-oriented investors must move some bond dollars toward higher-yielding, riskier bonds or ultra-safe stocks.

 Alter your perspective on income-producing investments.

In changing asset allocations, the portion of a stock portfolio that is supposed to act like bonds should be treated like bonds; investors who buy equities based on income characteristics — as the asset allocation change demands — must focus on an investment’s distribution stream rather than total return.

If you invest $10,000 in a stock or closed-end fund with a 5% dividend yield, you’re aiming for that payout in all conditions. If the price moves, the yield for new buyers will be higher or lower (because yield is a percentage of the stock price), but the money you invested is still at that 5% level (barring a dividend cut).


 Value a safe payout stream — if that’s your primary factor in picking an investment — and don’t let price shrinkage or growth derail that.

 Respect the next emergency.

 Americans were woefully unprepared for emergencies entering the pandemic, and had a million excuses for not building cash reserves.

 If you have seen the folly in that, because the pandemic can remain dangerous longer than you can remain solvent, then change how you define and save for an “emergency.”

 Having three to six months of salary in cash reserves may have seemed excessive before, but today it feels like reasonable planning.

 Start rebuilding cash reserves now and keep building them until they are more than sufficient.

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Don’t ramp up your spending on things you don’t need.

 As much as the business community needs consumers to return to normal levels of spending, most families have discovered that there’s a lot they can do without.

 One lesson every family should try to absorb from the pandemic is that a lot of money is wasted on things that normally are perceived as “important.” Doing without many of those things — and cutting spending and economizing as a result — hasn’t felt austere or severe; keep that in mind, and put your money to use on what’s really important, rather than going back to spending out of habit.

 That’s how you will find more money for emergency reserves and to fund your long-term patience.