Independent Bank is proud to sponsor the Greater Memphis Chamber’s Small Business Council.  We are so impressed with the way the Chamber has been able to take the “Lunch in the Know” series from offline to online in order to keep small businesses engaged and bring them timely and relevant information.  David Waddell and Teresa Bailey with Waddell and Associates presented the second in the webinar series: “Shaping Your Recovery in the Second Half.”  Here we recap our Top Takeaways:

There is reason to be optimistic!

David did an incredible job of comparing the recession brought on by COVID-19 to that of other past viral pandemics.  His research indicates that the pattern of recession and recovery will likely resemble that of the 1957 Asian flu pandemic more than any of the others, which offers a more encouraging outlook for the future.  David also explained that event-driven recessions recover much faster than structural or cyclical recessions, and he assured us that based on most analysts’ predictions, what we are experiencing is nowhere near comparable to The Great Depression.

David believes we have protected ourselves against a financial crisis with the stimulus packages from the Fed and that the amount of stimulus should be enough to protect against an economic crisis, but that will ultimately depend on if we can avoid a healthcare crisis.  The outlook here is also positive as testing for an anti-viral and vaccine are well underway.  The bottom line?  “We have reached the halfway point!”

Now What?

As Teresa mentioned, there are things we can control in all the chaos.  The first thing you do is evaluate your financial team and how they performed for you over the last month.  This team consists of your banker, CPA, financial planner, attorney, and human resources manager (and additionally your employee benefits and payroll vendors if applicable).  If any changes need to be made, now is the time to implement.

Next, assess whether your Emergency Fund was properly funded.  An individual should maintain 3 to 6 months of living expenses where as a business should maintain 3 months to 1 year of expenses.  When taking these expenses into account, it’s important to take into consideration all possibilities and be prepared for the probabilities.  And then some, if you really want to sleep at night.  Don’t wait to start funding this account.  You need to be setting aside money every month if you can.

Make sure you can easily identify which of your expenses are mandatory and which are discretionary.  If you don’t already have a record-keeping system in place, add that in now.  This would also be a good time to review your legal documents and update them if necessary.  Make sure you keep digital copies and that everyone who needs access has it.

Waddell and Associates has put together a lot of resources available on their website.  During the presentation they took us through their Financial Prescription for Individuals and their Financial Prescription for Businesses which go into more detail on things you might consider as we begin our economic recovery.

Thank you to David and Teresa for sharing their insights with us! We’d also like to thank our fellow sponsors, Southland Casino Racing and Baptist Memorial Health Care, as well as Waddell and Associates for making the Zoom meeting possible.  If you missed the webinar or would like to see it again, a recorded version can be accessed on the Greater Memphis Chamber website.