CoronavirusSep 9 2020

The pandemic is radically changing the way we live

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When do you reckon we will be free of the Covid-19 pandemic?

Will things be back to normal by Christmas? Or will we have to wait until the spring? Or, heaven forbid, could it last much longer than that?

With so much uncertainty still around, it is a guessing game, isn’t it? But I hear that senior bankers are working on the basis that the current crisis could last until 2024 – which would give us another four years of pain.

The nature of the pandemic means life will not return to what it was

That is them naturally being prudent. But anyone who thinks we will be returning to normal any time soon, needs to take off their rose-tinted glasses, throw them to the ground and grind them into dust.

For starters the nature of the pandemic means life will not return to what it was. Do you think hand sanitisers and masks will simply disappear? They will not. They are part of our daily life for the foreseeable future.

What about the shift to working from home?

That is certainly going to become a permanent change for many folk, even if only because some companies have discovered they can function perfectly well while saving a packet on office leases.

Legal giant Linklaters, for instance, has said that all of its 5,300 staff could spend up to 50 per cent of their time working remotely from now on.

Lloyds Banking Group said it is reviewing its office space needs and working practices after discovering that most of its 65,000 staff have worked effectively from home during the crisis. NatWest and HSBC have also said they will allow much more flexible working in future.

Meanwhile many workers themselves have realised that working from home can be better for them and are likely to fight to be able to continue doing so.

Eliminating the commute, whether it is on public transport or in a queue of cars, has improved many people’s lives for instance, even if it is just because it has freed up an extra couple of hours a day.

Some people, of course, have struggled with having to work from home.

It has been a nightmare for those in flats or who have had to work from their bedroom, which means there is no escape from being reminded about work 24 hours a day.

Those people are more likely to want to return to former practices. But will they be able to? The government certainly hopes so. It has splashed out on an ad campaign to encourage workers to return to offices.

Critics said that was just to keep sandwich bars and coffee shops in business, but it is more fundamental than that.

The Confederation of British Industry has warned that city centres are in danger of becoming “ghost towns” if workers do not return.

It will not just be the food vendors that will suffer if they do not, but all the shops and other local businesses that rely on the passing trade from workers spending during their lunch hours.

The usual return to work after holidays at the beginning of September this year was “a trickle not a torrent”, according to The Guardian. That does not suggest that wide-scale commuting will return for everyone for some while.

That view was backed up by the Bank of England.

Alex Brazier, the BoE’s executive director for financial stability strategy and risk, warned: “It’s not possible to use office space, particularly in central London and dense places like that, with the intensity that we used to use it.”

But if a big percentage of people do not return to offices, it will have an impact on other people’s jobs and could lead to even more businesses going to the wall.

That is just one aspect of the economic impact the virus is having, and it is going to leave most of us with a financial hangover lasting many years.

That in turn hits any financial planning we may have had in place. Look at retirement. I have spoken to quite a few people now who have said they are thinking of retiring much earlier than they originally planned.

In some cases it is because work has dried up so the decision is very much a pragmatic one.

In other instances, being forced to spend more time at home has led them to realise that there are other things they would like to do, and especially while they are young enough to enjoy them.

In some specific cases people are accelerating their retirement plans because the companies they work for – often for decades – have forced workers to accept lower pay or worse conditions, using the crisis as an excuse.

For whatever reason, people are making fresh life decisions, which may often leave their long-term financial planning in tatters. Sure, it is difficult to make any specific plans at the moment with so much uncertainty ahead, but people are still eager to plan.

Some financial advisers may be going through the same thought processes, but even if you are not, you can bet that many of your clients are.

It is certainly worth getting in touch with them to help ensure their finances are fit for whatever new plans they have.

Simon Read is a freelance journalist