Your Finances Took a Hit From the Pandemic. Here’s What You Do Now.

As for that tax return, it never hurts to organize all the tax data you can during the last few months of the calendar year. It’s a record of your recent past and a window into your long-term future (say, via any notation about retirement savings). The process may also serve as a reminder that there is often at least one more thing you could do in the present to help yourself while handing less money over to various governmental bodies.

Prepare yourself now and you can file as early as possible in 2022 and quickly get any refund you have coming. One note of caution: Donna Trainor, a financial planner and accountant in Atlanta who has done extensive pro bono work with people in danger of losing their homes, worries that recipients of the new, monthly tax credit payments don’t realize that it is a kind of advance. Getting it now means you may not get the same size tax refund that you normally do, so you’ll need to take any such expectation out of your 2022 budget.

Don’t just contemplate catastrophe.

Now, for the searching questions about your feelings.

Even for those accustomed to financial uncertainty, the pandemic may have increased the kind of catastrophic thinking that can suffocate your ability to plan and prioritize.

Out in Hollywood, among a class of workers that resemble theater people like our money mentor Stephen, even the most successful were often gripped by fear, said Leighann Miko, whose financial planning firm works often with people who move from gig to gig.

“The fear was that things would take much longer to recover,” she said. “People thought they were going to have to pursue other means of employment.” What they really hoped to avoid was what she called “Plan Z,” the code for former jobs in different industries that they were hoping never to have to take again.

Ms. Miko sees a kind of psychological scarring all around her, even among people making $600,000 per year. Cry them a river, but they know good and well that even absent a pandemic, a year with just $30,000 in earnings could easily be around the next corner. To help those who can’t conceive of doing anything beyond the dream jobs they’ve worked so hard to obtain, she plans and schemes — and tries to get them to, as well.

“Minimizing the catastrophizing means ensuring there are multiple layers to every safety net,” she said. “Because at some point or another, they are going to fall through the first one and then the second one.”