Brad Morin

“I’m a financial adviser, so I help clients with retirement planning, risk management, tax planning and business planning.”

“In the midst of the coronavirus I’ve seen a few of my business owner clients talk about folding up shop. These are clients that own restaurants or are in the entertainment business. I’ve got a few clients in and out of state that own AV businesses, so they set up shows for companies. All their venues canceled on them all the way until August. They are pretty much out of a job and [trying to collect] unemployment right now.

“Initially we were more afraid of the virus, but the more and more I talk to people, people are more afraid and uncertain about what the government’s going to do next. I think the solution would be to get people back to work but be cautious in the way that you do it. Have people take their temperature before leaving the house for work, wearing masks in the workplace, etc.”

“I’ve lived [in Illinois] all my life. I know the trouble the state is in. What it’s doing to itself right now, we’ve seen that they don’t even have enough money to pay the unemployment. Their emergency fund as a state is tapped.

“This is a lesson to our government. We’ll see whether Springfield or our governor learn from this. The lesson is that we need pension reform and we need to balance our budget as a state so that we can be better prepared for the next virus. … If we had a worse [virus] that would have lasted longer where we would have to close the economy down longer, our state would go bankrupt. It might still go bankrupt.

“[The state needs to] balance the budget like every other person or family. Pension reform is one thing that everybody talks about, but nobody wants to touch it. But that’s one thing they just have to do to save the state. Instead of talking about the budget and cutting expenses and pensions, they’re talking about how to tax us more and that’s not the answer, because we’re already hurting from a tax standpoint. Everybody in Illinois knows that.

“We have one of the highest real estate taxes in the nation. This progressive income tax that they’re trying to push in November I think is going to be a non-starter.

“I think that’s the only thing that keeps people here is high income earners have a flat tax. … That keeps businesses here. A progressive tax would give them uncontrolled access to raise the income tax rate to whatever they want, and I think Springfield will abuse that control. You don’t want to drive the wealthy out of the state because then you won’t have as many citizens to tax to bring in income. It’s that simple. They need to focus inward as a state and not look for more taxes to solve their apparent spending problem. Balance the budget, reform pensions.

“A similar analogy would be if they had $200,000 of credit card debt, they made $60,000 a year and they were spending $2,000 more than what they made each month. It’s probably worse than that, but that’s what an individual would look like if you dumbed it down from the state to an individual level. Personally, I think that person would have to declare bankruptcy.

“But before they consider that, we should at least try things they haven’t even made an effort to do, such as cutting expenses and pension reform. An average person would have to cut their expenses, live within their means, and that’s what Illinois needs to do… at least we’d be heading in a green direction instead of a deeper hole. It would take us a long time to get out of that hole, but that’s what we need to do.

“The lesson learned here from an individual standpoint, and we can relate this back to government, too, but from an individual standpoint you have to have a plan in place for times like this. … We need to have an emergency fund. And if you’re spending every dime you make, and then some, they can’t be prepared for times like this.

“As for advice to clients, don’t make emotional decisions during a down market. Stay focused on the long-term plan you have with your advisor. Look at history. Everybody says this time is different. It’s never different. We’ve lived through a presidential assassination with Kennedy, we’ve lived through SARS, we’ve lived through the housing crisis of 2008. Everybody thought those were times that were different as well. This time’s no different. We’ll get past this.”

Brad Morin
Financial adviser
Lombard, Illinois