When the novel coronavirus, COVID-19, spread across the globe, business owners and their staff went into panic mode. Stay-at-home orders meant companies had to close their doors, and that ultimately caused the closing off of income streams. Even in the wake of a significant financial crisis, there are ways you can soften the blow. Check out these strategies for bolstering your finances.
Table of Contents
Tap into Loan Initiatives
There may be a period of time where a lack of income causes hardship, and an inability to pay bills. In that instance, you may wish to consider a no-interest loan scheme to help you through the challenging patch.
Given that the loan has no interest attached, all repayments in the weeks and months following will be principal. This will allow you to pay down the amount you borrow faster than if you were to reach out to your bank for help.
Take Government Help
Many people can feel too proud to accept help from others. Still, it’s worth considering the government’s offer of $1,200 cash injection for individuals, and $2,400 for married couples. These stimulus packages are available for all Americans.
Unemployment benefits are also on offer for those who have lost their jobs, with additional payments above standard offerings for up to four months. If you’re not sure what you’re entitled to, ask your local government spokesperson for assistance.
Look at Mortgage Deferment
In a worst-case scenario, some people might be struggling to meet their mortgage repayments. The average median monthly mortgage payment in the US is $1,100, which can be quite a substantial amount for any family who has lost a source of income.
Fortunately, many mortgage lenders are more than accommodating during the COVID-19 outbreak and may be able to offer mortgage deferment for up to 120 days.
Slash Your Spending
Now, more than ever, it’s crucial to look at non-essential spending with a critical eye. Even small changes can have a beneficial impact during these tough times.
Put those cable TV subscriptions on hold, and be leaner with your grocery store spending. Go through your outgoings with a fine-tooth comb to determine if you can put any payments on hold until after your household begins earning again.
Slashing your spending may not be the most desirable option. Still, it may be necessary if you want to make sure you don’t exhaust your current cash levels at a rapid speed. Remember to check your credit card statement for any automatic payments you might need to cancel.
Plan for the Future
No-one would have anticipated that a global pandemic would affect us in our lifetime, but here we are. While finances might be tight, it’s worth thinking about emergency funds and savings accounts for future situations that might require them.
Currently, 69% of Americans have less than $1,000 in savings. While living paycheck to paycheck is the reality for many, others simply don’t set aside money for a rainy day.
When your income stream steadies itself, and you’ve taken onboard various ways to cut costs, it’s worth looking at saving schemes. By having a rainy-day fund, you are putting yourself in a desirable situation should you find yourself with cash flow issues in the future.
The COVID-19 pandemic knocked the world for six, but it allowed us to evaluate how we live our lives and how we manage our money. Ask for help when you need it, and even consider mortgage deferment if it’s something your financial institute offers. Support is available in many different ways, so don’t be afraid to reach out.