Times are unsettling for millions of Americans facing reduced hours, changing work functions, and uncertain financial days ahead. With COVID-19 spreading, it’s more important than ever for you to take the reins over your finances and manage them carefully to make your money work for you despite the uncertainty all around. These key ideas can help.
Assess Your Current Financial Situation
The more facts you have at your disposal about your current financial situation, the better position you are in to craft a plan that works for you and your family moving forward.
If you are off work due to COVID-19, as many people are, talk to your employer about pay. For instance, does your employer intend to pay you, in some capacity, during this downtime? If so, how much? If not, will you qualify for unemployment benefits?
In addition to learning about your compensation from your employer, review your regular expenses, account balances, and upcoming bills along with your current savings. Now may very well be the rainy day you’ve been saving for. If you do not have a household budget, now is the time to create one to work within the weeks and months ahead. Create and track your budget using our free personal financial management tool My Budget Manager inside Online/Mobile Banking.
Focus on Essential Expenses
Much of the uncertainty related to COVID-19 is the fact that you don’t have all the information — no one does. No one knows how long the outbreak will last, the impact it will have on the world, or what it will mean for your workplace moving forward. During this time, it’s wise to focus your spending on essentials only.
Begin this process by identifying which expenses are essential, such as mortgage or rent, food, utilities, medical expenses, etc. and which are non-essential expenses. Identifying non-essential expenses means pinpointing areas where you can cut costs.
First, and most importantly, resist the temptation to shop online out of boredom or depression. These activities can be destructive to your budget. Second, begin looking for other ways to cut expenses. Subscription services, which can add up quickly, are a great starting point. However, also consider expenses you likely will not utilize soon, such as gym memberships, amusement park annual passes, and other entertainment expenses.
There are areas where you can cut back on expenses even at the grocery store – at least once the initial panic buying ends. For instance, think of buying food in bulk or larger quantities to not only save money but to save trips to the grocery store. Many libraries, schools, and other companies are stepping up and offering free streaming services to keep young children entertained during this trying time. Take advantage of available free services.
Contact Us - We’re Here to Help
With all the uncertainty related to COVID-19 and what it means for the world’s economy, you may have anxiety on many fronts, including your finances. We know we can’t fix the world’s economy, but we may be able to help you better manage your finances during the weeks and months ahead.
Give us a call at 800-336-6309 to learn about the relief services we’re offering that may help you weather the impacts of this financial storm.
Each individual’s financial situation is unique and readers are encouraged to contact the credit union when seeking financial advice on the products and services discussed. This article is for educational purposes only.