By: Ellie Burgueño
As COVID-19 is making us change our entire lifestyle and making headlines around the world on a daily basis, it’s normal to feel uncertain about many aspects of life right now, including your money. Even if you don’t catch COVID-19, you could be financially impacted by the fallout.
Your priority during this time of crisis should definitely be staying healthy and protect your family as well. However, maintaining your personal financial health during this situation can be critically important. If you create a strategy to handle your money efficiently during this pandemic, you’ll be prepared for whatever life throws your way in the coming weeks and keep stable through the rainy days.
In the United States, most people were fortunate to receive a financial stimulus to help them support their households during this time of crisis, but whether you received it or not, you urgently need to learn how to manage your money in the better possible way. This is a matter of survival.
SAVING YOUR MONEY.
Keep saving your money if you don’t have at least a 6-9 month emergency saving account. An emergency fund is a type of savings account that can help you cover large, unforeseen expenses like having to fix a flat tire or to afford an urgent dental procedure. It can also help you cover regular expenses if you lose your job.
PAYING DOWN YOUR DEBT.
Usually, debt should be a high priority, but right now, with so many lenders providing relief, if you lack savings, a better move is to call each lender and ask about possible payment deferments and other allowances to give you some wiggle room in your budget, and allow you to bank that monthly debt payment into a savings account.
ADJUST YOUR BUDGET.
Adjust your budget if your income is disrupted. Set up money dates with yourself and your partner to review your budget. Think about your outflows and your inflow and how you can make adjustments to avoid spending as much as possible.
YOUR RETIREMENT SAVINGS STRATEGY.
If you can, continue with the course when it comes to your retirement savings strategy. If you’ve been contributing to your workplace 401(k) or IRA, stick with it if you can. If you lack emergency savings of at least six months, then focus on building up that cushion first before investing. It’s important to save and prepare for times of crisis if it’s within your possibilities.
SMALL BUSINESS OWNERS.
If you are a Small Business Owner it’s likely you’ll find it difficult to keep your small business cash flow healthy and as a result, your personal finances during the COVID-19 outbreak. Most small businesses will still need extra financial help. Fortunately, there are a number of local, state, and federal assistance programs launching to help small businesses deal with the fallout from the COVID-19 outbreak. Keeping your small business cash flow as healthy as possible during the COVID-19 outbreak is a challenge. Check out all possible resources for more helpful information for small businesses.
One potential impact of the current situation is that you could be required to stay home for weeks at a time. With that, you may lose your income for that period if your employer doesn’t offer paid leave or the ability to work from home. Instead of panicking, focus on finding ways to stretch your money farther.
Cut nonessential spending from your budget. Since you’ll be staying at home more, you’ll likely be able to easily save money that would have been spent eating out, traveling, or commuting to places. Be cautious and use your money wisely.