4-step success checklist in managing your finances during pandemic

*It is imperative to take stock of where you are. Take steps to safeguard your physical, emotional, financial health, and reach out if you need assistance

Alexander Davis | ConsumerConnect

It is a fact of life that times of crisis can bring uncertainty for many reasons, and the current novel Coronavirus (COVID-19) pandemic is no exception.

Whether you have experienced a change in your financial situation because of layoffs, reduced hours or wages or through increased medical expenses, it is imperative to take stock of where you are, and make a plan to ensure financial success now and in the future.

First is the need to check eligibility for support many organisations are offering support to those impacted by the Coronavirus.

Knowing where to go for help, what to ask, and how to document your situation is significant to successfully managing your finances and recovering once the crisis is over.

Below are four steps to help you in managing your money during and after this pandemic, courtesy of www.military.com:

1. Analyse available resources: If there is one upside to the current situation, it’s that many programmes are being offered to help consumers stay healthy, both physically and financially.

Identify all available resources and take advantage of those that fit your needs. Beyond any savings you may have put aside for emergencies, community resources, like the ones below, could help you bridge a temporary income gap:

For instance, in certain economies around the world, military relief societies are offering grants or zero-interest loans for service members affected by coronavirus.

You could contact Army Emergency Relief, Air Force Aid Society, Navy-Marine Corps Relief Society, or Coast Guard Mutual Assistance for more information.

Depending on your situation, you may qualify for unemployment benefits. Check with the Department of Labour in your state for eligibility criteria.

Many banks and financial institutions are offering to help consumers impacted by the coronavirus. Contact your individual lenders to find out what is available to you.

Many school districts or authorities are also providing free meals for children at school pick-up locations or bus stops. Contact your local school to find out whether this is an option where you live.

National and local service providers have a variety of assistance options, from payment plans to free services.

2. Create a priority-based spending plan: Once you have identified resources you qualify for, evaluate your budget and create a priority-based spending plan.

You could consider all sources of available income and make a realistic list of your expected monthly expenses, prioritising the “must-haves.”

These are things such as rent or mortgage, food, utilities, insurance, transportation and medication. Then, do the math.

If your adjusted income adds up to less than your total monthly expenses, anything that is not a priority item will need to be deferred as much as possible until the crisis is over and your financial situation changes.

3. Contact your creditors (if any): If you cannot meet all of your financial obligations, contact your creditors to ask for assistance.

Some programmes are already in place to help stop evictions and foreclosures, so whether you are a renter or homeowner, contact your landlord or mortgage servicer right away to ask for help.

The same goes for providers of automobile, student and personal loans, including credit cards.

Creditors might offer reduced payments and fees, deferred payments through forbearance, or other hardship plans.

When you talk with your creditors, be sure to take notes. Write down key things such as the date and time of your call; the name of the representative you spoke with; what you were offered; how information will be reported to the credit bureaus; and the plan you ultimately agreed on.

Once you agree on a plan, you can put together a letter summarising your discussion and mail it to the creditor.

Then, monitor your monthly statements to be sure you are receiving the assistance you discussed.

4. Recover strong: Although it is difficult to think about future emergencies when you are in the middle of a crisis, consider making a financial recovery plan for once things get back to normal so that you are prepared to handle the next emergency that may arise.

Once you are back on your feet, revisit your monthly budget and commit to regular savings to build or rebuild your emergency fund.

Start gradually and set a goal to save like $1,000; then keep saving until you have three months of your living expenses saved to manage future emergencies.

If you have a debt to pay, consider implementing a rapid repayment plan to pay it down or consider talking with a credit counsellor, or consultant to see if a debt management plan is right for you.

And please remember, these are unprecedented times, and although you may feel alone, everyone is affected by the current pandemic.

In all, take steps to safeguard your physical, emotional, and financial health, and reach out if you need assistance.

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