As we navigate these challenging times, we are all likely experiencing worry over the disruption in our daily routine, uncertainty about what the future will hold and general anxiety about the things we just can’t control. A common area of fear for most of us revolves around finances. How can we continue to take care of our needs while being proactive in terms of cutting back on spending and responsibly managing our finances during these uncertain times? One way to minimize anxiety and lessen the negative impact on your life is by being informed and by being prepared with a plan of action. The following are steps to help you focus on what you can do to have as much financial stability as possible during uncertain times.
1. List your priorities. During difficult times, you need to separate your needs from your wants to make sure you have enough money at the end of the month.
- Focus on taking care of your needs. Determine how much money you will need to cover the necessities like food, utilities, shelter, and transportation. Then make a budget to gain a clear picture of your financial situation.
- Put your wants on hold. Start by canceling unnecessary spending such as memberships/subscriptions, cable, and ordering carry-out. When you have to shop, first check what supplies you have and then make a list of what you need and stick to it! This will help you avoid stress purchases.
- Stop using your credit cards. You want to avoid going further into debt. Paying with credit can give you a false sense of security, creating the illusion that you have money to spend. It’s important to remember that it all has to be repaid at some point with interest, so what you buy now will cost you more later!
2. Contact lenders. If you’re not able to pay your bills on time, contact your lenders to let them know about your situation. Credit card companies and lenders may be able to offer you a number of options from waiving certain fees like ATM, overpayments, and late fees to allowing you to delay, adjust, or skip some payments. When contacting your lenders, be prepared to explain:
- Your situation
- How much you can afford to pay
- When you’re likely to be able to restart regular payments
- In the case of mortgages, be prepared to discuss your income, expenses and assets
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3. Pay only the minimum amount due on your credit cards. When money is tight, it is ideal to have more cash on hand to cover necessary expenses. By making only minimum payments, not only will you be able maintain a good credit history, but you’ll have the ability to ride it out for a time and after everything rebounds, refocus on paying down your debt.
4. Seek supplemental income. Find a job that you can do in addition to your full-time job—maybe a few days a week or after your normal work hours—that might bring in extra income and thus reduce some of the financial angst and worry. (Provided you can do so safely and within state/health guidelines.) Here is how you can start:
- Assess your skills. You probably have learned new things and gained experience at your current job. Think about what skills and knowledge might be applicable to a wide variety of jobs.
- Market a hobby or skill to make extra income. Maybe you are a great cook and can make dinners for busy families, or you work in the accounting field and can offer tutoring services. Be creative and think of ways you can make money by doing things you are already good at.
- Take advantage of today’s service apps. People are using Rover, TaskRabbit, and Shipt—just to name a few—to hire dog walkers, get DIY projects or deliveries done, and request grocery shopping services. The best thing about using these apps is the flexibility they provide; you can work as much or as little as you want.
It is hard to predict the future and know how things will evolve, so take a moment to breathe in and focus on what you can control. By creating a plan, prioritizing your actions and even getting a little creative with a side gig, you may help ease your anxiety now and develop a long-term plan for a future filled with financial stability.