While you may not be sick the reality is that a vast number of Americans are being directly impacted from the coronavirus and the subsequent shut down of America. In an attempt to remain positive and in ‘motion’ we found it important to run through some immediate steps you may consider as you face this challenging time. We know that this virus is temporary and the economy will recover. Until then, if you are directly impacted through job loss or a dramatic change in income, consider the following:
1) Credit Cards
The first place to look into saving money is credit card payments. The average American has about 4 credit cards and most Americans live with some level of credit card debt. Many credit card companies have plans to adjust payments, extend deadlines, or lower APRs during disasters. Normally these plans are for things like hurricanes where people can’t make their regular payments but it’s taking the time to reach out to your credit card company and see if they have any options to work with you if you’re struggling to make payments due to the virus’ effects on the economy. Citi has already announced plans to provide assistance to those impacted by the situation including waiving fees and Apple announced there wouldn’t be penalties for certain groups that missed March payments. But these companies aren’t going to offer these services unless you ask and worst case scenario they say no and you’re back to where you were before you called but at least you tried. It also would probably help if you go to them with some sort of plan to begin with, like extending payment deadlines a month, or coming up with an alternative payment plan and definitely remind them of your history if you’ve been paying on time before this.
2) Rent and Mortgage
If you’re a homeowner you can do something similar to dealing with credit cards, reach out to your lender and or bank. This might be even more successful than reaching out to credit card companies and housing is more strictly regulated by the government. The FHFA has already ordered lenders to suspend evictions and foreclosures for 60 days. Plus your lender expects you to be paying them back over a longer period of time already so they have more room to work around problems. Most major banks have already put out statements on the virus and have made plans to work with those affected. If things get really bad you can even look into hardship forbearance, although this isn’t an ideal way to deal with the situation it can help if you’re truly unable to make any payment and meet your lender half way. It should be noted this option won’t be for everyone and you’ll likely need to go through a process of proving it’s specifically due to the recent virus you can’t make your payment. But if you live in one of the more affected areas, like Washington, and have been laid off this may be an option if all else fails.
If you’re renting, reach out to your landlord as soon as possible. Every landlord is going to treat the situation differently and it may benefit you to approach them with a plan already in mind such as skipping a month and planning to pay that month back later over smaller installments. Your landlord is a business person and the last thing they want to do is evict a solid tennant due to a short term circumstance. Open communication and business respect will go a long way. Much like mortgages, many states and cities have announced bans on evictions for a month or two while this goes on and it may be that you’re included in this protection.
3) Work and Unemployment
18% of American households are already losing work in the form of layoffs and reduced hours due to the virus, but this number grew to 25% in households earning below $50,000. A pretty good silver lining, however is that the federal government has expanded unemployment eligibility for the virus. This will be different based on each state, so make sure you take the time to investigate this if you’ve been laid off.
Alternatively consider a temporary job. While many sectors have been significanty impacted, you are probably well aware that delivery is now all the rage. Amazon, for example, has announced the creation of 100,000 new jobs to deal with their new demand for deliveries. Grubhub is seeing a significant increase in user rates and Uber for their Uber Eats segment is another option. Securing a temporary job is something a lot of people hesitate to do, but it’s one of the most straightforward ways to increase your income immediately. Don’t hesitate to take this step if you need to.
Losing your job likely means losing healthcare for many people, which may be worse right now than losing the income. If you have been laid off and lost your health care, it would be a good idea to go to healthcare.gov and seek a special enrollment period due to job loss. You may also apply for COBRA within 60 days of losing your job and it can provide you with healthcare while you find a new job, although it does require you to continue paying your portion of the premiums and your employer’s portion thus it is often a higher rate when compared to a new plan through the healthcare exchange.
Overall the main thing here is communication. It’s unlikely a company will reach out to you and ask you to pay them less but if you reach out to them it can go a long way. It can’t make anything worse. The key to getting through this is staying active and finding solutions to problems. It’s not going to be easy but working together and communicating openly with everyone. America has been through hard times before and we always get through them. If we can survive the Great Depression, WWII, and 9/11 we can get through this and come out stronger than before.