Managing Financial Priorities During Covid-19
Managing Financial Priorities During COVID-19
Keep your finances a priority during a pandemic
The Covid 19 pandemic has taken an emotional and financial toll on this country. We are seeing an unprecedented number of people filing for unemployment and many small businesses will not be able to reopen after this all ends. Households are losing family members that may have been wage earners that have succumbed to this terrible virus.
The Federal Government is making an attempt to help with the Economic Impact Payment. This payment will vary depending on the household income and composition. The maximum amount is $1,200 for an individual making under $75,000 per year, $2400 for a married couple making under $150,000 per year and $500 per child. The hope is that individuals and families will put this money back into the economy, hence the economic stimulus. What should you do with these funds?
Everyone's circumstances are unique. The main focus should be on payment priorities. The first priority everyone should have is housing. Do not expect your mortgage company to just automatically assist you during this time. You must contact them. Every mortgage company is different. Even if the company defers payments for several months, there is no guarantee that you will be offered a modification to put the payments on the back of the loan. The situation is similar with rent. Many states have closed their courts, so by proxy, court ordered evictions cannot take place. This does not mean that rent is not due, it only means that the tenant cannot be evicted until the courts reopen. If you are struggling, apply the funds to housing.
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The second priority would be utilities. Many children are participating in remote learning and adults are working from home. Having electric and internet are critical to completing these tasks. Some utility companies have agreed to keep utilities on regardless of payment, however the full balance will be due at the conclusion of the stay at home orders. Many utility companies are requesting that you contact them and pay what you can, so you do not face a tremendous bill and a shut off order in a few months.
Other priorities including car payments and insurance should be next on your list. You do not want to deal with a car repossession during this time. I do have a suggestion, if you are working from home due to a stay at home or shelter in place order, call your auto insurance company. Many of the auto insurance companies are giving rebates due to us not driving our automobiles.
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One expense many of us have seen increase dramatically is groceries. All around the nation, grocery stores have empty shelves of essentials. For many of us, this has forced us to buy our staple products in more expensive convenience stores. With fears looming around going into grocery stores, many people are paying extra for grocery delivery. The act of ordering groceries online can cause you to spend more money, particularly because you may not be able to find the cheaper store brand and some stores increase the price of the groceries when ordering online. There is the additional delivery cost and tip which can add up quickly. We are also home all day. We eat out of fear, stress and boredom. We may find a higher bill because we are going through food more quickly.
These are the payment priorities I would suggest utilizing the stimulus funds for, if you are experiencing a hardship as a result of the pandemic. If you have not been affected, I suggest saving it. We have no idea how long this will last and none of us can predict the future of our employment status or potential medical needs. While it is not a lot of money, it may serve you well if your situation changes.
Navicore Solutions is fully functional at this time. Our national hotline, 1-800-992-4557, will bring you directly to a certified counselor who can discuss your financial situation with care and compassion. We are providing financial counseling, housing counseling and credit counseling. If you are struggling during this time, please reach out to us, and please stay healthy and safe.
Kim Cole is the Community Engagement Manager for Navicore Solutions. Kim provides financial education workshops and seminars to communities. Readers can submit general questions relating to personal finance, credit scoring, debt management, student loans, home finance or bankruptcy which may be highlighted in the next month's edition. All identifying information will be kept anonymous.
Please send your questions via email to DearKim@navicoresolutions.org