This is a guest post by Aiden White.
The whole world is fighting an intense situation due to the current pandemic. People all over the world are trying to maintain the necessary guidelines dictated by the Government and doctors and the main concern is to stop spreading the COVID-19 virus to save lives.
However, it is also true that due to this pandemic, our economic condition has also been affected. We are heading towards a shattered economic situation.
Well, this is not the time to think negatively, we should take proper precautions to avoid spreading coronavirus. We should also try our best to maintain our financial health during this time.
We all know how to take care of our health and what safety measures should be followed to avoid the pandemic spread. But, do you know how to maintain your financial health during this stressful situation? If your answer is no, then read on.
1. Cut down on costs related to luxury expenses
You should be financially well prepared for the worst situation. So, you should be very careful about your savings.
So, this time, you should cut down all the costs related to the luxury lifestyle. By doing this, you can set aside a noticeable amount of money.
This time, you should buy the things that you need most. Try not to pamper yourself by spending money on your wants.
2. Reassess your budget to eliminate unnecessary expenses
You have to revisit your budget and assess it while keeping this pandemic situation in mind.
Include only the necessary expenses in the budget like food, equity, medicine. To create an emergency budget, you need to have a clear idea of your usual expenses. To understand your monthly expenses, you can check your old credit card statements. Thus, you should try to create a budget with credit cards to make the budgeting process easier and hassle-free.
If you are staying at home due to the lock-down announced by the Government, then you can easily save the cost of fuel or transport.
Try to save that money in your emergency fund to become financially strong for the bad times.
3. Avoid increasing debt unnecessarily
If you don’t want to see yourself drowning in poor financial condition, ten stay away from new debt. This is not the time to use credit cards randomly. Before swiping your credit card, you should be very careful about the thing you are buying and the bill that you have to repay within the stipulated time.
If you don’t do this instead you use your credit card to stock a huge amount of paper towels and forget about repaying the bill, then your credit score will surely suffer next time.
You will be in deep debt and probably will not be in the situation to repay the debt.
So, mind your credit card usage.
4. Try to make only the minimum debt payments if you can
If your employer is giving you a salary this time, then try to pay the minimum on your credit card balance to avoid fees and extra interest.
If you have no earnings right now, then you should contact your card issuer to let them know about your financial hardship and missed payments.
If you have a good credit card payment history, your credit card issuer can offer you some relief.
5. Avoid payday loans and cash advances
Remember, you shouldn’t increase your debt obligation during this pandemic situation. These times, you will see many advertisements for cash advances to relieve your money needs.
But try to avoid these kinds of predatory lenders. They might be illegal lenders or tribal lenders who can give you money with a huge interest rate. They can also ask you for the bank details so that they can take away all the money from your bank.
So stay away from payday lenders at this time.
6. Cut down on unnecessary energy consumption
Try to do a utility audit, taking into account on-property lighting, HVAC, insulation to improve your energy consumption. If possible, use energy-efficient light bulbs only. Use ‘smart-room’ energy-saving automation, timers on lighting, and occupancy sensors to reduce utility-related costs.
7. Cut down on membership and subscription expenses
Since you are staying at home and not utilizing any kind of membership like gym, club, swimming pool access membership, you shouldn’t avail of these anymore for the time being.
You can talk to the owner of the gym regarding this and you can close your account. If you have subscribed to any paid membership online, then you can also unsubscribe from the service to save money.
This will help you to save a significant amount of money this time.
8. Cut down on vacation planning costs right now
Since there is no update about the end of this pandemic, you shouldn’t make any plans for vacations or tours. Don’t pre-book with any hotel, airline, or travel agency for a trip
Instead of planning for a future vacation, save that money so that you can manage the living costs for a long time while staying at home without work.
9. Searching for an online job
Since you can’t go to your workplace, you can have enough time for doing an online job. If you are not assigned to work from home, you can search for an online job to earn some money.
This will help you to manage the necessary household costs during this coronavirus pandemic time.
10. Send hardship letters to your lenders
If you don’t have a job right now, then you should send temporary hardship letters to your mortgage lenders.
According to the National Consumer Law Center, you can send hardship letters to lenders, like your mortgage company, to see what their options are regarding your non-payments.
11. Consider reusing and upcycling
To survive during an unconventional and sudden pandemic time, you should consider a frugal lifestyle. Try to embrace the reusing and upcycling method to cut costs.
For example, if you have children at home, then use cotton clothes as their diaper instead of buying bundles of store-bought diapers.
You should also use water instead of toilet paper at the loo.
Try to make your own mask using clean clothes instead of buying a costly mask from the store.
You can also make a hand sanitizer on your own. Search online for DIY recipes available there.
Remember, moving out is not safe now. Thus, you should manage your living style in a safe way. This way you can save some money as well.
Lastly, don’t forget that this time will surely be over. So, don’t panic, instead, stay updated and stay prepared. Follow all the rules that are told and manage your money properly to survive during this pandemic time. One day, this hardship will definitely end and you will find a new path of living. Good luck!
About the Guest Post Author:
Aiden White is a financial writer who lives in Dudley, Massachusetts. She started her financial journey in 2015 and has been associated with consolidatecreditcard.org for the last 2 years. Through her writing, she has inspired people to overcome their credit card debt problems and solve their personal finance based queries. Being a debt fighter in her personal life, her goal is to share innovative thoughts and knowledge in the debt communities.