How to take control of your finances during COVID-19

How to take control of your finances during COVID-19

Due to COVID-19, most of the country is trying to power through these difficult times where people are experiencing extreme financial difficulties.

Many are spending a lot of time at home, depending on the various degree of quarantine regulations in place in their state.

This leaves you with a lot of time to think and introspect on the most important parts of your life. As of right now, the top priority is, and has to be, keeping yourself and your loved ones safe and healthy. However, your finances ought to be one of your priorities, too.

While there is plenty of conjecture over how the pandemic is likely to impact the global economy, the actual impact will be felt when it will be felt. In fact, we’ve already started to see the negative impact from a financial perspective.

Many are wondering if COVID-19 is marking the start of a global recession, and how their own finances will be affected by the slowdown. What happens if your credit scores take a hit? What if the economic recovery is slow? How does the pandemic affect your investment portfolio? How can you take control of your finances during COVID-19?

Let us look at how you can prepare your finances and stay calm during this crisis.

Stop worrying about your credit score

The pandemic is affecting everyone adversely, both businesses and individuals. If you are experiencing financial problems and are finding it difficult to make timely payments due to COVID-19, you might be worried about the havoc that late/missed payments are wreaking on your credit score.

It is important for you to take a step back and stop stressing out. A small impact on your credit score during an economic crisis is more acceptable than a ding when the economy is stable. This is just the beginning of the economic crisis and although, we want to be optimistic, it’s important to remember that you are not alone.

Explore debt relief options

Instead of worrying about your credit score, channelize your energy toward exploring debt relief options.

Rest assured, that there are multiple relief alternatives that you can apply for. Contact your creditors and lenders to check if there are any options that they could offer to you.

In general, lenders have control over deferring mortgage payments, allowing you to skip payments, revising terms or interest rates of your loan, or giving you an extension on your loan. What they do end up offering you depends largely on your overall financial behavior in the past, your payment history, as well as how quickly you reach out to them.

A key factor to take control of your finances during COVID-19 is the elimination of debt. It is normal to feel worried about options you have not used before. Not only is debt elimination legal, it is even more acceptable during an economic crisis given that even the wealthiest and financially strong minds can sometimes suffer great financial losses during these times. If you are not getting help from your creditors, contact us to explore your options.

Know who to trust

In trying financial times like these, it is difficult to figure out whom to trust when it comes to getting sound financial advice for yourself and your loved ones. It is important to not get confused with the loads of information out there. It is also essential that you do not believe everything available on the Internet. If you do go to the web, look for reputed sources and government sites to get the right information.

At MPowering America, our experts understand the current climate and your financial fears. A sound financial education will allow you to find and choose the right debt relief options for yourself. Let us help you put an end to your fears, so you can take control of your finances in these uncertain times – NOW is the time to act.

Save what you can

Create a spending plan that prioritizes saving resources and finding new ways to save. Make a list of all your expenses and use the PERK system – Postpone, Eliminate, Reduce, Keep. Mark each expense and prioritize so you can work out which ones you will or will not be able to pay this month.

Many utility companies and establishments are allowing users to defer payments or extend payment dates during this financially stressful time. Look at your expenses to isolate services you don’t really use but pay for month after month like extra television channels or other home services. Contact your service providers as soon as you can to make arrangements if needed.

Pay what you can

It’s always a good idea to avoid late payments and defaults on your credit reports. But we know that given the current economic situation, that’s easier said than done. Make the minimum due or whatever amount you can on your accounts. It is a good idea to speak to your creditors about how much you will be able to pay, especially if the amount is lower than the minimum payment on the account.

You can safely pay the amount your lender/creditor and you have agreed upon. If this is not an option, you may want to look into using MPowering America to assist you in choosing the debt elimination strategy that is right for you based on your unique situation.

Stay away from cheap credit offers

During such financial mayhem, the need to have more money is real, and so, the temptation of borrowing at historically low rates just to shore up your account is at an all-time high. While there may be a lot of cheap credit offers out there, avoid this temptation as much as possible. If you sign-up for anything, seek financial counselling and ensure that you understand the fine print properly.

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Matt Lovelady is a co-founder of MPowering America. He is a financial expert who has been in the financial services industry for over 22 years. Matt is dedicated to educating people on how to increase their income and reduce their debt.