Money worries were among the most common causes of stress long before the pandemic hit. With many families finding it increasingly difficult to stay in the black, debts and anxiety levels are likely to rise in the coming weeks and months. If you’re struggling to make ends meet, or your circumstances have changed, here are some tips to help you turn things around.
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Try to reduce debt, rather than adding to it
Reducing debt is easier said than done, especially during a pandemic when people are losing their jobs and the future looks uncertain. Tackling debts is beneficial because it saves money in both the short and long-term. Many people who are in debt pay huge amounts of interest on credit cards and short-term loans each month. This money could be used to cover essential costs or boost a savings fund. If you have a bit of money left over each month, try and use it to gradually pay off your debts, reducing interest payments and eliminating the risk of penalties linked to missed payments. If you’re finding it hard to make ends meet, explore other avenues before adding to existing debts. Spending on credit cards and taking out loans from multiple providers can cause debts to spiral rapidly. It may be possible to take out a loan on a long-term basis with lower repayments and interest rates, to borrow from family members or close friends, or to take advantage of initiatives like payment breaks, which are available to help those impacted by the Covid-19 crisis. If your debts are getting out of hand, don’t hesitate to seek advice. There is help and practical support available, and there is always a way out, no matter how much money you owe.
Financial support and targeted assistance
There are many reasons why people find themselves in a situation where it’s difficult to pay the bills and keep up with repayments. Unemployment is a common cause of financial problems. Whether you’ve lost your job due to Covid-19, or you can’t work because of an injury or a chronic illness, or a disability, it’s important to ensure that you are aware of any programs, schemes, or initiatives that could benefit you. There are measures in place to provide financial assistance for those who cannot work, and it’s beneficial to seek expert advice to make sure that you understand the difference between SSDI and SSI and that you are aware of the eligibility criteria. It’s also wise to explore support schemes or incentives that are available during the Covid-19 crisis for people who may be struggling to pay their rent or mortgage or cover credit card or loan repayments. Seek expert advice, look for information on reputable sites online, and don’t be afraid to reach out if you need guidance or you’re not sure whether you qualify or not.
Reducing spending
The first step to rebuilding stability when your financial situation deteriorates is to reduce spending. Many of us spend money on things we don’t necessarily need or even want, and we lose track of where our money goes every month. If you need to save money and tighten your belt, carry out an audit. Analyze your bank statements and write down all your regular outgoings. Look for expenses you can either decrease or cut out altogether. Are you paying for a gym membership you never use, or did you sign up for a free trial for unlimited movies or monthly wine delivery and forget to cancel it? Cancel subscriptions and memberships you don’t use and then turn your attention to bringing costs down. If you usually spend $100 on a weekly grocery shop, start making lists of products you need and aim to spend less each time. Resist the temptation to add anything that isn’t on the list to your cart and keep a running total as you shop. Compare prices and offers online when buying or renewing insurance. If you have auto, health, home, and pet insurance, for example, the chances are that you’re spending a substantial amount of money on protection each month. Instead of renewing your existing policies or snapping up the first deal, you see for a new plan, use the Internet to compare policies and providers. Often, insurance companies reserve their best offers for new customers to lure them away from competitors. If you renew automatically every year, you could be paying more for less.
Exploring additional income streams
Many people are finding it hard to secure a steady income at the moment. If you’ve lost your job, or your workload is smaller than usual and your income has dropped, explore alternative streams. Have you got a hobby or a talent you could utilize to earn extra cash, have you got items at home you could sell, or have you been thinking about setting up a side hustle for a while? From blogging and online tutoring to painting, baking, or helping people out with gardening or general maintenance, there are lots of ways you can boost your earnings. If you’ve lost your job, you could also consider the possibility of going freelance or looking for a temporary job. It is also worth browsing opportunities with businesses or organizations that have experienced a sharp increase in sales or demand for services during the pandemic. Delivery drivers and warehouse workers, for example, are in high demand as a result of soaring online sales.
Most of us long to enjoy financial stability, but it can be incredibly challenging to achieve this, especially in the midst of a global health crisis. If you are struggling at the moment, or you’re worried about financial security in the future, there is help available. Don’t hesitate to reach out if you’re concerned about debts or you’re unsure whether you’re eligible for financial assistance. Keep an eye on spending and try to lower monthly expenses and consider other income streams if you’ve lost your job or you want to earn more. The sooner you take these steps, the sooner you can start strengthening your financial situation.