If You’re Facing Financial Hardship, Do These Four Things
While the U.S. economy is gradually reopening, the impact of its prolonged closure will continue to be felt by millions of Americans. From lost jobs to reduced salaries, many people have less money to cover even basic needs for themselves and their families. If you don’t have an emergency fund (or if you’ve already spent it all) and are struggling to make ends meet during these uncertain times, take these four steps now to help minimize the effects of financial hardship.
1. Contact your creditors. First, try to protect the essentials – shelter, food, heat, lights, transportation. After you’ve triaged your priority bills, you’ll need to reduce the fallout from not paying them all. Contact your creditors and ask for hardship concessions. Most credit unions, banks, insurance companies, mortgage lenders and credit card issuers are willing to work out arrangements to help you remain in good standing. In fact, many – including Affinity – are encouraging customers facing economic hardship1 to contact them. Hardship plans may include lower interest rates or smaller fees and penalties for an extended period of time. Many utility companies are also offering energy bill assistance programs that may allow deferred payments.
2. Use community and government assistance programs. It’s not always easy to ask for help but know that you’re not alone. The government continues to implement policies and programs to help cash-strapped Americans during this crisis. But there are already many other resources offered by communities and local and state governments. Social media sites are a good place to start your search for community-based groups providing assistance. Your local municipality can provide information about local resources.
3. Stay safe from COVID-19-related scams. Crises tend to bring out the best in people, but that’s not always the case. Phishers and scammers are out in full force, according to the Federal Trade Commission 2, which reported that consumers have lost an average of $600 from hoaxes, including false vacation refunds, fake test kits and more. This number may rise as scammers try to gain access to stimulus check deposits.
4. Protect your emotional wellbeing, too. Financial distress can have devastating effects on individuals and families, and it’s not all about the money. Stress and fear stemming from the loss of jobs, retirement accounts, savings and more can impact on your mental and emotional health. The Center for Disease Control 3 (CDC) cites several common signs of distressed mental health to look for in yourself or others: anxiety or depression; changes in sleep or eating patterns; difficulty concentrating; worsening of chronic health problems; and increased use of substances. For some of us, it’s not easy to ask for help of any kind, financial or otherwise, but it is important.
If you’re one of the millions of Americans facing unavoidable financial hardships due to COVID-19, stay positive – and proactive. By tapping into available resources and staying vigilant about your financial (and emotional) wellbeing, you’ll avoid making unnecessary mistakes that you may end up paying for long after the economy, and your bank account, recovers.
For additional information and updates from Affinity about COVID-19, please visit https://www.affinityfcu.com/banking/we're-here-for-you.aspx
This information is for informational purposes only and is intended to provide general guidance and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments regarding the matters related to your condition are made.
1 Retrieved from: http://cloud.connect.affinityfcu.com/hereforyou?utm_source=homepage&utm_medium=homepage_banner&utm_campaign=hereforyou
2 Retrieved from: https://www.ftc.gov/news-events/press-releases/2020/03/ftc-data-shows-jump-coronavirus-related-complaints-consumers
3 Retrieved from: https://www.cnbc.com/2020/03/20/coronavirus-tips-for-protecting-your-mental-health-during-quarantine.html