In late January 2020, COVID-19 began to spread across the United States. Not long after, schools and businesses closed their doors and people were required to stay home to slow the spread of the deadly virus. More than 16 million people lost their jobs and others have been forced to work reduced hours, limiting their take home pay. For families facing financial hardship during this pandemic, paying bills is more difficult than ever. Here, we’re going to provide some insight on tips for paying bills during the coronavirus shutdowns and how, with the right strategy, you might be able to stay afloat even if you’ve lost your job.
Evaluate Your Budget
Any time finances are tight, the first thing you should do is evaluate your budget. Look at your daily, weekly, and monthly spending to see where you can limit unnecessary purchases. Restaurant and non-essential business closings naturally eliminate one category of spending. Other areas where you might be able to limit spending include:
- Gym memberships
- Cable bills
- Monthly subscriptions
When creating your new budget, it’s wise to take those areas of spending and apply them to areas where you might need to spend extra – such as groceries. Due to the uncertainty of the virus and the impact it will have long term on the economy, it’s also a good idea to save funds if you can.
Take An Inventory of Your Debts
While evaluating your budget, it’s essential to evaluate your debts. If you’re furloughed from your job or forced to take reduced hours, repaying your debts might become difficult. Knowing how much you owe and the bills that are most important to pay first is beneficial.
The CARES Act, a $2 trillion stimulus relief bill, signed into effect in March 2020, provides monetary assistance for those facing financial difficulties. One of the most significant benefits of the bill is student debt relief. From March-September 2020, all federal student loans are automatically enrolled in forbearance. During this time, no additional interest will accrue and no borrowers are required to make payments.
Spend Your Emergency Fund Wisely
Having an emergency fund when times are difficult is essential. During uncertain financial times, it’s imperative to control your spending – especially when it comes to spending your emergency fund. If you do not have an emergency fund, the stimulus relief package might provide you with a chance to obtain one. Under the CARES Act, every person with an annual income of $75,000 or less will receive a $1,200 check from the United States government. Likewise, married couples with an income of $150,000 or less will receive $2,400 and an additional $500 for every child or legal dependent. Any person who has not lost their job can use the stimulus payment to start an emergency fund, pay their regular monthly bills, or pay down their debts.
Talk To a Debt Settlement Lawyer About Your Options
The recent pandemic isn’t the first time people across the United States have struggled with student loan debt. If you’re one of the more than 44.7 million individuals who are coping with student debt, you need to know you have options. McCarthy Law PLC is a trusted source of legal representation for debt settlement cases. We want to help you erase your debt, restore your credit and get your life back.
Our process is to walk you through a free case evaluation where you tell us about your unique situation and we discuss what your options are. To schedule a free case evaluation and learn your options, call our office at 855-976-5777 or fill out our online contact form today.