Managing Financial Priorities During Covid-19 (2024)

4/14/2020

Managing Financial Priorities During COVID-19

Keep your finances a priority during a pandemic

The Covid 19 pandemic has taken an emotional and financial toll on this country. We are seeing an unprecedented number of people filing for unemployment and many small businesses will not be able to reopen after this all ends. Households are losing family members that may have been wage earners that have succumbed to this terrible virus.

The Federal Government is making an attempt to help with the Economic Impact Payment. This payment will vary depending on the household income and composition. The maximum amount is $1,200 for an individual making under $75,000 per year, $2400 for a married couple making under $150,000 per year and $500 per child. The hope is that individuals and families will put this money back into the economy, hence the economic stimulus. What should you do with these funds?

Read More:How To Survive And Thrive During The Lockdown

Everyone's circ*mstances are unique. The main focus should be on payment priorities. The first priority everyone should have is housing. Do not expect your mortgage company to just automatically assist you during this time. You must contact them. Every mortgage company is different. Even if the company defers payments for several months, there is no guarantee that you will be offered a modification to put the payments on the back of the loan. The situation is similar with rent. Many states have closed their courts, so by proxy, court ordered evictions cannot take place. This does not mean that rent is not due, it only means that the tenant cannot be evicted until the courts reopen. If you are struggling, apply the funds to housing.

One expense many of us have seen increase dramatically is groceries. All around the nation, grocery stores have empty shelves of essentials. For many of us, this has forced us to buy our staple products in more expensive convenience stores. With fears looming around going into grocery stores, many people are paying extra for grocery delivery. The act of ordering groceries online can cause you to spend more money, particularly because you may not be able to find the cheaper store brand and some stores increase the price of the groceries when ordering online. There is the additional delivery cost and tip which can add up quickly. We are also home all day. We eat out of fear, stress and boredom. We may find a higher bill because we are going through food more quickly.

These are the payment priorities I would suggest utilizing the stimulus funds for, if you are experiencing a hardship as a result of the pandemic. If you have not been affected, I suggest saving it. We have no idea how long this will last and none of us can predict the future of our employment status or potential medical needs. While it is not a lot of money, it may serve you well if your situation changes.

Read More:Maintaining Financial Stability Through COVID-19

Navicore Solutions is fully functional at this time. Our national hotline, 1-800-992-4557, will bring you directly to a certified counselor who can discuss your financial situation with care and compassion. We are providing financial counseling, housing counseling and credit counseling. If you are struggling during this time, please reach out to us, and please stay healthy and safe.

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Kim Cole is the Community Engagement Manager for Navicore Solutions. Kim provides financial education workshops and seminars to communities. Readers can submit general questions relating to personal finance, credit scoring, debt management, student loans, home finance or bankruptcy which may be highlighted in the next month's edition. All identifying information will be kept anonymous.

Please send your questions via email to DearKim@navicoresolutions.org

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Managing Financial Priorities During Covid-19 (2024)

FAQs

What is a big financial lesson people can learn from the COVID-19 pandemic? ›

Lesson 1: You might need to put away more in your emergency cash reserve. Building an emergency fund may seem like a tired talking point, but if you hear it all the time, it's because it's such an essential component of financial preparedness.

How has COVID-19 affected financially? ›

The crisis had a dramatic impact on global poverty and inequality. Global poverty increased for the first time in a generation, and disproportionate income losses among disadvantaged populations led to a dramatic rise in inequality within and across countries.

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How has the COVID-19 pandemic affected the operations performance of specific financial institutions? ›

The findings indicate that the COVID-19 outbreak adversely impacts bank performance and stability. More specifically, we find that bank performance and stability are most negatively affected by the COVID-19 outbreak in smaller, undercapitalized, less diversified, foreign, and government-owned banks.

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Did people save money during COVID? ›

According to estimates from economists at the Federal Reserve Bank of San Francisco, excess pandemic savings peaked at $2.1 trillion in August 2021 and finally ran out in March of this year.

What lessons did COVID teach us? ›

“The lessons we have learned from the COVID-19 pandemic underscore the importance of implementing effective policies to improve food environments, encourage physical activity, and protect the health and well-being of families.

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How COVID-19 changed our saving and spending habits? ›

Nearly one-third of those surveyed by The Balance said they were saving more now than before the pandemic, and one-fifth even managed to invest more.

How has the pandemic changed people's way of banking? ›

The pandemic accelerated the shift to digital banking as opposed to traditional visits with bank tellers and lenders. We do more banking on our phones, and it's expanded from simple tasks like checking a balance to all sorts of things, such as transferring money to accounts and paying mortgages.

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How has COVID-19 affected the US economy and financial markets? ›

Financial market trends since COVID

Wall Street experienced its worst year since 2008's Great Recession. The S&P 500 index fell 19.4%, and the Down Jones Industrial Average fell 8.9%. Tech stocks were some of the worst performers, down between 22% and 66%.

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How has the COVID-19 pandemic impacted health and economy globally? ›

The pandemic is exacerbating poverty and inequality

The pandemic, which is disproportionately hurting low-skilled, low-wage jobs, while leaving higher-skilled jobs less affected – will further widen income inequality within and between countries.

How did COVID-19 affect people economically? ›

The COVID-19 pandemic precipitated a devastatingly sharp contraction of economic activity and huge job losses in early 2020, as government restrictions and fear of the virus kept people at home and businesses shut.

How much money was lost during COVID? ›

The estimated cumulative financial costs of the COVID-19 pandemic related to the lost output and health reduction is shown in Table 1. The total cost is estimated at more than $16 trillion, or roughly 90% of annual GDP of the United States. For a family of 4, the estimated loss would be nearly $200,000.

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What are good things about COVID pandemic? ›

Positive aspects of the COVID-19 pandemic

The most commonly reported positive impact of the COVID-19 pandemic was improved relationships (16.9%), Fig. 1B. Reasons for improved relationships included spending more time at home and more quality time with loved ones.

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How did the COVID-19 pandemic affect learning? ›

The 2022 PISA results reveal that the COVID-19 pandemic had substantial effects on education systems around the globe. As shown in Figure 1, the OECD as a whole saw test scores decline in math and reading by 15 and 10 percent of a standard deviation between 2018 and 2022 in math and reading, respectively.

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Why should you save and invest? ›

Saving and investing are both important to consider in your future planning. Through saving money, your money is kept safe, and easy to access should you need it. By investing early over time, your money grows in value, benefiting from the magic of compounding.

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