Practical Finance

Practical Finance 

By Cathy Perkins

We’re all in this pandemic together. That means we all need to look out for each other and give back where we can. When I looked for ways to help others, the obvious kinda stared me in the face. I work in the financial sector and could talk about financial moves to make right now if you’re out of work and worried.

Hopefully, you received your economic stimulus payment today. If not, you can check the IRS website (go here) to see where you are in the process. There’s also a link for the alternative registration if you didn’t file a tax return last year.

In the meanwhile, there are other steps you can take if you are caught in the shutdown without a paycheck.

Important note:

I've posted a longer version of this post on my website (https://cperkinswrites.com) with lots of links for exactly where to go for these and other subtopics. 

Hopefully this quick overview will help. 

Image courtesy of Librarypoint.org which details Virginia state help

Your job and benefits

Check with your employer and get a timeline. If this a furlough? A complete separation from service? Will you be recalled as soon as your company reopens or is this a permanent layoff? Are there any employer provided benefits? Ask about the status of your benefits, especially your health insurance.

Unemployment

If you haven’t already filed for unemployment benefits, do this first. Yes, the state websites were overwhelmed and crashing and the lines were long, but go do this. Try to apply online with your state’s labor department rather than over the phone or in person.

Mortgage payment

If your mortgage is federally backed, the CARES Act gives you a right to forbearance for up to 12 months. Federally backed mortgages include loans owned by Fannie Mae, Freddie Mac and various federal agencies. Forbearance means you don’t have to make payments, although interest will typically still accrue. There’s also a 60-day moratorium on foreclosures and foreclosure-related evictions for these mortgages.

If you’re not sure whether your mortgage is federally backed, call the company that takes your mortgage payments, aka your loan servicer, and ask. Even if your loan is not federally backed, you may be eligible for some kind of relief. Explain your circumstances and ask what help is available.

If you don’t ask, the answer if “no.” 

Rent and utilities

A number of states have implemented policies to prevent eviction during the crisis, or at least through May—but understand even if your rent or utilities are suspended, you still have to pay them later. 

Try to pay at least part if you can, but reach out to your landlord and explain your situation. Odds are, the person who owns your building is in the same bind. He or she owes a lender for the building’s mortgage and common area utilities and insurance and is scrambling to figure out where the money to pay those bills is coming from.

Spending

Look at everything. Say the B word (budget) out loud. Can you live without a subscription, be it television or another entertainment charge? Cancel the gym, the monthly basket of whatever. There are a ton of services available for free. Question everything. Use this time to explore some of those options. 

Final Word

If you still have a job, focus on an emergency fund. If you already have 3-6 months expenses in a cash-equivalent fund, good planning! If not, build that fund first and then consider the current stock market swan-dive an opportunity to build a regular investment fund.

If you’ve lost your job, you may be tempted to put off asking for help, hoping that you’ll land another job before your household is on financial fumes. Don’t go there. Assume you could be out of work for many months. Not only is unemployment skyrocketing, but a vaccine could be a year or more away, indicating the economic disruptions likely will continue.

Good luck, and don't lose hope.

An award-winning author of financial mysteries, Cathy Perkins writes twisting dark suspense and light amateur sleuth stories.  When not writing, she battles with the beavers over the pond height or heads out on another travel adventure. She lives in Washington with her husband, children, several dogs and the resident deer herd.  Visit her at http://cperkinswrites.com or on Facebook 

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She's hard at work on sequel to The Body in the Beaver Pond, which was recently presented with the Claymore Award.