COVID-19 has completely transformed our lives this year. For a lot of households, Covid-19 is synonymous with lockdown or self-isolation. As a result, many American family's financial stability is suffering, big time. Many professionals have been left without any income or with a reduced income for several months as the business world adjusted to the crisis.
Whether you already had debts before the pandemic, the uncertainty of staying at home and trying to make ends meet is highly stressful. We are facing an unknown situation, and therefore, we need to be creative about how to resolve financial issues. Applying for a new job, for instance, may not be an option right now. But that doesn’t mean you can’t recover your COVID losses.
FINANCIAL STABILITY & COVID-19: HOW TO BOUNCE BACK
Eliminate those credit card debts
When money gets short, it can be tempting to rely on your credit cards for purchases. However, the idea with a credit card is that you’ll be paying back the balance as quickly as possible to reduce interest costs. As such, credit card purchases are designed to cover little luxuries and additional items. When you begin to rely on your cards for essential purchases, you are in a position where you can pay off your balance unless your income increases. It’s a negative snowball effect.
It doesn’t take long to accumulate debts and high credit utilization, which leads to bad credit. Unfortunately, debt consolidation with bad credit is no viable option to eliminate your losses. But you can find appropriate debt relief plans that let you eliminate credit card debts and regain your financial stability.
Embrace a frugal lifestyle
Reducing your everyday costs can help regain control of your financial stability. Embracing a frugal lifestyle can be detrimental to managing a reduced budget. Too many households have failed to adapt their lifestyle to their COVID income, which leads to burning unnecessary large amounts of money that would otherwise be better used elsewhere.
Easy Frugal Tips:
- Couponing – You can either go extreme or even just use more coupons on grocery or shopping trips. Many stores have apps now that let you use digital coupons at the register so you don't have to hand the cashier paper coupons.
- Subscriptions – If you have subscriptions you're not using on a regular basis, get rid of them, or even put them on hold. Yes, that means you may have to cancel Netflix or Hulu, but it also means you're saving money.
- Buying Used – You really don't need to buy everything brand new. Consignment shops and thrift stores are great ways to buy clothes and some furniture without breaking the bank. The same goes for vehicles. If you can't afford it, or it would stretch you too thin monthly, opt for a used vehicle instead of a brand new one. Not only will you save money on the vehicle overall, but you can also save on vehicle insurance by not having full coverage.
- Barter & Trade – Yes, this is still a thing. I've done it a few times when it comes to fixing things around the home or our vehicles. Offer to do something or provide something in exchange for something to be done for you.
- DIY instead – There are so many things that hold up longer, sometimes even looks better, that we can DIY ourselves. So pull out that saw, the wood you've been “saving for a rainy day” and get to creating. Not only will you have a project that is homemade, but you'll be proud of it also. You can even use your Cricut machine to bring life back to old plain canisters, old window frames, and more.
As the coronavirus pandemic leaves many families in debt, it has become essential for households to develop a COVID-focused budget plan. Indeed, recouping your losses can help you recover from debt and build your wealth back. From tackling handicapping debts that are growing out of control to strategically reducing costs, you can gain financial stability.
Sell those unwanted/unused items
You can virtually boost your income by decluttering your home. Indeed, selling items that you don’t want or use – and that is in a suitable condition – can help you raise money to recover from the pandemic losses: eBay, for instance, is a fantastic place for appliances, clothing items, and accessories. It may not help with financial stability over a long period of time, but it can help get out of the rut right now.
Craigslist is another convenient platform, especially for large pieces of furniture. Alternatively, you can also launch a garage sale in your community, if you can sanitize all things and keep a safe and secure stand. Indeed, with the pandemic still lurking around, you don’t want to take any inconsiderate risk.
Launch your income-generating hustle
Now is the best time to start your independent career. Whether you are working from home or unemployed, you can create a side hustle business to make ends meet. A side hustle is, in essence, a new way of selling your existing skills. If you’re a marketing specialist, for example, you could sell your skills online via a website. If you are a DIY contractor, you can start workshops to train people via an online course.
Go back to School
When you have a lot more time on your hands, whether it is because of a pandemic, or because you lost a job, there is no better time to rope in your future financial stability than by going back to school. My husband is actually doing that within the next month. He is going back to become a Welding Technician. While he is still working, he wants to go into a field that is more in need and something he has been interested in for a while. In the long run, it will help us with our financial stability.
So in the end, a few changes can and will to the financial stability of your family not only right now, but in the long run with the right amount of work.