9 ways to protect your finances from the new COVID lockdowns

9 ways to protect your finances from the new COVID lockdowns The latest wave of coronavirus in the U.S. is proving to be the worst one yet, with 1 million new cases reported nationwide in just the last week and about 1,000 Americans dying every day. Officials are fighting back […]

9 ways to protect your finances from the new COVID lockdowns
9 ways to protect your finances from the new COVID lockdowns

The latest wave of coronavirus in the U.S. is proving to be the worst one yet, with 1 million new cases reported nationwide in just the last week and about 1,000 Americans dying every day. Officials are fighting back with new restrictions to stop the spread.

The governors of Oregon and New Mexico have ordered two-week lockdowns to keep people home, and so has Chicago Mayor Lori Lightfoot. Other states and cities are imposing curfews or requiring restaurants and bars to offer carryout only.

The clampdowns could spell more trouble for Americans’ livelihoods, especially if new furloughs and layoffs squeeze workers still hurting from the earlier forced closures.

Here are nine things you can do to protect your household finances amid the new lockdown round.

1. Keep saving

money, home, finance and relationships concept - close up of couple with piggy bank sitting on sofa
Syda Productions / Shutterstock

During the earlier waves of the pandemic, financial experts urged consumers to build up their own emergency funds and give themselves cushions of savings, just in case.

Apparently, people listened. In April, the U.S. personal savings rate — the percentage of disposable income that people are setting aside for the future — soared to 33%.

That was the highest since the Bureau of Economic Analysis began tracking the savings rate in 1959.

If you’ve managed to keep the recession from draining your emergency fund, try to continue making regular contributions. As long as the money is stashed in a high-yield account, your savings will continue to grow at a better-than-usual rate, leaving you more to fall back on.

2. Sharpen your credit score

If a new lockdown puts your job at risk, you may need to take out a personal loan to help cover your expenses.

And if your credit score isn’t great, it’ll be a lot harder to get a loan at a decent interest rate. The best way to make sure your credit score is in good shape is to check up on it every month.

These days, it’s easy to see your credit score for free online, and companies that help you access your score often provide free credit monitoring services, too.

You’ll be notified any time your score changes, and get helpful tips on how to restore your score if it takes a hit.

3. Clear out some debt

Credit cards
Marie C Fields / Shutterstock

Credit card debt can be tough to manage during the best of times — interest rates can top 20% — but it’ll be even more difficult if a new lockdown interrupts your source of income.

If you start racking up interest on multiple cards and fail to make the minimum payments, your credit score will plummet and your debt will spiral out of control.

It’s a good idea to make larger-than-normal payments now, if you still have the means to do that.

With a solid credit score, you may be able to reduce your monthly debt payments by bundling your credit card balances together into a single debt consolidation loan at a lower interest rate.

4. Expand your job search

If you’re concerned about losing your job to a new lockdown — or if you’re unemployed and looking for work — make a habit of checking for new job postings regularly, maybe even twice a day.

Today’s online job boards will show you jobs you’ve never heard about, and that happen to fit your profile. They can even provide valuable hiring info, including the qualifications recruiters look for in a top candidate.

Before you start your search, make sure you have a professional, up-to-date resume you can send to potential employers and upload to LinkedIn and other networking sites.

5. Take on a side gig

Graphic designer
Rawpixel.com / Shutterstock

Whether or not you’re hunting for work, bringing in extra income from a side gig is a great way to help with your daily expenses.

You can use an online freelance marketplace to find buyers for all kinds of talents, whether you dabble in graphic design, write a blog, are great at voice acting, or know how to give life coaching.

Best of all, most of these side gigs can be done from the comfort of your home.

Spending a few hours a week on your side hustle will help expand your network and build up your resume, to improve your chances of landing a full-time job in the future.

6. Make sure you’ve got health coverage

When you lose your job during a lockdown, you typically lose any work-based health insurance, too. The consumer advocacy group Families USA estimates that the pandemic has thrown 5.4 million people off their coverage.

You may feel you can’t afford to buy a new policy right now, but if you or someone in your family runs up medical expenses while you’re not covered, it could cost you far more that what you’d pay in insurance premiums.

To get the most coverage for the best price, you’ll need to shop around and get quotes from multiple insurance companies. You can compare rates for free online and find the lowest rate in just a few minutes.

7. Take advantage of online discounts

Airpods
Wikibuy

New lockdowns may put brick-and-mortar retail stores out of operation again, and consumers will need to do most of their shopping online.

Shopping via the web has its perks: You don’t need to put on a mask or even get off the couch, and you have the ability to check prices across an enormous range of stores.

By installing a free browser extension, you can instantly compare prices on everything you order, even factoring in shipping, sales tax and availability. You’ll also track down coupons and promo codes you can automatically apply at checkout, to save even more money.

8. Keep your retirement plan on track

Fidelity Investments says average 401(k) balances dropped by almost 20% earlier this year, when the initial COVID outbreak in the U.S. sent the financial markets reeling. Fresh lockdowns could set Americans’ retirement savings back even further.

If your plan for your golden years has been derailed by the coronavirus, you may want to sit down with a financial adviser to get your portfolio back on track.

Working with a certified financial planner is more affordable than you might think, and nowadays it can be done entirely online. So even during a lockdown, good advice is nearby.

9. Take stock of your spending

Receipts
wutzkohphoto / Shutterstock

If you don’t track every dollar that leaves your bank account each month, you’ll be surprised by how much you can save with a few tweaks.

Create a list or a spreadsheet of your monthly expenses and identify any nonessential items that can be cut out of your budget during a lockdown. For example, do you really need to subscribe to multiple streaming services?

And search for savings on your recurring or automatic expenses, like your homeowners insurance. Review how much you’re currently spending and then compare rates from at least three other insurers to see if you can get a better deal.

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