How to Cope with the Financial Difficulties Created by the COVID-19 Pandemic

Nearly half of all of the adults in the United States have claimed that they are experiencing adverse mental health complications as a result of the COVID-19 pandemic.

Woman Worried about COVID

Of these, the stress and worries of these individuals have been exacerbated over financial-based complications, such as not having enough savings, being placed out of work during shut-downs, losing their job completely, and being unable to handle their financial responsibilities – such as paying their rent or mortgage, making vehicle payments, paying credit cards, and paying on outstanding loans.

It is challenging enough having to deal with the immense fear and overall reality of disease and death; however, being coupled with the economic fallout of the coronavirus pandemic makes for its own disaster. In this guide, you will learn how to cope with the financial difficulties that you may be facing during this very challenging time.

As the COVID-19 pandemic continues to spread and impact lives – in numerous ways – economic disruption continues to abound. These disruptions have millions of people who are considered to be financially vulnerable in danger of suffering the most and experiencing the highest degree of financial hardship.

With employees being furloughed, laid-off, or completely losing their jobs, it is not at all surprising that the economic and emotional toll is weighing heavily among many and will likely continue to do so for many years to come. If you are feeling the stressors associated with the current pandemic, continue reading to learn how to effectively cope with those stressors.

Limited or No Emergency Fund

If your emergency fund is limited – or you have absolutely no emergency fund – you must place a focus on that which you are able to effectively control.

Examples include examining all of the expenses that you have, eliminating all non-essentials, and reprioritizing that which you spend. Your priorities should include rent or mortgage, food, and utilities. Your insurance should also be placed as a priority.

If you find yourself struggling to make payments, contact the creditor immediately.

Many special programs have been put into place during this challenging time to assist those experiencing financial complications. Additionally, those creditors may be able to waive late fees and other penalties.

Lying in Bed

Loss of Employment

In April – when shut-down orders were issued across the nation – over 20 million people experienced loss of employment.

If you are one of these people, immediately file for unemployment benefits. You may also be able to qualify for other types of government assistance, such as cash assistance, insurance coverage, and food benefits. Be sure to explore all possibilities.

You may find yourself surprised at the amount of help that you qualify for.

In fact, it may be just what you need to make it until you are able to secure employment.

credit cards

Credit Card Debts

According to figures, half of all adults within the United States possess some type of credit card debt. Out of these, up to 13% are not paying on these debts or do not know how to pay them.

If you have this type of debt, you should contact the credit card company immediately.

By simply explaining your financial hardship, you may be pleasantly surprised to find that many companies will allow you to skip a payment, lower your interest, or eliminate late penalties for a certain amount of time.

money in wallet

Difficulty Paying Your Mortgage

If you currently have a mortgage, you may qualify for mortgage forbearance. This is an agreement from the financial institution where you have your mortgage that either suspends your payments for a certain period of time or allows you to make reduced payments on your account.

This type of forbearance is highly beneficial in that it helps to provide financial relief to a limited budget or it may allow you additional time to completely catch up on your payments.

Keep in mind, though, this will not cancel out your debt. You will be held responsible for repaying any amount that is missed or reduced at some point in the future.

When contacting your financial institution, you should state that you are calling in regard to options for “forbearance” or “hardship”.

Debt Collection Calls

If you have received a call from a debt collector, you know it is not a pleasant experience. You should not ignore the calls, though. They will continue to attempt to make contact. If contact is not made, a lawsuit against you may be initiated. You should take the call and explain your situation to the collector.

In many instances, you will likely be surprised to find that they are often able to reduce the amount that you owe and/or work out payment arrangements that will fit into your budget. If you have an attorney that represents you, the debt collector should contact that individual and not you; however, they may not be aware of this and you are certainly able to direct them to your attorney.

To learn about your rights and other information about dealing with debt collectors, be certain to research “Fair Debt Collection Practices Act”.

We Can Help

Are you finding that you are suffering from financial hardship as a result of the current pandemic? Do you need financial assistance? We here at Somerville Bank may be able to assist you. Currently, our lobby is closed, but our drive-thru is open.

Those that we employ are more than happy to assist you through the drive-thru facility. If you find that you need to set up an appointment in order to consult with a loan officer or you would like to initiate the process of opening an account, you may contact us directly by calling 877-762-1463.

If you currently have an account with us, rest assured that the money is still insured by the FDIC and it is available by visiting our drive-thru, our ATM, through mobile banking, and through online banking. We have 8 locations in order to conveniently meet your needs. Please feel free to contact any of these locations on information on how we can help in alleviating financial strain during the COVID-19 pandemic: https://somervillebank.net/locations/