In the midst of the Covid-19 crisis, so many of us have had our income suspended abruptly. I think that the most difficult part of this is not knowing how long we will be unable to work at our jobs or when our businesses will be able to open again. It might help your anxiety to take some control and make a plan for what you can do right now. Even if that plan feels crazy, attempting a plan I think will help.
- First things first! File for unemployment as soon as your work has closed or even if you have reduced hours. This now applies to small business owners and the self-employed according to the stimulus package passed today. (Will post a run down on the legislation very soon!)
We are going to have to come to terms with what we are going to pay and what we are not going to be able to pay based on your savings and unemployment money coming in. Most of us live paycheck to paycheck so there will be tough decisions to be made.
- Most regional utility and telecommunication companies are promising not to shut off services for non-payment and the dates are continually being pushed back. Contact your providers to see what their policy is.
- If you can’t pay your rent, there is some solace in the fact that most counties will not be proceeding with evictions. If a landlord tries to remove you without the proper proceedings or locks you out, it is considered a crime and you can call the police. However some leases have a no redemption clause and can still proceed with eviction proceedings if you later make good on your rent. Talk to your landlord and try to make a deal to pay late or set up a payment plan (and try to get it in writing).
- Medical bills typically do not go on your credit report unless they go to collections. Often you can prevent that from happening by paying a small amount each month.
- Go through your bank and credit card statements and review your automatic payments. Cancel what you can and decide what you can possibly defer or be late on.
- Cancel all non-essential services. Gym memberships, share streaming services with your friends and family.
- Call your bank or loan companies to see if they are offering to allow you to skip mortgages, lines or credit, car payments, student loans.
- Pay credit card minimums because they won’t be as forgiving as other financial entities and report to your credit score sooner (within 30 days compared to 60 days for other institutions). You can always contact them to see if they will waive the minimum for a month or so.
- Pay your health insurance and car insurance if possible. And again, contact them to see if you can push a payment back.
- Get a credit card if you can (especially if you have a deal of 0% sitting in your mail pile) and put your spending on it. Figure out what you can do to buy time – you might have a clearer picture of what your expenses and income are going to look like in a month, and saving cash today keeps your options open.
- Save as much in your checking account by not paying what is absolutely necessary.
Once these decisions have been made, that will give us the opportunity to try and put those worries on a shelf so we are not constantly focusing on a loop of overdue bills. There are a lot of us in the same boat right now. Taking the pause from your financial worries will allow you to honor your feelings. Take the pause to feel your feelings, but worry, in and of itself, is not a virtue. It doesn’t actually help the situation. There is support available now and there will be even more support in the coming weeks. This is a marathon not a sprint.
So you might ask, what are we gonna do when the mandates are lifted and we can go back to our paycheck to paycheck jobs and have 3 months of back rent to pay?
- I don’t fully know the answer to this question yet.
- This will depend on how long we must shelter in place. This will depend on whether some jobs will open sooner, but gig or restaurant jobs are still suspended.
- Take advantage of any rent assistance programs or loans being offered in your area as soon as possible. See a Pittsburgh option here.
- Negotiate with landlords for waived or discounted rent.
- BUT we don’t have to plan for 4 months from now. Right now we have to triage the situation and come to terms and make a short term plan to get us through the next month.
- Then we relax a little and take advantage of the pause to feel our feelings. Dream of the new world we could build and how you want to be a part of it.
- Then we will grieve our losses.
- Then and only then can we truly make the NEW plan.
This is also a really good time to have empathy for the folks who feel this kind of pressure most of their lives. And if you’re that person reading this I hope this can be a time of solidarity for all of us.