The Coronavirus pandemic has hit the United States with a devastating one-two punch. While posing an extremely serious healthcare risk, since the emergence of the pandemic, 30 million Americans have lost their jobs or been furloughed, and that number was predicted to reach 35.5 million by the end of May.
While heavily populated states like New York and California have proportionately high numbers of office jobs that can pivot to remote work, the Southern states aren’t all so lucky. With large industry clusters like energy, automotive transport and other large facility-oriented sectors, the southern region has been hit especially hard by the pandemic, putting heavy pressure on residents.
You may have been paying your bills and living life comfortably, but when something like this happens, there isn’t always a lot of extra money left to play with. In this situation, if you or your spouse lost your job, had your hours cut or were financially affected in some other way, it may feel like there’s nothing you can do to stay afloat. But there is!
Proper budgeting and new financial habits can go a long way for you and your family at this time. To that end, we want to share 3 ways to stretch your budget during this crisis and protect your financial health.
1. Create a Crisis Budget
Families in San Antonio, Texas have definitely been affected by the pandemic, forcing many to go back to the drawing board and assess their financial picture. It’s very important that you reexamine your budget at this time and tweak it to fit the “new normal” of the current economy. Here’s how:
Eliminate Non-Essential Spending
Similar to how most states mandated the closure of “non-essential” businesses, you can use this time as an opportunity to reduce or outright eliminate non-essential spending and save money.
While living expenses like food, housing and utilities are typically essential, certain expenses, like ordering takeout, unnecessary shopping and what may feel like “little luxuries,” may need to be cut. Some companies are offering special deals for customers, which we discuss later in this article.
If you prefer a more moderate approach, consider only downgrading or reducing certain services, like temporarily replacing Amazon Prime with standard Amazon shipping, reducing your cable plan or consolidating two or three streaming services into just one. In response to COVID-19, a number of streaming services have begun offering content bundles to help their customers save money.
With a new budget, you’ll know exactly where you stand financially and have more clarity as you cover your monthly expenses.
Boost Your Savings with Generic Brands
Now that you have re-established your monthly budget, you can also find ways to save while you shop for essentials. As you shop, consider picking generic brands for food, cleaning supplies and other important household items instead of popular brand names, which are usually more expensive.
In fact, switching to generic brands can save you 20 to 30 percent on your typical spending, which can go a long way on a middle class income in San Antonio, Texas.
2. Stack Your Financial Resources
Your new crisis budget shows your cash flow and can clearly point out any places where your income or savings may come up short. You can utilize your other resources to fill any financial gaps.
Double-Check Your Emergency Savings
If you have an emergency fund, now may be a good time to put it to use. Your savings up to this point may be just what you need to bridge the gap across a job loss. Of course, your savings aren’t unlimited, but they can be a good way to cover certain expenses without having to use a credit card or personal loan, or selling investments set aside for your retirement. If you don’t have any savings at this time, you may have other options.
Coronavirus Bill-Pay Relief
Fortunately, many service providers are offering a bit of leniency to customers amid this pandemic. In some cases, certain companies are giving customers the opportunity to temporarily suspend their billing cycle if they’re unable to pay.
Specifically, some mortgage providers, credit card companies, insurance companies and others are offering payment relief to their customers, which can provide you breathing room for at least one billing cycle. Contact your individual service providers to see what assistance you qualify for.
Unemployment and Government Stimulus
If you have been affected financially by the pandemic, you can look into government stimulus and other resources as a backstop for your finances. The $2 trillion CARES Act earmarked billions of assistance for most Americans at this time. As of May 10, new talks involving additional Coronavirus stimulus have also taken place, and there’s also assistance available at the state level.
As a crucial member of the workforce, this may be your first time utilizing your state’s unemployment benefits. But the current crisis makes unemployment aid almost a necessity for many Americans, and it can provide just the relief you need while the pandemic is contained and the economy slowly reopens.
Though everyone’s financial needs are different, your combination of emergency savings, bill-pay relief, unemployment benefits and stimulus help can strongly assist you at this time.
3. Consider Side Gigs and Short-Term Employment if You Can
Amid the severe job losses of the past few months, there are still companies that are hiring right now, despite the crisis. If it works for you, look into remote-only positions or a temporary job to generate a bit of extra income. It may also be a good time to delve into a side hustle you may have thought about, if your situation permits.
Though not necessarily your first choice, these positions can help you replenish your savings or otherwise give you an extra edge financially. Some companies can offer certain benefits upon employment, like a 401(k), medical benefits or special discounts – which can be great for your new budget!
You Can Do This
The American economy – especially in the southern states – is in the midst of a financial storm. The current state of the economy is certainly difficult. But, if you can create a manageable plan, utilize all of your resources available and alter your habits, you have a better chance of surviving the economic damage caused by the pandemic and have a much stronger grip on your financial life going forward, whether you’re living in San Antonio, Texas or not.
This material is provided by PAX Financial Group, LLC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The information herein has been derived from sources believed to be accurate. Please note: Investing involves risk, and past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All market indices discussed are unmanaged and are not illustrative of any particular investment. Indices do not incur management fees, costs and expenses, and cannot be invested into directly. All economic and performance data is historical and not indicative of future results.