Money Matters Summer 2020

2 MONEY MATTERS | Summer 2020 The COVID-19 pandemic has brought job loss and changes to many work schedules, making it more important than ever to increase financial awareness and learn to incorporate healthy financial habits. This means developing and following a financial plan by first assessing your current financial situation and setting financial priorities. During this time of uncertainty, priorities may look different than they did a few months ago or even last year depending on how your income sources have changed. How do we make ends meet while securing our financial future? With this question in mind, people have become increasingly aware of the true value of their income and are researching tools to help them stretch their money as far as they can, for now and in the future. We have some tips to help members during these challenging times. Determine Your Income and Other Cash Flow Sources Due to the COVID-19 pandemic, millions of Americans have been affected by job loss, lay-offs and pay cuts. Those who are still employed are concerned about their financial future as well and are planning for uncertain times. By now, many who qualified have received their unemployment benefits and federal stimulus payments, but that may not be enough to cover the income gap in the long term, especially if other income sources have been exhausted. If you find that your expenses exceed the amount of income, you’ll need to figure out how to deal with the shortfall. • Add a side job. Some companies such as grocery stores and food delivery services are actually hiring because of increased demand. Be mindful that if you’re collecting unemployment benefits and working, the combined income could affect your continued eligibility. • Sell unneeded items. If you can’t find work to cover your expenses and do not have an emergency fund, selling unneeded items might help fill in the income gap. • Use your talents. Many people home in quarantine have earned extra money using their skills by sewing masks or offering their expertise in a subject area as a consultant or blogger. • Use your personal savings. You may have a savings account dedicated for emergencies or other goals that can help you cover your expenses. Keep in mind that you want to “pay yourself” back when you get back on your feet. During the first few months of the pandemic, the Credit Union waived fees for early withdrawals from Holiday Club and Share Certificates. The waivers expired June 30, so be mindful of withdrawals. • Apply for a loan or credit card. Adding more debt should be the last resort to cover your shortfall, but if you need help making ends meet, consider applying for a personal loan or credit card from your Credit Union. Just keep in mind that if you take this approach, you’ll want to pay off the card or loan as soon as you’re able, to save money on interest. Know What You Owe Once you know what you expect to make (keep in mind that this could change), total your “fixed expenses,” or monthly expenses that stay the same from month-to-month. You also want to total your “variable expenses,” or monthly bills that aren’t always the same each month. If you find yourself in a deficit, make adjustments. If the deficit is due to the COVID-19 fallout, reach out for help. Many companies and lenders, including the Credit Union, are willing to assist those who have financial hardship due to COVID-19 and are struggling to pay the following expenses. • Housing – For most people, the largest monthly bill is their rent or mortgage. If you’re worried about making that mortgage payment, it’s time to reach for the phone and see if you can work out alternative payment arrangements. If you’re a renter, you may also get some relief. Talk to your landlord as soon as possible to discuss your options. • Groceries – Rather than just looking for daily deals, it might make sense to go for lower-priced foods, if possible. Consider your choice in meats, buy generic rather than name brands, and canned vegetables over fresh. Better yet, start a garden and grow your own veggies. The savings can add up! There are also numerous food distribution centers that have popped up during the pandemic providing free groceries to help aid with your weekly food expenses. • Utilities – Utility companies are also offering breaks to those who have been furloughed or laid off because of COVID-19 by offering payment extensions and waiving late-payment fees, although you may eventually have to make up those payments. Check out your cellular and internet providers; most have pledged to not disconnect any customers for a certain period of time. Many have waived late fees and have opened free Wi-Fi hot spots to anyone who needs them. • Insurance – You should continue to pay for your home, auto and health insurance to protect your assets and keep expenses down if something happens. At least at the moment, many insurance carriers, lenders and landlords are allowing you a break or extension on monthly premiums. Budgeting Tips During