In this time of great upheaval and uncertainty, we want to offer you some financial advice to make sure you and your family have the tools to navigate this moment in our country’s history.
First and foremost, continue to pay your bills. While there are programs that let you pause or reduce payments, you will be required to pay the money you owe once the program ends. However, if you cannot pay your bills due to job loss or other unforeseen circumstances, don’t panic! You have options, and we’ve outlined the different scenarios below:
If you cannot pay your bills:
Contact your lenders, loan services, and other creditors right away. Explain your financial situation and how much you are able to pay. The Consumer Financial Protection Bureau, along with other financial regulation agencies, have advised lenders to be more flexible with customers at this time.
If you cannot pay your mortgage payments:
The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, allows homeowners with federally-backed loans who are affected by the pandemic to request a temporary postponement of mortgage payments for up to a period of 180 days. Private loans may also be eligible. To find out more, check out these options.
If you cannot pay your students loans:
The CARES Act suspended payments on federally-held student loans through September 30, 2020. If you have privately-held student loans, you can contact your provider to see what options are available to you. The following FAQ from the Consumer Financial Protection Bureau offers some great information to help student loan borrowers.
Staying on top of your finances during the COVID-19 pandemic is not just about paying bills, it’s also about planning.
Make an emergency budget!
Make a budget that can account for reduced hours, a pay cut, or a potential loss of employment. To do this, take note of where your money is going so you can pay your expenses and save, too. When it comes to making an emergency budget, Mint, a free web-based financial counseling service, suggests the 50/30/20 rule. Allocate 50 percent of your income to essentials, 30% to wants, and 20% to savings. Try this out with their 50/30/20 Budget Calculator.
We understand that this is a time of great anxiety and fear. We want all of our clients to know that we stand with them and we are here to respond to any questions you might have about the ongoing economic and public health emergency. Our financial counselors can assist you with making a budget, building credit, managing debt, and connecting you to affordable financial services and products. If you have more questions, contact us at 718–292–2983.