Adjusting Your Finances During a Crisis

It’s funny, I was talking to a friend last night about how even though it’s been a month since schools switched to having the kids at home, it feels like a lifetime ago.

Our family’s schedule now is so different and based on what’s going on with work and their schooling, it can shift week by week.

Like many families our finances have changed. Being self-employed, I’ve had some partners inform me that they are either cutting back or pausing certain projects.

Adjusting Your Finances During a Crisis

Looking at the numbers - over 1 million have filed for unemployment here in North Carolina - many families are seeing their finances change. Even if the two of you are still working, your budget before may not work this month.

If you’re dealing with reduced hours, unemployment, or you’re uncertain about what your work will be like in the next few months, it can be even more stressful.

How do you manage your money during times like these?

It can feel overwhelming, but if you take it one step at a time, you can begin to weather through financially tough times. Last week, I spoke with Coastal’s own Joe Mecca about how you can adjust your finances to pivot and push through.

Assess Your Cash Flow

The first step to creating a plan for this is to know where you are right now. That will allow you to get a clear idea of which direction you should take with your finances.

Your monthly cash flow - how much you’re bringing and how much is being paid out for bills and other expenses - is one of those key numbers you need to be on top of, especially now.

One way you can find that out is by simply logging into your Coastal accounts and reviewing your transactions for the past two to three months.

If you want to go the fintech route, there are some wonderful money apps out there that can pull your transaction information and organize it. You can then see how much you have been spending on essential and discretionary bills.

You may find that you are able to shift certain expenses like gas money for your commutes or lunches out towards necessary bills or savings.

Review Relief Options Available

With those numbers in front of you, you can assess if you can handle your bills for now or if you need some assistance.

Besides the CARES Act, there are protections in place here in North Carolina that could help you. During our conversation, Joe highlighted that there was a suspension on evictions and utilities cannot cut off service for non-payment.

It may not seem like immediate help, but you may be able to negotiate with your landlord and electric company to stretch out payments so your cash flow doesn’t suffer.

There are organizations like the Food Bank of Central & Eastern North Carolina, United Way of the Greater Triangle that are providing help to the local community.

Applying for financial relief can ease the burden and allow you to gain some stability and breathing room.

Prioritize Your Bills

Right now if you’re trying to figure out which bills to pay, keep your focus on two crucial goals -

• pay your essentials (roof over your head, food, utilities)
• start or build up your emergency fund

For other bills, see if they are offering assistance during this crisis or call them to negotiate your own payment plan.

If you have credit card bills and you can make the minimum payments, go ahead and take care of those.  Missing payments can affect your credit score.

Build Your Buffer

If you haven’t already, please make sure you are building up your financial cushion as much as you can.

Even though things seem very unpredictable now, the general guideline of stashing away 3-6 months of expenses is still a good goal to shoot for.

Using your stimulus check to beef it up can be wise and as well automatically transferring money into your savings from negotiating with your bill providers. For example, some car insurance companies are offering small refunds on premiums due to the stay at home orders being enforced.

An extra $50 may seem small, but moving that money into savings can have a positive effect on your financial cushion and give you some peace of mind.

Getting an Expert to Guide You

I hope these tips help you feel less stressed out and make it easier to adjust your money as needed.

No matter what you’re dealing with, Coastal is here to help you with your finances. There are many resources available. 

Whether you need to adjust your loans, get some relief assistance, or come up with a financial plan, Coastal has the people and resources to guide you step by step.

Please stay safe and healthy!