Tips for Faster Financial Recovery Post-Pandemic

author icon MPower News calendar icon May 19, 2020
covid economic recovery

Tips for Faster Financial Recovery Post-Pandemic

The COVID-19 pandemic has already impacted the global economy, and it is likely that businesses and individuals will feel the effects of this impact for a long time to come.

While taking care of your physical and mental health has been of paramount importance during the pandemic, it is now time to consider what the "new normal" in the post-pandemic era is going to be like.

It's time to make readjustments to any existing financial plan and prepare for the impact on your personal finances so you can bounce back in no time. Here are a few tips to ensure faster economic recovery post-pandemic.

Ask for help

The pandemic has created a situation wherein people feel like they have to do everything on their own, in isolation from those they love and those that have the expertise. However, this is a false notion that is aggravated by lockdown isolation. There is always help to be found – all you need to do is ask.

If you are still struggling financially, do not be scared to reach out to your landlord for some more time to pay rent or to your lenders for a longer grace period on loan payments. Reach out to people in the community with help pertaining to jobs.

At MPowering America, our financial experts understand that a slight ding on your credit score is all but an expected repercussion after this pandemic.

Get in touch with financial counsellors who can walk you through various debt relief and elimination options. While it is normal to feel afraid, there is no need to feel alone as COVID-19 has unleashed a financial crisis on everybody, even those who are wealthy or in control of their finances. Now is the time to act, so you can be well on your way to faster financial recovery post-pandemic.

Know where you stand

Before you choose to stand firm, it is essential to know exactly where you are standing. If you haven't taken any steps to take control of your finances during COVID-19, there is no need to fret. Start today by creating an income-expenses priority list, which will help you identify how much money is coming in and how much you are bleeding out.

Redo this list so you can focus on clearing debts and reducing unnecessary outgoing expenditure.

If ever there was a time to be frugal, it is now. The more money you manage to save, the better your chances of recovering fast in the post-pandemic era. We know this is not a feasible option for everyone, as everyone has been impacted differently. If you'd like to discuss what options are available to you, MPowering America can help.

Grow your emergency fund

In an ideal world, an emergency fund should contain approximately three to six months of expenditure. If you do not have that much put aside, it is a good idea to do so.

If you already do, add some more to your rainy-day fund, it will help you to steer clear of borrowing unnecessarily.

Keep the "end of grace" periods in mind

With so much happening around you, forgetting due dates is understandable. If faster financial recovery is your goal, it is vital for you not to miss future due dates on payments.

After taking note of all your income and expenses, be sure to write down details of any grace periods you have signed up for with your creditors.

Most companies and even the government have offered grace periods, so you can delay payments without it affecting your credit scores. As lockdowns begin to end, keep the end dates of all these grace periods in mind, so you do not accidentally forget to pay your student loan, mortgage, car payment, credit cards, etc.

Create a new budget

You can no longer rely on older financial plans. Post-pandemic, your financial plan has to take into account changes to your working hours and, therefore, the money you bring in, as well as other potential expenses. For example, if the number of hours you can work has reduced post-CoVID-19, your budget has to reflect this drop so you can visualize the effect it will have on your expenses.

Expect the unexpected

You may have had your life planned to the T in the past, but COVID-19 is a game-changer. Take some time to think of potential unexpected expenses that might come up and derail your financial recovery.

If you banked on your child's school to take care of her while you work, factor in that schools still might not be functioning as normal for some time to come.

This means you need to account for payments for childcare, which you may never have needed to do before. While many Americans are able to homeschool their kids, not everyone works in a career that will allow them to work from home and continue to do so.

When it comes to planning during a pandemic, we know to expect the unexpected, and the same applies for during the recovery period.

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