The Coronavirus pandemic has changed many things in our daily lives. The area that has been most affected is people’s financial security. People are experiencing loss of income and even work as the pandemic progresses. But there some things that you can do if you want better financial security in these times.
Consider Refinancing Your Mortgage
If you took out one of those jumbo mortgages to buy the house of your dreams, then there is some good news for you. You may currently struggle with your current interest rates and payments, but there is a simple solution to that: refinance. Currently, the market is experiencing very low-interest rates. If you take out a refinancing loan, you can easily get a deal that will ensure that your monthly payments are much lower than you currently are paying.
However, it won’t be simple. You need to have some proof of income and a good credit score. But if you plan to stay in your current house for a long time, then you should seriously consider refinancing your mortgage.
Keep On Building Your Emergency Fund
While we are in an emergency right now, this does not mean that you can draw on your emergency fund. Many people are lucky enough to have their jobs still or have alternate sources of income. You should only dip into your emergency funds if you have to pay medical bills or an emergency expense. What you should be doing is to continue building up your emergency fund.
Your goal is to have six months of “noodle budget” which is your lowest monthly spending. If you have less than that, then keep on adding to your savings. It’s hard to predict what will happen in the coming months, even if you are currently comfortable. Having those emergency funds can help you last half a year to recover from any financial emergency.
Take a Look At Your Health Insurance
One of the few things people noticed was that insurance companies immediately took action when the pandemic went into full swing. Many of them moved to cover COVID-19 as part of their insurance package. You may already have some financial protection from the pandemic, and you don’t know it.
Check with your insurance company to see what sort of coverage you may now have. This might help you pay hospital bills and other expenses. If you don’t have insurance, this is the best time to get some. The premiums are a bit higher, but the added protection can be worth it.
Do Not Pull Out Of Your Investments
If you have stocks and shares, you are probably despairing at their current state right now. Some industries that were strong before the pandemic experienced powerful hits. For example, cruise lines and restaurants have had share prices drop like a rock. The usual wisdom is to cut your losses and salvage as much as you can from your initial investment. But these are not normal times. Many of these losses are mainly because of the pandemic.
The smart approach to your investments would be to hold on to them and to wait for the markets to rebound. If you have extra cash or have money in some fixed-income investments, you should put them to use by buying more of the current low-value stocks. This allows you to add to your investments, so when the recovery comes, you can reap the rewards.
Continue Paying Your Debts
Many lenders are offering a moratorium on debt payments. That can be an opportunity for those who lost their jobs. But if you are still getting a salary, you should continue your payments. This is because the moratorium that some lenders announced only covers the late fees. The interest is still piling up. Even a few months of not paying will add a sizable chunk to your payments. This is even worse with credit cards considering their high charges. Keep on paying the debts to ensure that you don’t increase your debt after the crisis.
Use Your Government Benefits
There are many government benefits available to those who lost their jobs or have hit a certain level of income. Use the to your full advantage. Unemployment benefits are your biggest help when you are down on your luck. Your tax dollars paid for these benefits; so you should not be ashamed of using them until you get on your feet.
These financial moves can help secure your finances even during these tough times. Take the right steps, and you can emerge from this crisis with money in the bank and fewer worries.