COVID-19 has upended a lot about our world. One of the most dramatic challenges that has occurred over the last couple of months is the number of people who have lost their jobs due to the economic impacts of the coronavirus.
Many people don’t know where to begin thinking about what they need to do in order to get their financial selves together and get back into the job market.
Here are 10 steps you can take if you’ve lost your job due to COVID-19:
- Apply for Unemployment Benefits – As of mid-May, over 36 million Americans have filed for unemployment benefits. Thankfully, due to rules that have been eased, you don’t have to actually have completely lost your job in order to receive unemployment benefits. If your hours have been significantly reduced, you can still apply. By applying for unemployment benefits as soon as you’ve been let go or your hours have been reduced helps to ensure that you will receive benefits in a more timely manner.
- Cut Bank on Your Finances – If you lose your job, it’s time to take a look at what you spend money on. How often do you order take-out? Now’s the time to cut that back to once or twice a week. Are you paying for a subscription you do not need? Delete it! Does your mobile phone plan allow for more minutes than you ever use? Look into a less expensive plan that has fewer minutes. By making changes, both small and large, to your spending, you can significantly reduce your monthly expenses.
- If You Have a Mortgage, Call Your Lender – If you own your home and you’re worried about being able to make your next mortgage payment, contact your lender. Most banks are now offering forbearance relief to their customers who have encountered significant financial hardship due to COVID-19. According to Investopedia, forbearance “is a temporary postponement of mortgage payments. It is a form of repayment relief granted by the lender or creditor in lieu of forcing a property into foreclosure.” However, customers should know and understand that at the end of the forbearance period their entire mortgage payment is due. For example, if your mortgage is $1,500 and you have a 3-month forbearance, at the end of the three months, you’ll need to make a $4,500 payment.
- Student Loan Relief – If, like millions of Americans, you have student loans, you can get some relief in your payments. The federal Coronavirus Aid, Relief, and Economic Security (CARES) Act suspends federal student loans through September 2020. If you have private student loans as well, contact your lender because many private lenders are offering loan relief as well.
- Contact Your Credit Card Companies – Many credit card companies are offering assistance to credit card holders. From waiving late fees to payment deferrals, companies are offering a variety of options to help customers experiencing financial hardship as a result of the current global pandemic.
- Contact Your Utility Providers – When you are out of work and looking for a job you will very likely still need to have internet access in order to job hunt – especially as many businesses are still working mostly remotely. The Federal Communications Commission (FCC) has asked broadband and telephone service providers to not end a customer’s connectivity due to these exceptional circumstances. To date, more than 750 companies have agreed to take the pledge to keep people connected.
- Be Wary of Payday Lenders – In times of financial hardship, some people look to payday lenders to access immediate cash. However, these lenders can cost big in the long run. Payday lenders often require up to 400% in interest on the loan, compared to 15%-30% APR on credit cards or 10%-25% on personal loans. So, while the thought of being able to get an instant flush of cash is tempting, using a payday loan is usually not worth the ultimate cost.
- Reach out to Your Community – Now is not the time to give in to your pride. There are many community programs that are popping up to help people who have recently been hit hard financially by COVID-19. From community food banks to rent or mortgage payment assistance programs, nonprofits and community groups alike are stepping in to help people in need.
- Think Outside the Box – If you are currently out of work and your industry has been hard hit, begin to think about what skills you may have that can help you find a job – even if it’s not within your current career path. Additionally, now might be a good time to learn a new skill or dust off job skills that you have not used in some time. Are you handy with fixing computers? Think about offering your services in your neighborhood as a side hustle until you can find more permanent work. Thinking outside the box can help keep your head above water until your career industry recovers.
- Actively Look for New Job Opportunities – While some industries have been extremely hard hit during the global pandemic, others are thriving. Businesses such as grocery stores, Amazon, and CVS have all announced job openings in the last month. Searches via the internet can help direct the recently unemployed to job opportunities via search engines and LinkedIn.
Even though this change is temporary, It can be easy to feel helpless when you have lost your job. However, by following these steps you can help take control of your finances so that you can focus your time and efforts on securing new employment.
