Pandemic has altered financial plans

Get your act together: Before making your post-pandemic plan, you should first get your financial house in order. If you haven’t yet returned to work or find yourself without a job, now is the best time to do this critical task.

Organize all your financial documents, including insurance policies, wills, trust documents, tax returns, banks, credit reports, pension statements and anything else related to your money. You will be referring to these documents often. To make things even more accessible, consider digitizing everything you can and backing that upon a portable thumb drive or external hard drive.

Create a spending plan: Hopefully, you have some savings. But, even if you don’t, you need to take a hard look at every expense you have. List all your bills and divide them into “Absolutely need” and “Can do without.”

Doing this is hard, but you will need to do it without flinching if you want your money to last longer. Write down your adjusted “worst-case scenario” income. Add all your bills together and decide which of them is deferrable until your income improves.

Identify all resources for which you qualify: If you’ve lost your business, been laid off, or had your hours reduced, things can feel pretty hopeless. But now is not the time to give up. You aren’t alone in this. It’s time to start looking for the help you need to make it through this economic downturn.

Unemployment benefits: An excellent place to start: Depending on your state, employment situation, and other factors, you may be eligible for unemployment. If there is any possibility at all that you qualify, begin the process now. As of this writing, over 42.6 million people (over one-quarter of the entire workforce!) have filed unemployment claims.

Many states have a backlog, so you need to start your claim as soon as you can. Fortunately, nearly all states have online and phone systems that can expedite your application. You do not want or need to wait until your local unemployment office is open.

Local government, religious and philanthropic organizations: Many local governments have safety nets in place for their most vulnerable citizens. If you are low income, disabled, over 55, have small children or grandchildren who live with you or are caring for an elderly relative, there may be programs in your city, town, or county to help offset your expenses.

Some local governments operate food banks, free clinics, subsidized childcare, or transportation systems. Be sure to see what’s available for you close to home because it’s often easier to access than larger, Federally-sponsored programs.

Talk to your creditors: It may be tempting to skip your rent, mortgage, or credit card companies. But don’t do it until you’ve spoken with them first. Even if your city or state has temporarily halted evictions, you still want to pay the landlord if possible. Some landlords have rent concessions in place to help those having trouble paying on time. Similarly, many banks and mortgage companies are trying to reduce defaults by offering special plans to reduce mortgage payments.

Credit card companies have also rolled out more flexible payment schedules, and a few have eliminated late fees, reduced interest rates, or extended grace periods. Talk to all your creditors about options to help you preserve your good standing and credit score.

Be sure to keep records of all offers and agreements you receive and notes about any phone calls you have regarding your debts. It’s also a good idea to regularly monitor your credit to see if it is accurately reported.

Discover other sources of income: The pandemic has forced some people to become creative when it comes to locating alternative sources of income. Think of how you could earn extra money providing services people need right now. Sell your unwanted designer clothing and shoes online, get rid of that second car you no longer need or auction off memorabilia and jewelry. Good at arts and crafts? There are tons of places online to sell your handcrafted items.

If you own your own home, a home equity line of credit could provide some relief. Unlike credit cards, HELOCs typically offer low rates versus credit cards or other loan products. You might also want to look into refinancing your home. For either of these options, it is a great idea to do your research and seek the assistance of a professional who understands all the nuances of these products.

Keep your future financial health in mind: During a crisis, it’s easy to lose sight of the plans you had for your financial future and make bad decisions that will come back to haunt you. However, with a little planning and the help of your financial professional, you will remain calm and clearheaded and avoid making mistakes with your money.

(Lawrence Castillo is a member of Syndicated Columnists, a national organization committed to a fully transparent approach to money management. L and C Retirement Income Planners, 4801 Lang St. NE Suite 100 Albuquerque NM 87109 505 798-2592 lawrencecastillo.retirevillage.com)