There is no doubt that anxiety levels are high. Many people have lost money due to the Covid-19 crisis, and with no endpoint in sight at the moment, it’s understandable to be worried. If you’re at risk of falling behind with payments, your debts are growing, or you’re looking for ways to increase your income, hopefully, you’ll find this guide helpful.
When the Covid-19 crisis hit, levels of personal debt in the US were at an all-time high. While payment holidays and temporary freezes on credit cards and loans have provided a safety blanket for many, there are concerns about the long-term impact of the pandemic.
Once measures are lifted, and people are expected to pay credit card bills and make repayments on loans again, will they be able to stay afloat? When you’re struggling financially, it’s very easy to lose control. Using your credit card or taking out a short-term loan can quickly spiral into surviving on credit and adding to your debts on a daily basis.
If you do find yourself in a situation where you can’t cover the essentials without reaching for a card or applying for another loan, it’s crucial to seek help as soon as possible.
Speak to your bank and any other organizations that you owe money to and make sure you’re aware of initiatives like the Debt to Success System that are designed to help people get out of the red. The sooner you reach out and ask for help, the better. There is support available, and no matter how much money you owe, there will be a way forward.
Taking Control of Spending
Many people get into debt because they genuinely cannot afford to pay their bills and their income doesn’t stretch far enough to put food on the table, but in some cases, overspending is the root cause. We live in a society where it’s possible to buy things at the touch of a button, and we’ve become used to placing orders and making payments without really thinking about it.
If you tend to spend more than you need to, and it’s affecting your finances, now is the time to take control of your spending. Check your balances on a regular basis, use Internet banking to keep an eye on activity, and set yourself limits. Use a budget to calculate how much you can afford to spend and try and save as much as possible.
If you have money left over after covering bills and essentials like food and gas, set up a transfer each month to your savings account and create an emergency or a rainy day fund. Simple strategies like reducing your weekly spend on groceries, shopping around for the best deals on insurance, and canceling subscriptions you don’t need can save you a vast amount of money.
Taking Advantage of Opportunities to Earn Money
Getting back into the black doesn’t depend solely on tightening your belt and starting to clear expensive debts. It’s also hugely beneficial to look for opportunities to earn money. The pandemic has caused problems across all sectors, but it has also created gaps in the market and new opportunities.
Think about how you could utilize your skills or interests to offer products or services to generate an income. You could provide virtual music lessons, run a home delivery service for baked goods or grocery store essentials or use your creativity to design bespoke modular desks, which offer space-saving solutions for home workers, for example.
Many people are experiencing financial pressures. If you’re looking to get back into the black, take these tips on board, and don’t hesitate to ask for help and advice.