COVID-19 has taken a toll on Americans' finances. 49% of working adults who lost wages during the pandemic continue to earn less than prior to the coronavirus outbreak, while 51% report the pandemic has made it harder to reach financial goals according to a Pew Research survey. Some people will bounce back quickly, while others may take a few years to return to pre-pandemic financial stability. One in 10 working adults, however, don't think their finances will ever recover. That paints a bleak picture, but not all hope is lost. In fact, there's a lot you can do now to take charge of your financial health.
COVID-19 Financial Relief for Families
You've heard a lot about financial assistance for businesses during the coronavirus pandemic, but what kind of help is available to average Americans? Other than Economic Impact Payments, these are the top forms of relief for families:
Reworking the Budget After COVID-19
These programs are invaluable for struggling families. However, the relief they offer is limited. If you've lost wages or incurred debt during the pandemic, balancing your budget may require more drastic action. The internet is full of tips on saving money by shopping sales, eating in, and cutting subscription services. But when you're in a financial crisis, little savings hardly make a dent. While it's important to save money wherever you can, your first priority should be your largest budget items: your house, your car, and your debt.
It's normal for housing to be a family's largest monthly expense. However, housing ideally shouldn’t cost more than 30% of your gross income. Moving is one way to reduce housing costs, but it's not the only option. Many homeowners are choosing to refinance during the pandemic due to historically low interest rates. Refinancing can reduce your monthly payment and save money over the life of a loan.
There's another perk to mortgage refinancing: You can use it to consolidate high-interest debts. Other strategies to reduce debt payments include negotiating with creditors and transferring balances to 0% APR credit cards. Alternatively, you can look to an app like Qoins, which helps you reduce debt by rounding up your purchases and putting change toward your debt. So far, Qoins has helped customers pay off more than $16,000,000 in debt!
Most Americans don't have the luxury of ditching their car and relying on public transit. However, while gas prices may be out of your hands, there are transportation costs you can control. Drivers burdened by an outsized car payment should sell a car they can't afford and purchase a used car with good fuel economy and a reputation for reliability. Meanwhile, remote workers can update their annual mileage with auto insurers to save money on insurance rates