September 6, 2021

How to Rebuild Your Finances After COVID-19

Feeling the impact of the pandemic financially? Here are some tips to getting your finances back on track post pandemic.

11 min read

Katie Conroy

Guest Blog

@advicemine

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.

1. Housing

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. 

2. Debt

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!

3. Transportation

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


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How to Relieve Financial Stress

As you work to take the stress off of your wallet, don't forget to address the stress weighing on your mind, too. Financial problems are difficult and it's important to practice self-care as you work through them. This includes self-care practices like getting enough sleep, exercising, and eating well in addition to financial self-care. Financial self-care means:

1. Following a budget

Budgets aren't sexy, but budgeting relieves the stress of wondering whether you're on track financially or falling behind.

2. Reevaluate your living situation

If you currently rent and your monthly payment is too high, it’s time to find something less expensive.  Fortunately, Atlanta rental prices are below the national average. And rental prices start around $700 to 1,400 and go up from there. Ideally, you want an apartment in a neighborhood that meets your needs and feels safe. 

3. Paying yourself first

Don't wait to save until you have “extra” money. Build saving and investing into your budget and rebalance your portfolio if your risk tolerance has changed.

4. Avoiding credit trouble

Credit cards can be smart financial tools or a recipe for disaster. Avoiding bad credit behaviors keeps credit from becoming a burden.

5. Planning for the future

Setting goals and planning for the future promotes a positive financial mindset. A mixture of short- and long-term goals is best for maintaining money motivation.

The biggest thing you can do to practice financial self-care? Ask for help. When your financial problems feel unsolvable, connect with a financial advisor or a debt specialist. There is a way to rebuild and pave the way for a stronger financial future. 


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