As theThe crisis continues to take over the economy, with most households working with limited resources. Maybe you've lost your job like millions of other Americans. You may have to work fewer hours or look after children or older relatives full-time.
With so many different circumstances, it can be difficult to take control of your finances – especially with limited resources. But if you have an income – a job,or unemployment insurance – you can update your budget to get through these tough times. So you can make your budget recession-proof.
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1. See how much you need
Your needs may change from week to week. However, check your budget frequently to find the minimum amount you need to cover your costs, e.g. B. Basic needs and all the bills you can afford. If necessary, create a budget by specifying each source of income – even if it is– and costs. Your expenses are things like your home and automatic payments, but also things like food, student loans and gasoline.
Make sure that your expenses are not higher than your income, and if so, see where you can make cuts. For example, your student loan payments are paused until September 30th without penalty. Having student loans frees up a bit more money in your budget to create more timely bills.
Check how much money you've made and make sure all of your bases are covered. If you have a little more, keep it for the next week or month. Since the future is uncertain – for your health and your job – it is good to have a little more money with you. If you can save this extra money for more than a month, you should set up a high-yield savings account like Marcus or Ally.
2. Reduce your budget to the point
If you don't need it, drop it. These can be things like subscription boxes, gyms, or anything you've set up to pay regularly that you're not currently using. While streaming services areConsider stopping or stopping those you don't use.
It's also a good time to customize any line items you need but are flexible, such as B. Food. When you've covered your regular bills, you'll see how much money you can spend on groceries every week or month. Your shopping list may also need to be brought to the point.
Make sure you shop for your pantry before heading out to get more food. Because grocery stores already have a few things in stock, you may not have access to all of the ingredients needed in some recipes. Use what you have before you buy more food. Only store if you have the extra money and resources available. For example, an additional freezer or just a large freezer to stock up on extra meat.
3. Stop making contributions to old-age provision
Regardless of whether you have a work-sponsored account, an IRA, or a mix of many different types of funds, it's time to temporarily suspend your contributions.
Your recession budget is not your normal budget. You are planning for the now, not for the future. To cover your regular expenses like house payments, utilities and groceries, you need cash.can wait until you have additional money to contribute.
4. Store your money
Keep your money in an easily accessible account, e.g.. It should be an account that you can withdraw cash from at any time. It should also be a place where you keep the most money when you need it.
This does not mean that you have to use up your investments and transfer everything to your checking account (unless you need this money to cover the essentials). However, you should monitor weekly or monthly how much money you need – or how often your expenses can change.
5. Postpone loan payments
Whether you have a home, car, student, or personal loan, now is the time.
Many car lenders allow borrowers to defer payments or avoid additional fees by foregoing fees (such as late fees). Also ask your car insurer whether they offer hardship assistance. For example, Geico pauses cancellations if you miss a payment or your policy expires.
Federal student loans are given a long pause as payments are suspended until September 30th and no interest accrues during that time. However, if you have private student loans, you need to contact your lender to find out what you qualify for. Personal loans, including through private lenders, should also be contacted on a case-by-case basis.
Also, check with your utility company about the resources they can offer. For example,for $ 10 a month for low-income households that qualify. It also stops the termination of cellular, phone, or broadband services if you can't pay your bill. However, you need to contact your provider to explain your situation.
Use your resources now to cover the costs
Remember that an emergency fund must be used for emergencies. Don't be afraid to get money out of mutual funds, pension funds or savings to pay for things you need today.
It's a good time for that too. If you have enough money to pay your bills, such as rent and car payments, use your credit card whenever you can. Even if you keep an account balance from month to month, make sure you have enough cash to insure yourself for as long as you need it.