More Financial Tips for Turbulent Times
Prepare financially if facing job loss.
There’s no denying these are stressful times. In addition to worrying about contracting COVID-19, many people are losing sleep worrying about the economic uncertainty we are going through. Millions have lost their jobs, and many aren’t sure if their job is safe. If you are worried you may lose yours, take a deep breath. Don't obsess about all the things that you cannot change or influence—focus instead on the things you can change.
If you have a job, prepare for what might happen.
When you're prepared, you'll feel a lot better and in control of some things in your life. Preparation is the backbone of money management. The potential for a layoff is a wakeup call for anyone who has not been paying attention to the basics.
Break it down.
If you haven't already, turn your energy to these tasks:
- If you have unsecured debt—credit card bills—pay it off so you can stop paying high interest fees.
- Stop using credit cards unless you must, or unless you already pay the balance in full every month. If you do pay the balance every month, look into getting a rewards card, for example Skyward's Rewards Mastercard, to earn cash back on your spending.
- Consider opening an high-interest rate checking account (such as our fee-free Aim Higher checking account) and earn interest on your balance.
- Pay all bills a little early so you don't end up paying penalties or late fees, which can reflect in your credit score and increase your interest rate.
- If you usually receive a tax refund, go to your payroll department and resubmit a withholding form so that you get more money in each paycheck. Put the extra cash into paying off bills and building your emergency fund.
- Speaking of your emergency fund, build it up so you have enough to cover at least three months' expenses. Ideally, try to save enough to cover six months of expenses to give yourself a solid safety net. This may sound hard to do at first but it can be accomplished. If you can't save three month's worth now, start by saving what you can and you'll be suprised how your emergency fund grows.
- Use direct deposit for your paycheck and then set up automatic transfers so money is automatically moved from your checking into your savings account. This makes saving so much easier.
- Automate anything you can by using online or mobile bill pay and reminders. This will help you make consistent progress on financial goals, and help you avoid late fees.
- Refinance your mortgage or car loans to take advantage of lower rates, if you qualify. Talk to one of Skyward's loan officers about options to reduce your debt load or retire debts faster.
The more of these habits you develop, the more you'll ease your anxiety about a potential job loss. Even if you keep your job, you'll never be sorry you traded your bad old habits for productive new ones.
And if you do lose your job? Skyward Credit Union is here for you and among your best resources if you become jobless. Contact us to see how we can help at 833-759-1941.