The planets seem to have all aligned for the month of April, and not to our benefit. Presently we’re facing a future of economic uncertainty due to the COVID-19 virus and, ironically, it’s Financial Preparedness Month and Stress Awareness Month.
Financial worries can cause enough stress on their own, but to have to deal with the impact of a deadly virus makes us all the more anxious. So what can we do during this month to become better financially prepared?
First, have an emergency cushion. By May or June most Star Valley residents will receive a one-time payment (called a Recovery Rebate) to help provide emergency financial support thanks to the recently passed CARES Act. Families within the income limits will receive $1,200 per adult, and an additional $500 per child under age 17. For some families, this could mean an extra $3,400 or more. If possible, this money should be saved rather than spent. Most Americans can’t afford to cover a $1,000 emergency expense with cash, and turn to credit cards instead. Do yourself a favor and set your rebate aside for a rainy day, or at least earmark it for paying your most essential expenses, like housing, utilities, or food. This will give you peace of mind in knowing that, in a pinch, you can still cover your needs for a while.
Second, plan your monthly cash flow. To most of us, ‘budgeting’ sounds like a four-letter word. If you find it hard to develop a budget and stick to it, review a couple of past bank statements to see your typical monthly expenses. Figure out your essential and non-essential expenses so you can be prepared to cut if there’s a downturn. It may feel like a hard pill to swallow, but knowing where you are financially will make it easier to get to where you need to be.
The economic uncertainty due to the COVID-19 outbreak has caught us all off guard. By getting a better handle of your finances, you can help ease some of the stress that may come along with it.
Hale Financial Solutions
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halefinancialsolutions.com