Maintain Financial Stability Even During a Pandemic
By Domi Garcia
We are only a little more than halfway through 2020, but what a year it has been! Nobody planned for the events we’ve experienced this year. Moreover, there are few people willing to predict what lies ahead. However, even in the uncertainty of the times, many of the tried and true principles of financial stability still hold true. Here are a few reminders that can help you stay on-track financially no matter what chaos is going on around you.
Stick to Your Budget
Many people have negative emotions about budgets. They feel constricted by them or fearful them or just unsure of how they work. However, a budget is simply a tool that enables people to understand what they are spending and control what they will spend in the future. In financially uncertain times, conscientiously following a reasonable budget will keep you from having to go into debt or being unable to meet your financial obligations.
Avoid Debt Whenever You Can
When money gets tight, it is easy to fall into debt. With credit cards so easy to obtain, purchasers can extend their credit beyond what is healthy. Furthermore, since they are so widely accepted, credit cards can be used to pay for almost anything. Reliance on credit cards can quickly catch consumers in a trap of owing not just the amount spent but also interest and in some cases penalties. You are wise to do whatever you can to avoid debt, especially unsecured debt.
Put Extra Money into Savings
While the pandemic has been financially costly for many people, there have been others whose finances were not substantially affected. In fact, staying home and spending less during the pandemic may have left a little more money in some people’s accounts after the bills got paid. If you find yourself in this fortunate situation, you have an opportunity to add to your reserve. Putting that extra money into savings is a great way to make sure you are prepared for the next unexpected crisis.
Watch Out for Scams
Unfortunately, scammers never take a break. Even during times of difficulty, there will always be people who are trying to take advantage of the kindness or naivete of others. Be on the look-out for things that don’t add up or offers that seem too good to be true. In this day and age, you can’t afford to let your guard down.
Ask for Help if You Need It
Finally, remember that if you need help, you can always ask. Many creditors are willing to work with those who owe them money, especially during extenuating circumstances. If you can’t pay back a loan or a credit card within the agreed-upon terms, you should be up-front with your creditor. Often they will be flexible on the terms if you can demonstrate a willingness to pay the money back as quickly as you can. The worst thing to do is to simply ignore your obligations and default on the debt. That isn’t good for anyone!
Hopefully these tips will help you to navigate the unusual days of 2020 – at least as far as your finances are concerned. Remember that Federated Bank is here to help in any way we can. We look forward to the time that our offices can open once again, but until then you can reach us by phone. Call your local branch if you have questions or need to set up an appointment for further discussion.
