Practical financial steps to take during COVID-19

April 16, 2020
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There’s no way around it: The spread of coronavirus (COVID-19) is affecting every aspect of our lives, and many people are concerned about their financial future. Maybe you have a running list of questions playing on repeat in your head. Maybe you’ve already fallen down a rabbit hole of Google searches. Well, it’s time to take a deep breath: Below, we’ve gathered some expert insight and practical advice to help ease your stress.

If you’re afraid you might lose your job or income…

First and foremost, Samantha Eckhardt, a CERTIFIED FINANCIAL PLANNER™ for Union Bank, advises taking time to re-evaluate your budget. “Start by determining how long you can go without steady employment if you’re fired or furloughed.” (More on that shortly.) “You may want to consider pausing recurring payments that aren’t essential, like gym memberships and streaming services.” Once you’ve zeroed in on the cost of your necessities, you can create a plan based on how far your money can take you.

Eckhardt continues, “This is also a great time to take a look at your emergency fund and pad it with any extra cash you cut from your budget. If you have credit cards, it’s best to use them only for small purchases. As long as you can make the minimum payment each month, credit cards can help you get by if your cash flow suffers — just be sure to use them for essentials only.”

If you’ve been furloughed or fired from your job…

Being laid off is a stressful experience, and we feel for you. If you can, start first by having a conversation with your employer to get the specifics. Ask questions and find out when your pay and benefits stop. If you get paid time off, ask if they can pay it out to you immediately. You should also apply for unemployment benefits as soon as possible. Because of the CARES Act recently passed by Congress, most people unemployed due to the coronavirus pandemic will be eligible for benefits, and the new legislation also states that eligible workers will receive an extra $600 per week in addition to their state benefits.

It’s important to keep in mind, however, that unemployment applications are at an all-time high, so you should prepare for longer wait times regardless of whether you’re filing online or over the phone. After completing your unemployment application, your next step should be contacting lenders, providers, and your landlord, if applicable. Ask about any temporary payment relief options they may be open to. For example, Union Bank & Trust has implemented Payment Skip, a program for credit card customers that lets you skip your minimum payment due for statement cycles in April and May of 2020.

If you’re someone who has a safe and salaried job…

You’re thankfully in a good position to weather the storm, but it’s still wise to get prepared. If you can reduce your budget, do that — after all, 54% of employed Americans say that their wages have or will decrease due to the coronavirus pandemic, according to survey results from Money Geek. While you do have a safe and salaried job, it’s still a good idea to know where your potential shortfalls and liabilities exist.

You may also consider halting all unnecessary spending and moving the money you save into your emergency fund. Then, take some time to draw up a plan for what you’ll do if your employment status changes unexpectedly. Feeling overwhelmed? We get it, and we’re here to help. Schedule a time to touch base with someone on our team who can help you think through different scenarios — you can call us at 800.297.2837 or chat with us online.

If you’re someone who’s living off investments…

The good news: Generally, most financial crises take a relatively short period of time to bounce back, according to UBT’s own Ryan Sailer. “Every significant market pullback in recent times has been followed by a meaningful recovery during the subsequent 12-month period,” he explains.

As such, our experts caution against making significant portfolio changes during times of high emotion and volatility, because doing so could lead to major, unrecoverable mistakes. Instead, be patient; long-term investors are generally the ones who reap the rewards.

The CARES Act also outlines updated guidelines for accessing your retirement account funds if you’ve experienced financial hardship or loss of income because of the coronavirus pandemic — you can learn more about the changes in our recent CARES Act retirement plan update. But remember: Just because you can access those funds more easily doesn’t mean you should, so be sure to proceed with an abundance of caution and make sure you understand the potential implications of doing so.

We’re here to help

Looking at the news during a global pandemic is stressful, but the best thing you can do to feel more in control of the situation is to assess your finances and make a plan. And as always, we’re here to help you figure out your next steps.

Visit our COVID-19 Relief page to learn more about the solutions we’ve made available, and don’t hesitate to reach out with any questions or concerns. We’re going to get through this — together.


UPDATE: Most branches have reopened, but we encourage customers to check individual location hours and lobby availability.

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Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.