The first thing you should do whenever you experience income loss is to call your creditors. In these times of crisis, many creditors are stepping forward and offering temporary relief in the form of reduced or skipped payments, reduced interest, and forbearance. The federal government has also mandated relief for federal student loans and mortgages. Chances are if you have a mortgage, a student loan, a car loan, or credit card debt, you may be eligible for some sort of relief. There are even some insurance and utility companies that are making alternative payment arrangements or allowing skipped payments.
The point is, none of this is automatic. If you want to be eligible for it, you must call. As a side note, it’s also a really good idea to track your calls in a spreadsheet or on a piece of paper. You’ll want to make note of anything you are offered, getting the name and extension of the person you spoke with. You’ll want it in writing if at all possible.
Now that you’ve called your creditors, you have a better idea of what needs to be paid and what can be temporarily put on hold. This will hopefully free up some of your income.
If you had any of your debts like your car loan or your cable bill on autopay you may want to take it off for the time being to allow for more flexibility in payment.
Chances are, you’re not driving much right now. In fact, we currently have one car that’s just sitting in our driveway. Give your insurance company a call and see if you can temporarily put your vehicle into “storage” at your house. I did this and saved about $55 per month, but it could be even more depending on your vehicle and where you live.
Just make sure that you don’t take your car out on any public road (starting it up every once in awhile in your driveway is perfectly fine) and that you reinstate the policy before you start driving again.
While you may not want to cut back on streaming services like Netflix right now if you go through your credit card and bank statements, you may find other “vampire costs.” My husband, for example, typically pays to stream Major League Baseball games online, but he won’t be doing that right now. And many people have gym memberships that they may not be using, music lessons they can’t attend, and other subscription services (like Apple Music, Bark Box, or pay to play online video games) that aren’t truly necessary.
Make sure to read the fine print – with some contracts, there may be a hefty cancellation fee. But there’s a possibility that the membership can be paused.
While it literally pains me to say it, there are times in life when one must prioritize emergency needs over saving for other goals. So, if there’s a chance that you may not be able to pay for your rent, your mortgage, or food or medicine, then it may be time to temporarily halt contributions to your TSP, IRA, or workplace 401k.
Just make sure to restart your contributions once the world settles down again. Saving is a good lifetime habit to have.