As COVID-19 spreads in the U.S., people all over the country are beginning to feel its financial ripple effect. For the first time since the 1960s, people potentially exposed to the coronavirus are being asked to quarantine themselves. Businesses, schools, childcare centers and other institutions are taking steps such as closing offices or transitioning to remote work to protect the health and safety of their employees and communities.
For most of us, and especially for the 32 million workers who do not have paid sick time, the idea of missing work because of an illness or a shutdown is financially daunting. What do you do if you are suddenly and unexpectedly unable to work and you have no income? These five steps will help you stay as financially healthy as possible if you experience an interruption or loss of income.
5 Things to Do If Your Income Is Interrupted
#1 — Assess Your Budget and Prioritize Your Expenses
You will want to know as much as you can about your budget and expenses. If you don’t have a budget, you can start planning for your monthly expenses by using this worksheet.
Identify and total up all income sources and assets such as savings that may be able to get you through until you can resume working or replace your income. Review your living expenses and eliminate the things you can live without. Reduce expenses in the “essentials” category as much as you can.
You may be able to save money by doing things like planning your meals to save money at the grocery store, or reducing your electric bill by cutting energy usage
You may also be able to save money on your debt by finding options to lower interest rates or reduce monthly payments
If you are feeling stressed by debt, exploring options such as debt management plans or working with a credit counselor could help you reduce monthly payments and reduce the overall cost of your debt
If you are concerned about the financial impact of an income loss and you are currently working, get ahead as much as you can by building up your emergency savings.