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(From the Financial Literacy Blog) – If you’ve been keeping up to date with the news, checking what’s trending on Twitter, or simply listening to what the masses are conversing about, you’re well-aware of coronavirus (COVID-19) and the threat it poses. The virus can cause a respiratory illness, but along with having an effect on health, COVID-19 can have an effect on wealth. There are ways you can prepare yourself for the financial impact that coronavirus may have on you:
Build Your Emergency Fund
According to CNN Money, only 29% of Americans have the recommended 3-6 months of expenses saved away. Even more concerning, 40% of Americans can’t cover a $400 emergency expense. On top of that, roughly a quarter of U.S. workers don’t have paid sick leave. If you contract coronavirus and can’t work, or your place of employment is shut down for preventative measures, having an emergency fund could help prevent you from falling into debt. Additionally, while testing from the Centers for Disease Control and Prevention (CDC) is free, treatment for coronavirus could cost you. If you don’t currently have an emergency fund, do what you can to start building one today:
Automate Your Savings
To avoid any missteps in reaching your emergency fund goals, consider automating as much as you can. For example, if your goal is to take $50 from your paycheck every week and add that to your emergency fund, adjust your payroll settings so that amount automatically funnels into an account at your local credit union. With the money being automatically transferred, you won’t be able to impulsively spend that money on something else.
Save Your Tax Refund
Stashing away 3-6 months of expenses doesn’t happen overnight. It can take a significant amount of time, sacrifice, and determination. If you’re looking to expedite the saving process, consider taking your tax refund (if you received one) and moving it all to your emergency fund. Remember, the government isn’t sending you a bonus check, but money that has been yours all along. Instead of making impulsive purchases with it, use the return to strengthen your financial life and save it away for the unexpected.
Cut Back on Non-Essential Spending
How many 30-day free trials have you signed up for and forgot to cancel? Are you going to the gym often enough to justify your monthly membership fee? Take a look at some of your recent credit union statements and figure out exactly what you’re paying for every month. The costs of television packages, magazines, and other subscriptions add up, and can become more costly than you anticipated. If you aren’t taking advantage of it, cancel it. If you still utilize the services, conduct some research to see if there are cheaper options or alternatives. If you still have cable, consider cutting the cord. By taking a few minutes to assess where your money is going, you can save yourself from spending more than you need.
Avoid Scams
As cases of coronavirus continue to spread across the globe, scammers are cashing in on people’s fears and uncertainty. The outbreak is a dream come true for cybercriminals who hope to illegally profit by offering fake cures, sending phishing emails, and organizing fraudulent fundraisers. There is currently no vaccine for coronavirus, so any offer for a cure should be an immediate red flag. Don’t click on any links from sources you don’t know, as a harmful virus could be uploaded onto your phone or computer. Many cybercriminals are sending emails that claim to be from the World Health Organization (WHO) or CDC . While the email may look trustworthy, the safest way to get up-to-date information is to go directly to the WHO or CDC websites. If you want to donate to coronavirus research and prevention fundraisers, do your homework and make sure the charity or crowdfunding website is legitimate.
Utilize Credit Union Perks
In the event coronavirus cases rise in Maine and your local credit union’s branch closes temporarily, the money in your savings and checking accounts will remain safe and secure. For access to your funds, you can take advantage of online and mobile banking, Shared Branching, and the state’s largest surcharge-free ATM network.