Staying in the Black Throughout the Pandemic
2020 has been an extremely difficult year for many of us – particularly when it comes to money and finances. The coronavirus and Covid-19 pandemic have put financial strain on people from the top down – whether that's companies or individuals. So, it's a good idea to take a proper look at your finances and to do everything you can to keep yourself out of debt, or from sinking into further debt, while money is tight all round. Here are a few pieces of advice that can guide you along the way. Hopefully, they'll come in useful if you ever find that you need them!
Know Your Rights at Work
A huge number of people are losing work right now. Whether that's their company collapsing, them being made redundant, having their working hours reduced or having to accept a lower salary for the same work that they usually do. If you've found yourself in this boat, it's important that you know your rights. If a company collapses, there isn't often much you can do. However, you do have rights surrounding redundancy and changes to working hours or salary if you are an employee. If in doubt, get legal help to ensure that your company has carried these changes out fairly. This will ensure that you get every payment that you are entitled to, which can help significantly during these difficult times.
Claim Owed Money
If you are owed any money, now is a good time to claim it. You don't want to leave things for long, as claiming money back from others can take time and you want to get it back in your hands as quickly as possible. If you are a freelancer, make sure to put clauses in your contracts that note additional fees that will be added for late payments. This will push companies to pay on time when they may be trying to hold onto as much money as possible and delay payments. If you have experienced negligence, injury or illness in the workplace, contact a relevant lawyer and make a claim. For example, if you are in the military and have experienced harm at the hands of a military medical practitioner, you could reach out to a military medical malpractice attorney. Getting any money that is owed to you can help you out during financially difficult times.
Manage Your Debt
If you had debt before the pandemic started, or if you are tied into financial agreements such as mortgage payments or finance payments, chances are you may be struggling to keep up with your agreed payments right now. If this is the case, it's absolutely essential that you contact your lender and that you are open and honest with them. Many companies are being understanding right now, as many of their customers are struggling and they are being lenient in order to help people avoid sinking into further debt or defaulting on payments. It's strongly advised that you follow the steps below as soon as you feel that you are having difficulty keeping up with payments and agreements.
Request Payment Holidays
Many companies are currently offering payment holidays to people with outstanding debt. These tend to be companies that have offered you a mortgage, or companies who have offered some sort of finance agreement. A payment holiday is essentially an agreement that allows you to stop paying your monthly payments for an agreed period of time. You will then pay the money later when your situation has improved. For example, if you have a mortgage on a house and you take a six month payment holiday, you will not pay your mortgage for the next six months. The agreement will be extended by six months, so you will still make the payments – just at the end of your agreement instead of right now.
Request Interest Holidays
Many companies are also offering interest holidays. During an interest holiday, the interest on your agreements will be paused, meaning you will not be charged interest for an agreed amount of time. Companies offering this type of agreement tend to be credit card companies. They may also freeze charges for late payments.
Cut Your Spending
The next step that you can take to stay out of debt is to manage your spending. Now, many of us have already started cutting non essential spending. This is pretty simple and simply requires constraint and self control. But what about necessary spending? The good news is that there are many ways to cut the costs of essentials too. This can mean even more money put aside for when you need it. Here are some areas of focus to get you started out!
Your Energy Bills
Now, you can reduce the energy you use to an extent, making sure you turn lights off in rooms you're not using, turning your heating off when you head out for the day, or using non essential electrical items or appliances less. But you're going to have to spend something on energy. You need energy to get by. Use price comparison sites to look out for the best deals possible. There's no point staying loyal to a company that isn't offering you a great price.
Your Insurance Policies
Chances are, if you have a home, a car, or anything else of value, you have insurance policies. Now, you may not want to cut these out entirely. But again, you can still save a lot of money by switching providers and determining who will provide you the best deal possible. Again, the key to finding the cheapest quote is to play around with different settings on price comparison sites to determine what you can do to reduce your spending. To reduce your car insurance, you may also want to add a more experienced driver to your policy (with their consent).
These changes to make can be simple. So use them whenever necessary. They really can help you to stay out of debt when times get more difficult!