Budgeting for a Crisis: Tips on Financial Preparedness
Canceled events, altered routines, and heightened anxiety about our own health and financial well-being are just a few of the shockwaves felt during a global pandemic. Even with the outpouring of assistance from companies, government, and other outlets, it can seem all-consuming to stay on top of your budget and pay every bill on time. Here are a few tips to help ease those concerns during these unstable times:
Tip #1: Focus on the Big Picture:
Remaining level-headed while reviewing your financial situation is the first step in taking control and avoiding any further unnecessary hardship. Acknowledge what has you in this predicament – did you lose your job? Have there been abrupt and unforeseen costs recently? The answers to these questions will help you establish better habits for your financial future. Also remember that there are people there to help you. One of our team members would be more than happy to help you work through your financial situation with you.
Tip #2: Prioritize, Prioritize, Prioritize
Take a look at your monthly expenses. This includes bills and other discretionary spending. Rank each of these items in order of necessity and/or ability to delay payment to give yourself a clearer picture of any immediate actions you are able to take. Rent or mortgage payments should be at the top of the list, along with essential utilities – water, electric, etc. – while monthly memberships to clubs or fitness centers, irregular or frequent dining out experiences should be put off until you’re in a good financial place. Remember to set aside a healthy reserve for groceries and other essential items. This is what is known as your rainy-day fund. Rainy-day funds are crucial, especially when there is no timeline for the rain to end.
Tip #3: Be Wary of Wolves Cloaked in “Free” Money
Many large companies have created programs to assist their customers and members with payments, loans, etc. Delaying monthly payments and allowing you to get back on your feet is one method these companies are implementing. However, be sure to resist banking on this as “free money,” as those payments will, in most cases, be due at the end of any grace period or tacked on to the end of a loan. Don’t allow yourself to get used to the extra money you have, as your budget should be dependent on you never receiving assistance. Also be sure to stay smart and know if it sounds too good to be true, it probably is. Critical times like these are breeding grounds for scammers to prey on the vulnerable and the desperate. Use your head, and don’t seek more assistance than you really need to protect yourself from being scammed.
Tip #4: Use Kansas City Credit Union as a Resource!
We’re here to help! KCCU is thrilled to offer our knowledge and expertise for your advantage! From understanding your loans to considering a refinance, we can’t wait to help guide you through making the best choices for your financial security. Contact us today to start on your path to financial freedom and peace of mind!
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