From Metro
As recently as February, few people might have expected 2020 to unfold the way it has. A thriving economy and low unemployment numbers helped 2020 start off on a prosperous foot. But by mid-March, uncertainty set in.
The World Health Organization declared a COVID-19 pandemic in March, and the ripple effects of that were profound. Since the novel coronavirus began spreading across the globe, millions of people have lost their lives, millions more have survived the virus after lengthy hospital stays and hundreds of millions more lost their jobs. Estimates from the International Labour Organization in June 2020 suggested as many as 400 million full-time jobs were lost due to the COVID-19 outbreak.
Such widescale job loss left millions of people wondering how they were going to pay their bills while out of work. Though there’s no magical formula to help people make it through a recession unscathed, learning to prioritize bills can help people stay on the right financial track even after losing their jobs.
• Make sure the necessities come first. The credit reporting agency Experian notes that health and safety should always be a person’s top priority in a tough financial situation. Food and shelter should take precedence, so always pay for food and housing costs first. Change your eating habits to dine out less and make grocery lists before visiting the store so you’re less likely to make potentially costly impulse buys while shopping. A 2018 survey from Slickdeals.net found that 70 percent of consumers’ impulse buys are spent on food, so creating a grocery list can help people save substantial amounts of money. In regard to housing, if you’re accustomed to paying additional principle on your mortgage each month, continue to do so only if you can still afford it.
• Don’t cut costs in regard to medical care. Make sure you keep your medications up-to-date and continue to visit your health care provider. Medical debt is a substantial problem in the United States. A 2019 study published in the American Journal of Public Health found that roughly two-thirds of all bankruptcies in the United States were tied to medical issues. Unemployed professionals should keep in mind that medical issues may prevent them from reentering the workforce when the economy recovers from COVID-19, so it’s imperative that medical care and maintenance continue to remain a priority even in difficult financial times.
• Eliminate high-interest debt if possible. High-interest debt such as credit cards can snowball if consumers miss payments or are only capable of making minimum monthly payments. If you have been laid off or are working on reduced wages but have a sizable amount of money in savings, consider eliminating your high-interest debt. Doing so can reduce the stress stemming from the pandemic-related financial uncertainty and it also greatly reduces the amount of interest you’ll pay on bills you can afford to pay off.
Many people have been forced to prioritize their bills as they confront the economic fallout of COVID-19. Prioritizing necessities and personal health can help people overcome the financial challenges of the pandemic.