Hey guys, I had the privilege of being able to attend a workshop hosted by the Wall Street Journal featuring The Finance Bar’s Marsha Barnes. The topic of discussion was managing money in a crisis (*cough COVID-19) and I’d like to share what I took away from it.
1. Staying Afloat
During this unpredictable period in time, the goal should be to stay afloat. Really look at what you need to get by. Whether you’ve been laid off, unaffected by COVID-19, or anywhere in between, it’s still worth the time to take a look at your income and expenses. One of the exercises that Ms. Barnes suggested was to approximate all your expenses based on categories such as housing, utilities, food, debt and even savings. Then, go through all your documents and try to find the actual cost of these expenses. When compared to their actual monthly income, it can serve as a good reality check to see if you can actually afford your lifestyle. It can also highlight the difference between where you think your money is going and where it is actually going.
2. Seek as Much Help as Possible
Save first, debt later. Before the pandemic you might have been really working at paying off debt or saving for retirement. Now that things have changed, you might find that you aren’t able to do that as much as you were before. “Show yourself some grace” was definitely emphasized. Many people are struggling at this time, so you shouldn’t feel so bad about struggling too. Creditors and other agencies are aware of this too. Seek as much help as possible, when you read about financial advice here or anywhere else. Don’t just learn but do some research and act on it. For example, just reaching out to your creditors, explaining your circumstances, and exploring your options can go a long way. There are also government programs that can assist you. If you’re an ACC student reading this, you have access to the CARES Act.
3. Take Financial Advice as You Need
Of course with any financial advice, not all of it may be applicable to you. For example, you might have heard the advice to have 3-6 months of expenses saved in an emergency fund, but of course the pandemic has been going on for a lot longer than that. Ms. Barnes suggests us to “trust our gut.” If you’re worried about not having enough in your savings account, it’s perfectly fine to put more than just the 3-6 months worth. Of course, if you do want more specific advice, you can schedule an appointment with a financial coach from ACC here.