NEW YORK — The COVID-19 crisis resulted in the worst economic downturn since the Great Depression.
According to the United Nations Department of Economic and Social Affairs, the unemployment rate jumped from 3.5% in February 2020 to 14.7% in April last. Then, the rate went down to 6.0% last month.
Experts say now is the time to get your money in order.
Wendy Barlin is an accountant who specializes in advising people how to better manage their money through careful financial planning.
She shares tips on how to rebuild, repair and plan your financial future.
Take it slow
As restaurants, concert halls and movie theaters begin to open again, be careful not to jump in too quickly. If you love trying new restaurants, set a goal to try one a month, not five.
Repay 2020 Debt
Balance your debt repayments with savings for a rainy day. If you pay down all of your debt, then if you lose your job or need a surgery, you won’t have money saved to cover expenses — and you will end up in debt again. Slow down your debt payments and balance it with savings!
Rebuild your credit
If your credit score took a hit in 2020, now is the time to get it backup. The perfect credit score is made up of a car payment, rental or mortgage and 3 active credit cards. To build up credit again, you want to use credit cards and pay them down each month.
For those out of work, she suggests looking for a job now. Don’t wait until unemployment runs out in a few months – when everyone will be looking for a job. Employers are hiring now. Remember, unemployment doesn’t last forever.
Create A Weekly “Money Day”
Set up a weekly 30-minute money day. This is one day a week where you will take care of your money, the same way you brush your teeth or workout. Look at your bank accounts, make a cash flow plan for the week by assessing money in and out, check upcoming bills or expenses and come up with an overall spending plan.
If you were fortunate enough to work during the pandemic, you likely have racked up some savings from stay-at-home orders. Don’t spend it! Instead, try leveraging your money; invest it, or buy a home! (Anything except leaving it in a checking account, earning no interest).
Follow these tips, says Barlin, and you’ll be well on your way to securing your financial future.