COVID-19 has brought about a new perspective on government assistance and aid.
While concepts like Universal Basic Income were foreign a year ago, they’ve now been thrust into the national spotlight, especially in seeing how effective things like PPP and PUA have been ensuring everyone gets a paycheck. Additionally, things like restrictions on cashing out your 401k have been pulled back on, finding ways to open spending in as many avenues as possible.
Although these benefits have been great, they also could possibly expire as early as this summer. Despite that it would be politically advantageous to keep pushing them along (especially during an election season), it’s ultimately up to congress’s next session to see what might be extended. That’s why we’ve put together a short guide on planning for the rainy day that all COVID-19 benefits run out. Check it out below:
Create a list of expenses.
It’s always smart to do a quick check of what expenses you have, including if any have been piled on in the past couple of months. While COVID-19 benefits have freed up spending in certain areas for people, that doesn’t necessarily mean everything you’re buying is a necessity. Although it’s unfortunate, starting to build a little bit more of a conservative mind for spending can bode well-long term to ensure you can still have benefits to live off.
Learn where spending has decreased.
In reconciling your budget, it’s important to note where your spending has decreased, as well as why those patterns exist. Perhaps it was a decrease in gas or airfare due to work travel, or an extracurricular expense like going out to lunch every day that really was making a dent in your budget. As we plan for COVID-19’s lockdown to decrease over the next few weeks, make note of which decreases might have the chance of perking back up again, as well as what things you can do without.
…with an election year coming up, extending benefits could play in favor for both parties…
Decide what spending may increase.
On a similar note, it’s also important to make note of what spending you might increase once things get back into full swing. For example, if your car might need some maintenance you were putting off, put that into your budget for planning. Give yourself some breathing room on the things that could start to add up as we get back into our normal day-to-day.
Assess how much you can start putting aside right now.
It’s never a bad idea to save for a rainy day, but especially when you’re able to take advantage of these unprecedented benefits. These can be a great foundation for debt consolidation or savings, which would effectively free up some capital for you to use from an improved credit rating. Take some time to map out what type of cash reserves you can build up before the end of the summer, especially in the event that no more benefits are passed.
Don’t panic if it doesn’t’ come together perfectly.
Finally, as we’re all dealing with a crisis we’ve never seen before, it’s important to remember not to panic if things don’t turn out quite as planned. Most likely whatever you’re experiencing is something a massive scale of others are dealing with as well, which will culminate hopefully into action or legislation. Especially with an election year coming up, extending benefits could play in favor for both parties, and if things get bad enough, they might not have a choice regardless.
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