The Coronavirus outbreaks in the United States have created job insecurity and caused many to experience hurdles that negatively impacted their financial health. The key to rebounding from financial loss is a psychological process. Financial health will vary throughout one's life, so the crucial point is to learn to navigate the losses and wait them out. Here are some tips and advice about how to bounce back financially.
How to Manage a Financial Crisis and Bounce Back Financially
1. Take a Deep Breath and Think It Through
Many people who achieve financial literacy are taught skills like how and what to invest their money in, the value of saving money, and the way to acquire good credit. Others never learn these lessons due to a combination of consumer culture, parents who were poor financial role models, or a profession that emphasizes achievement in terms of fame (such as the arts) vs. riches.
While mainstream society would often like to preach that financial failure is the individual's fault, this simply isn't true. Individuals are subject to job fluctuation, varying levels of financial skill, and some are born without any money and fewer educational opportunities. The first rule to financial survival is to look at the causes beyond your control. When it's possible to see the big picture, then it's easier to conquer paralyzing guilt and shame.
2. Recalibrate Spending Habits and Apply for Unemployment
If this is the first time you lost a job, then file quickly for unemployment benefits. Unemployment insurance is there to protect workers who are between jobs. The amount of money is a portion of one's former pay, so it's time to avoid superfluous expenses. Do you frequently eat out, compulsively shop for clothing, or have other habits that add up? During a period of unemployment, it's crucial to spend less in these areas while trying to bounce back financially.
It requires discipline, but consider the entire situation like waiting out a storm. The situation will change, but you will have to prioritize carefully, or your situation could get worse. If you continue spending money on luxury goods while unemployed, there is a chance that you will not have money left over for the big expenses like rent, a mortgage, or a car payment.
3. Do Some Research About Ways to Save on Food
The federal SNAP (Supplemental Nutrition Assistance Program) is designed for low-income Americans and provides them with a subsidy of money to spend on food. The benefit amount depends on one's income level and could range anywhere from twenty dollars to hundreds. The money does not have to be repaid to the government.
Many cities will often have food pantries set up by nonprofit aid groups, churches, schools, and other groups determined to help a community. Some of these places don't even ask any questions about one's income. If you need help finding food pantries, then do an Internet search or call the Department of Human Services (DHS). There will be information about food pantries out there.
4. Consider Switching Insurance Policies to Help Bounce Back Financially
If a person is given a severance package, then they may still receive insurance benefits. However, depending on where someone is in terms of reaching their deductible, it may be time to switch to Medicaid. If you use the employer's insurance and have to go to a hospital, clinic, etc., then there's a chance you would be unable to cover a copay. Medicaid and Medicare provide free or greatly reduced medical services for those struggling financially. If possible, switch to government insurance and avoid more debt.
5. Avoid Self-Destructive Behavior and Vices
The reason why people experience depression and anxiety during financial changes is they have less money to spend on the things that make them happy. When this happens, it's going to take some soul-searching. However, chances are that you already have bought things to keep you busy at home. When people are busy, they do things like buy movies they don't have time to watch, books they can't finish, and other things related to their hobbies.
Learn How to Bounce Back Financially
Instead of drinking or wallowing, it's going to be important to stay busy. Dedicate a certain portion of your time to a job search, but spend time during the day working on these hobbies. If you plan your days and schedule activities, it's going to make you feel less anxious. By the time you find a new job, you will have become a more resilient, stronger, and more mature person. Remember it's only temporary.