Information provided by Redstone Financial Credit Union
Here in Middle Tennessee, many residents have been hit hard financially by either the devastation of the March tornadoes, the COVID-19 healthcare crisis, or some by both. We spoke with Redstone Financial Credit Union to get some tips for staying afloat financially if you have lost your job due to COVID-19 business closures.
Many Americans have been laid off or lost their job after businesses closed their doors in an effort to stem the spread of COVID-19. If you are one of the millions out of work because of the pandemic – don’t lose hope. There are ways to stay afloat financially until you’re working again.
First, apply for unemployment benefits. A $2 trillion federal stimulus bill expands unemployment benefits to some non-traditional workers, such as the self-employed, independent contractors or gig workers. Apply as soon as possible because the increased demand for benefits is likely to cause filing delays.
• In Tennessee, residents should go to: https://www.tn.gov/workforce/unemployment/ apply-for-benefits.html
• In Alabama, go to https://www.labor.alabama.gov/
Contact your creditors and your financial institution to let them know about your financial situation. Many banks and credit unions are offering assistance to persons in financial distress, with low-interest emergency loans, skip-a-pay, loan and modifications. For its existing members, Redstone Federal Credit Union offers customized solutions, in addition to other assistance.
If your mortgage loan is federally backed and you’re experiencing a hardship caused by the pandemic, lenders should allow you to make reduced payments or skip payments for a set amount of time – a process called forbearance. Fannie Mae, Freddie Mac, FHA, VA, and USDA loans are eligible under the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.
If you have federal student loans, suspend your payments. Student borrowers have the option of suspending their payments – with no interest – thanks to the CARES Act. Contact your loan servicer for information on how to get the process started.
Even after receiving unemployment pay and modifying your current debt, you should also begin cutting expenses.
“Review your finances. Consider how much you have in savings and what you receive from your unemployment claim, then add up all your expenses,’’ said Mike Panesi, Redstone’s Tennessee Market Vice President.
“If you have a shortfall, you need to decide what expenses to cut. There are some near painless ways to cut expenses. Start there and become more stringent if your unemployment lasts longer,’’ Panesi said.
Look at premium cable stations, gym memberships, subscription services, and “online shopping while bored.’ In addition, try not to take on any new debt.
Redstone, with branches in Murfreesboro and Fayetteville, TN, offers helpful personal finance information on its website at redfcu.org/financialwellness.
Pay the minimum due on your credit cards. During conventional times, you want to pay off your credit card balance each month, while also putting money away in an emergency fund. But if you have lost your job during this crisis, make your credit card payments on time, but only pay the minimum due. You can then use any remaining money for living expenses.
Take advantage of community programs. Dial 211 or go to 211.org and connect with community agencies that can help with anything from financial assistance, food banks, legal questions, and more.
‘’This coronavirus crisis has shown the true spirit of our community and we will continue to work together and get through this together as a community,’’ said Panesi.
For more information, contact Redstone Federal Credit Union at redfcu.org or 800-234-1234.