The pandemic has done a number on us, in a myriad of ways. In fact, you’d be hard-pressed to find anyone who hasn’t been affected by the COVID-19 outbreak, which, among other things, has caused scores of people to struggle financially. If you’re one of those Americans, here’s how and where to get COVID-19 financial help.
For the record, Congress passed multiple bills aimed at giving U.S. residents financial support during the pandemic. Those resulted in direct payments of $1,200, $600, and $1,400 to qualifying recipients.
The government also extended unemployment benefits and continued moratoriums on eviction and foreclosure through last July. Further, payment deferments on most student loans were extended through August of this year, so there’s still time to get one.
Help for Small Businesses
The CARES Act, which was part of the federal government’s first stimulus package, included the Paycheck Protection Program. The initiative was aimed at helping small businesses financially affected by the pandemic to pay employees and certain expenses. The PPP subsequently got a $7.25 billion boost and was expanded to include a variety of nonprofit organizations, which continue to benefit from the federal help.
Further, the Restaurant Revitalization Fund grant program, established by President Biden’s stimulus plan, issued nearly $29 billion in grants to qualifying entities. Moreover, another $15 billion was set aside to continue funding Economic Injury Disaster Loans. The good news is that these programs will remain in effect until funds are exhausted. In fact, here’s an excellent overview of government debt relief programs that you can also use.
Assistance from Lenders
For the most part, lenders have not just continued with business as usual during this historic pandemic. The fact is that nearly every lender has provided some manner of assistance for borrowers financially hurt by the viral outbreak. Across the board, mortgage lenders, credit card issuers, student loan servicers, and others are helping by waiving interest and fees, deferring payments, or even assisting with applications for small business or personal loans. The latter should only be used as a last resort, however, since you don’t want to make a bad situation even worse by going further into debt.
If you’re financially affected by the pandemic, contact your lender now rather than miss payments. There’s likely some help available to you.
Withdrawing from Your 401(k) Sans Penalties
Through Dec. 31, 2020, you could take out a maximum of $100K from your retirement fund without penalty. While that window has come and gone, if you did withdraw cash prior to the deadline, you may not know that you have three years to pay the IRS for taxes owed. The rub is that you or a member of your family must have contracted COVID-19. Either that, or the pandemic must have caused you to experience “adverse financial consequences.”
Rather than look to the government or your lenders for assistance, there are moves you can make to help yourself out of a financial situation caused by the pandemic.
As we say, if you have a nice-sized account, you could tap into your 401(k) via a loan or hardship withdrawal. Generally, it’s not a great idea to hit up these funds that are set aside for your retirement. However, doing so is among emergency actions you can take to manage debt if you’re experiencing a serious financial crisis.
Also, if you’re like a lot of people and are now working from home, perhaps you can have your insurance costs reduced. Reach out to your auto insurance carrier to see if there are any options available to you.
This is also a good time to review your spending habits to see where you might be able to cut back. Establish a budget to see how much you’re spending monthly, and where. Those gourmet coffees that you buy each morning, yes, they do add up, as do those too-frequent dinners out.
Further, if you haven’t established one already, now is the time to create an emergency fund of at least $1,000. It may sound counter intuitive to put money aside when money is what you need, but what you don’t want is to have to pull out the credit card for life’s inevitable unexpected events, a car repair, say. You don’t want to need more money and be deeper in debt.
Hopefully you can use this resource about how and where to get COVID-19 financial help to get you back on solid financial footing during this protracted public health crisis. If you’re already in over your head in unsecured debt, you may want to consider debt settlement through Freedom Debt Relief.