6.30.20

Get your finances in order after a setback

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Money management tips for regaining financial well-being.

While stay-at-home orders have lifted and people are returning to work, many people are facing the financial consequences of the Coronavirus pandemic. Emergency funds have been depleted. Credit cards are maxed out. Mortgage forbearance relief will run out soon. If you’re dealing with setbacks like these, here are tips for getting your finances back in order.

Determine what caused the setback

Understanding what caused your financial setback can help you determine whether this is just a bump in the road or part of a bigger problem. Did an unexpected repair bill knock you off course? Did you or a spouse lose a job? Was this a result of a medical situation? Asking questions like these will help you see that the problem isn’t a reflection of your self-worth. And, if the problem stems from your own actions, you’ll be be able to take steps to change them to get on a better financial path.

Assess and accept

Tally up both your resources and bills. You may have been avoiding this because the numbers feel dismal. However, the only way to create a viable plan for financial well-being is to understand exactly what money is coming in and going out. Ignoring and resenting financial problems won’t make them go away. Now is the time to accept a bad situation and find a way forward. You can do this!

Identify your priorities

To regain a firm financial foundation or build one for the first time, you have to examine your needs and wants and then create a budget.

Housing, food, child care, transportation, insurance—you need these things to function, go to work and care for your family. Your needs may differ from your neighbors.

Wants are things that are nice to have but not absolutely necessary. Think new clothes, eating out, streaming subscriptions and other optional purchases. Cut, or better yet eliminate, these expenses until your financial situation improves. (Get more tips on cutting expenses immediately.)

Take advantage of credit counseling

As a Consumers member, you have unlimited access to a credit counseling program through GreenPath Financial Management Counseling. The counselors at these services can help you budget, improve your credit score, and help you build a payment history in order to qualify for a loan, perhaps through the Credit Smart program.

Review medical bills

If you have medical bills, check them for accuracy. Are the dates and types of service accurate? If there are discrepancies, call your provider to correct the bill. If you can’t tell what the bill is for, ask for a detailed breakdown of the charges. Also, verify that your health insurance paid for everything covered by your policy.

If you’re unable to pay medical bills, call the provider and explain that you’re experiencing a financial hardship. In many cases, you can negotiate a lower bill and/or set up a monthly payment program that will keep your account in good standing.

Address your medical bills early on. If they get turned over to collections, you won’t be able to negotiate and your credit score could suffer.

Get everyone on board

Money issues affect everyone in your home whether you talk about them or not. Be upfront with your partner and kids. Enlist their help with recovering from a financial setback.

Communication will help everyone understand why the family cut some expenses and activities. Plus, you’ll be a good role model for your kids. They’ll see that it’s better to face financial problems rather than ignore them, and they’ll learn how to work together as a family.

Celebrate your financial successes

Downsizing and restricting your lifestyle can bring down morale. Recognizing small successes is good way to keep morale up and momentum going. You’ll take many small steps as you get your finances in order. Celebrate them! This is another good reason to share your financial situation with your family—you can share the successes, too.

Consumers provides banking services for more than 100,000 members. If you have banking questions, call us at 800-991-2221. We make it easy to bank how you want, when you want.

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Consumers provides banking services for more than 100,000 members. If you have banking questions, contact us.

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