When I’m budgeting through times of disaster — at a personal or global scale — the way I budget changes a little. Yes, I still try to employ the Golden Rule of Budgeting.
Yes, I still try to meet all of my obligations.
But my goals change. In times of prosperity, your goals may be to save for tomorrow. To pay bills based on their sequential due dates.
But when pandemic’s looming outside the front door, life’s just different.
Here are some things to think about as you construct your new budget after all the upsets of March.
NOTE: If you’re among the lucky who are still feeling comfortable, these considerations may not apply to you in as great of a degree or at all.
Disaster Budget Goal #1: Avoid homelessness.
When you’re homeless, your entire life becomes about not being homeless. Because being homeless makes everything else damn near impossible.
As of this writing, know that in many cases, your landlord cannot evict you. If they have a federally-backed mortgage, they cannot evict you until September 23rd, 2020.
What if the mortgage isn’t backed by the federal government?
There’s this big argument for state governments fending for themselves right now. For the record, America tried this system hardcore in the 1700s with the Articles of Confederation before writing our current Constitution. It didn’t work.
No joke: Shay’s Rebellion, one of the turning points in abandoning the Articles, was literally about people in Massachusetts being pissed off that they weren’t protected from foreclosure.
The middle of a pandemic seems like a bad time to open the experiment back up on such a grand scale.
But here we are.
If your landlord’s loan isn’t federally backed, you’re subject to your state or local laws. You may have stellar protections. You may have none.
I don’t know of a centralized place to find this information, which is a common and unfortunate consequence of decentralization.
NOTE: If you live in Pennsylvania, you can currently apply for COVID rent assistance. There may or may not be a similar program in your state.
You don’t want to wait until September to pay your rent.
As a part of the CARES Act, your landlord can’t impose any fees or penalties for you being late. Again, if they have a federally-backed mortgage.
While there are progressives in the legislative branch pushing for total forgiveness of rent payments, as of this writing, there’s still the issue of owing back rent.
Unless you have a really cool landlord who has a lot of financial wiggle room themselves, it’s going to be ideal to keep on top of your rent if you can, even if you don’t technically have to. If you don’t, it could pile up to one massive sum due later this year.
This ideal may change if you have some programs to help you on a state or local level.
Hopefully more stuff will pass through Congress to help all of us. But right now, you can’t bank on all that.
When I’m facing down a financial crisis, I prioritize rent. Unless there is a change in law, I’d still keep this expense at the top of my budget.
Disaster Budget Goal #2: Secure food.
Going to the grocery store is jarring. Those empty shelves. The masks. The lack of social distancing and dairy products.
But I still haven’t figured out a way to get things delivered or even scheduled for pick up in the midst of this pandemic. It seems to be the ability to pay for your food a few days or weeks ahead of time and a matter of timing your purchase attempt just right. I have yet to succeed.
I get my money in bursts. It’s not super regular.
So when I’m getting money in, I’m planning out our food needs for as long as fiscally reasonable. This doesn’t just help me get maximum peace of mind in one big trip to the store; it also minimizes my trips to the store and therefore exposure.
Disaster Budget Goal #3: Keep your health insurance.
Health insurance is expensive. Really expensive. It’s contributed to some of my debt.
Things with the health insurance got so bad that earlier this year I seriously considered cancelling my policy. The premiums have gotten higher and the network my provider grants me access to has shrunk.
I was getting frustrated with the hundreds I was throwing at them every month just to have to dispute every bill for some error, anyways.
I’m so glad I didn’t quit my senses in that financially-exhausting moment. If I had cancelled earlier in the year, I wouldn’t be able to repurchase a plan now. The President has told us so.
We’re living in the age of COVID-19, pre-vaccine. Odds of hospitalization and death go up if you’re older, but they’re definitely not zero for those of us under 50.
Add into the mix the fact that in America, it’s super common to get turned away for services if you don’t have health insurance. And in some cases it’s perfectly legal.
Oh, and on top of that, this is a really good time to have mental health benefits. If you don’t or even if you do, check out these tips from www.betterhelp.com to combat all that anxiety while we’re all stuck indoors.
Paying my premiums means I’m going to have more access to care, and my insurer will hopefully cover their portion of any treatment should I need it.
Treatment for COVID-19 is not free, by the way. Though testing is.
I did the math: a full battery of coronavirus testing costs at minimum $1,331.— Rep. Katie Porter (@RepKatiePorter) March 12, 2020
I also did the legal research: the Administration has the authority to make testing free for every American TODAY.
I secured a commitment from a high-level Trump official that they’d actually do it. pic.twitter.com/RmolCtmNbG
NOTE: If you’ve recently lost your job, you do qualify for a Special Enrollment Period, and you may want to consider Medicaid depending on where you live.
Disaster Budget Goal #4: That’s enough goals.
You’re running on a budget with potentially no income. Maybe some government benefits.
I mean, when/if those benefits come in.
Because good luck getting through to the welfare office to follow up on your application right now.
The point is: You don’t need more goals. Get the basics covered. Then grant yourself some realistic grace.
That doesn’t mean you should ignore other bills. Manage them as best you can.
In fact, reaching out to the people you owe money to is recommended. They might have a plan to help you out, and are less likely to be punitively harsh with fees and penalties if you let them know what’s going on ahead of time.
I do have some other priorities in my disaster budgets like:
- Medicine — though that’s a part of my healthcare budget category.
- Certain insurance premiums. The ones that are important to you will depend greatly on your life circumstances.
- Assets which could be repossessed. In past personal or national disasters, I’d be worried about my vehicle as it was my primary way to earn an income.
- Utilities, for the same reason as rent. Even if you can get payments deferred today, you may still owe them eventually. I don’t even want to see that lump sum bill.
- Business expenses, but only those which enable me to continue earning an income. I am super lucky to be in a situation where I still have some work. Just like I’ve been very concerned about my vehicle in the past, expenses for online tools that allow me to do my job are of vital importance.
What’s up next highest on your radar may look completely different than mine. That’s the beautiful thing about the ‘personal’ in personal finances.
Focus on the most important bills.
I’d argue that if you’re looking for some of the most important places to divert extremely limited resources right now, you should looks towards housing security, food security and access to some type of health insurance.
If you can get those things covered, you have a much better chance of recovering from all this economic turmoil.
For everything else, I need you to remember: This is not your fault. None of us could have predicted this, and if anything, it’s your government that is failing — not you.
I’m not saying it’s not going to be bumpy with the rest of the bills. Or even that meeting these three priorities is always going to be humanly possible.
But if you can prioritize the bills that are of core importance, it’s incredibly likely to make this unpredictable journey a heck of a lot less difficult.