Hi, I’m Dave Frank, a Financial Advisor with Kramer Wealth Managers. I know we are all in a difficult situation right now. The important thing is to take control of it. Right now, America is in an “economic coma”. The virus has spread and unemployment has jumped. America has provided “life support” but we don’t know when the virus will subside but when it does disappear, America will be able to come out of the coma. When you receive the stimulus check, try to use it for necessary items such as food, medicine, rent, mortgage- that kind of thing.

If you have lost your job, you can file for unemployment benefits. In the past, independent contractors such as interpreters and self-employed people were not able to file for unemployment but now they can because of the new law that was passed. If you really have to, you can try asking friends or family to borrow money first because there would be no interest. If you can’t do that, you can try applying for a loan. If you can’t get a loan, you can withdraw money from a retirement account or college fund but try and keep the amount small and for essential expenses only such as mortgage, utilities, and that type of thing.

If you are still struggling to make ends meet, you can withdraw up to $100,000 from your IRA and it can be paid back within three years to avoid paying tax on it. Of course, it is important to pay your bills on time and avoid debt. Try to focus on the most important bills first such as mortgage, rent, utilities, and car loans before focusing on lesser important bills such as medical bills. With credit cards, it’s important that you at least make the minimum payment on time to avoid late payment penalties.

If you can’t afford to make your payments, you can try contacting your mortgage lender and asking if you can provide a reduced or deferred payment. But know that if you defer payments – for example for three months- after those three months – you must pay all three months in full. You can try the same thing for car loan payments, credit cards, and home equity loans. If you have a job, you can consider refinancing your mortgage because interest rates are low right now.

First, check with your financial advisor to discuss your investments and see if changes are needed or not. You can also check, if you have excess cash that you don’t need in the short term and you are in a comfortable situation, you could consider investing to buy more shares at a lower cost. Know the difference between needs and wants. Needs are having a safe place to live, food, clothing, access to affordable health care. You can cut down on other costs such as entertainment, restaurants, vacations, gifts, sports, etc.

If you already have cash reserves, try not to touch it and leave for future needs, if you can. But if you can’t, you can take out some for paying bills. If you still have a job, try to build sufficient emergency funds that will last for six months worth of expenses.

I know most are stuck at home. You have a good opportunity to reassess your budget and find a way to cut down some expenses and you can also teach kids smart money management too. Stay safe. Stay home. Save lives.