Money Moves During A Pandemic: 6 Smart Steps To Save
Unexpected strategies to cut debt, lower bills, and secure your financial future amid economic uncertainty.
6 Money Moves to Make During a Pandemic
The COVID-19 pandemic brought unprecedented economic uncertainty, disrupting jobs, incomes, and daily financial stability for millions. While the future may feel unpredictable, proactive financial steps can help you regain control, reduce debt, lower monthly bills, and safeguard your family’s future. This article outlines six unexpected yet practical money moves drawn from strategies that proved effective during the crisis, adapted for timeless financial resilience.
Whether you’re dealing with job loss, reduced hours, or simply heightened anxiety about expenses, these actions empower you to act decisively. From leveraging government relief to negotiating with providers, each move offers immediate relief and long-term benefits. Let’s dive into these strategies.
1. Leave Your Family $1.5 Million in Life Insurance; Rates Start at $20/Month
Amid financial strain, it’s easy to overlook long-term protection, but the pandemic highlighted the critical need for life insurance. Imagine the burden on your family if you’re no longer there to cover the mortgage, schooling, or daily bills. Securing a term life insurance policy now provides peace of mind without breaking the bank.
Companies like Bestow offer straightforward online applications that take just minutes, no medical exam required for those under 54. You could qualify for up to $1.5 million in coverage, with rates starting around $20 per month. This low cost—less than a daily coffee habit—ensures your loved ones aren’t left in financial distress.
- Why now? Economic volatility increases the importance of preparedness; life insurance locks in affordable rates based on your current health and age.
- How to start: Get a free quote online, answer basic health questions, and activate coverage instantly.
- Benefits: Covers debts, provides income replacement, and funds education—essential during uncertain times.
Don’t delay; rates rise with age, and health changes could limit options. This move isn’t just insurance—it’s a legacy of security.
2. Stop Paying Your Student Loan Debt
Federal student loan borrowers received a game-changing relief through the CARES Act, suspending payments and interest accrual. Originally set until September 30, 2020, similar pauses have been extended in various forms, offering breathing room for budgets strained by pandemic fallout.
This isn’t debt forgiveness—you still owe the principal—but halting interest (often 5-7%) prevents balances from ballooning. Redirect that monthly payment (average $393) to high-interest credit cards, car loans, or emergency savings.
- Eligibility: Federal loans only (check via studentaid.gov); private loans may not qualify.
- Action steps: Log into your account to confirm $0 due; set payments to auto-zero if needed.
- Pro tip: Use the pause to build a 3-6 month emergency fund, accelerating overall debt payoff post-pause.
Verify current status with the U.S. Department of Education, as policies evolve. This temporary reprieve is a strategic pivot to tackle more urgent debts first.
3. Tell Your Car Insurance Company You’re Not Driving as Much
With lockdowns and remote work, driving plummeted—up to 50% in some areas—prompting insurers to offer refunds and discounts. Major companies issued billions in credits, averaging $100-200 per policyholder.
Even post-pandemic, if your mileage dropped (e.g., no commute), contact your provider for usage-based discounts or low-mileage policies. Some offer telematics apps tracking habits for personalized rates.
| Insurer | Potential Savings | Offer Type |
|---|---|---|
| Progressive | $100+ | Mileage discount |
| Geico | 15% credit | Usage-based |
| Allstate | $50-150 | Refund check |
Call or use apps to report reduced driving; mention remote work. Pair this with home insurance reviews—even utilities offered discounts. Small wins compound to free up hundreds annually.
4. Ask Your Utility Company for Relief
Overlooked but impactful: utilities like electricity saw usage shifts during stay-at-home orders. Many providers rolled out payment plans, extensions, or bill credits without fanfare.
Proactively reach out—explain your situation (e.g., job loss)—and inquire about moratoriums on shutoffs, which were widespread during the crisis. Budget billing averages monthly usage, smoothing peaks.
- Common relief: Deferred payments, reduced deposits, energy efficiency rebates.
- State aid: Programs like LIHEAP (Low-Income Home Energy Assistance) provide grants.
- Long-term save: Audit usage with smart meters; switch to LED bulbs for 75% energy savings.
A quick call could slash your next bill, preserving cash flow.
5. Strike a Deal With Your Credit Card Company
Credit card debt, with APRs averaging 20%+, spirals quickly in downturns. Issuers offered hardship programs during the pandemic: waived fees, lower rates, reduced payments.
Prepare before calling: note your balance, income drop, and request specifics like 0% interest for 3-6 months or waived late fees. Success rates were high amid mass applications.
- Ask for: Payment deferral, rate reduction (e.g., from 22% to 10%), fee waivers.
- Script: ‘Due to pandemic-related income loss, can we adjust terms for 90 days?’
- Credit impact: Minimal if payments continue; avoid maxing cards.
Document agreements in writing. This buys time to stabilize without credit damage.
6. Ask For Help
Pride aside, unprecedented times demand unprecedented actions. Lenders, landlords, and utilities paused evictions/foreclosures via CARES Act, but penalties loomed without outreach.
Provide proof (layoff notice, reduced hours) for forbearance on mortgages, rent, or loans. Non-profits and government aid (e.g., SBA disaster loans) fill gaps.
- Key contacts: Mortgage servicer, landlord, 211.org for local aid.
- Bill categories: Housing, utilities, phone, auto—most offered relief.
- Mindset shift: Help preserves credit, avoids collections, and rebuilds faster.
One conversation can prevent debt avalanches. You’re not alone—resources abound.
Frequently Asked Questions (FAQs)
Q: Are student loan pauses still available?
A: Check studentaid.gov for current federal relief; extensions have occurred post-2020.
Q: Will negotiating with creditors hurt my credit score?
A: Hardship programs typically don’t if payments are maintained; forebearance reports vary.
Q: How do I qualify for low-mileage car insurance?
A: Report reduced driving or use telematics apps; savings up to 30% possible.
Q: Is life insurance worth it during tough times?
A: Yes—affordable term policies protect family finances at minimal cost.
Q: What if I’m not eligible for federal student loan relief?
A: Explore income-driven repayment or private lender forbearance.
Implementing these moves holistically builds resilience. Track progress monthly, adjust as needed, and consult professionals for personalized advice. Financial security starts with action.
References
- CARES Act Student Loan Forbearance — U.S. Department of Education. 2020-09-30. https://studentaid.gov/announcements-events/covid-19
- Insurance Industry COVID-19 Response — National Association of Insurance Commissioners (NAIC). 2020-04-15. https://content.naic.org/coronavirus
- Consumer Financial Protection Bureau Debt Relief Guidance — CFPB. 2023-05-10. https://www.consumerfinance.gov/coronavirus/mortgage-and-housing-assistance/credit-card-hardship-options/
- Federal Reserve Report on Household Debt During Pandemic — Board of Governors of the Federal Reserve System. 2021-02-11. https://www.federalreserve.gov/publications/files/household-debt-and-credit-report-20210211.pdf
- Life Insurance Access During COVID-19 — American Council of Life Insurers. 2020-06-01. https://www.acli.com/News/Pages/Life-Insurance-Industry-Responds-to-COVID-19.aspx
Similar Articles
Read full bio of Sneha Tete
