In this coronavirus pandemic, it is little bit hard to pay down debt. Some people had affected to the aspect of their job, hence it seems like the miracle has gone so fast.
Here are 5 ways you can pay down debt, build up your savings and retool your budget while you’re staying at home.
1. Turn Expenses into Savings
Your car sits idle. You just don’t have Ubers. You can’t go to CrossFit or Gym, or Swing. Your regular coffee is now home-made. The same goes on most days, including breakfast, lunch and dinner.
The money you save on day-to-day costs may well be eaten up (literally) by starving kids who are home all the time now. Even if not, use this to shore up the savings for emergencies.
2. Get a Jump on Your Student Loans
Nonetheless, consider the personal situation before you pay off your debt during the forbearance period.
The need for your capital somewhere may be more immediate. For example, if you have credit card debt, change your daily student loan payments to pay off the high-interest debt quicker.
If you do not have an insurance fund, you should move your debt balance to savings instead.
3. Ramp Up Your 401 (k) Contributions
If your retirement fund is strong so you don’t hold a lot of credit card debt, consider offering a lift to your tax funds.
If you were already planning to max out your 401(k) contributions this year, doing it while prices are low means you’ll increase your returns when the market eventually rebounds.
4. Save Your Money on Your Mortgage
When you buy a home, run the math on refinancing. You may be able to reduce your mortgage costs. This will help even fairly new buyers, because mortgage prices are one percentage point smaller than they were only a year earlier.
5. Give Back to Your Community
This one will not improve your financial situation technically but it will make a difference in your community. If after the pandemic you are still financially stable, then help small companies. Donate to the food bank in your city. And do your best to back the hardest hit by this financial crisis.
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