Surviving the Financial Effects of COVID-19: Part 2

In Surviving the Financial Effects of COVID-19: Part 1, we focused on debt management and relief during the pandemic. In Part 2, we will discuss a few general strategies for paying your bills, avoiding scams, applying for government benefits, and taking full advantage of the CARES Act.

Assessing Expenses, Adjusting Your Budget, and Paying Bills

Determining which expenses are necessities is often more difficult than it seems. As we adjust to working from home and limiting social interactions, we may find ourselves furnishing our home offices, investing in better technology, and splurging in the entertainment sector. While we may want to limit our expenses as much as possible, we also must take care of our mental health, and this can be a fine line to walk.

Ultimately, we urge you to only take advantage of deferment or forbearance if you have no other choice. Many relief options currently available to consumers and borrowers are temporary, and you will likely be responsible for missed payments after the national emergency. Additionally, when choosing between dipping into savings and charging a credit card, diminishing your savings is always the better option in the long run.

If you cannot afford your bills, take great care when choosing which bills to miss. Get into contact with your creditors and service providers as soon as you know you might not be able to afford your next bill. The more proactive you are, the more inclined your lender will be to provide temporary relief.

Avoiding Scams

Whenever the government releases nationwide funds during a crisis, scammers double their efforts to take advantage of unsuspecting Americans. If a person or entity reaches out claiming you need to provide an application and fee to obtain your stimulus check, do not provide them with any information. The federal stimulus payments are automatic, and the only information you may need to provide is a tax return, depending on whether you are current.

Additionally, anyone (besides your lender) who promises they can provide relief from your mortgage or student loans cannot be trusted. Only provide your sensitive information to your attorney or CPA.

If you believe you have been scammed, consumer protection laws can help you recover lost funds and hold the scammer accountable. Contact law enforcement as soon as you believe this has occurred.

Obtaining Relief Through the CARES Act

Depending on your income and whether you are an individual or business, the CARES Act may provide significant financial relief. The most well-known provision in the CARES Act is the government’s decision to send up to $1,200 to each qualifying American, plus $500 for each dependent child. If you make more than $75,000, the amount you receive will decrease, and you won’t receive any payment if you make more than $99,000.

Fortunately, you can still receive a stimulus check even if you are receiving Social Security benefits for:

  • Supplemental Security Income
  • Retirement
  • Disability

You will not need to apply for your check—it will be sent automatically. You will receive it via direct deposit if the IRS has this information on file. If not, you will receive it in the mail within the next few months.

Another form of relief under the CARES Act is the suspension of federal student loan payments until September 30, 2020. This 6-month deferment also sets qualifying borrowers’ interest rates at 0%. Were you working toward loan rehabilitation or Public Service Loan Forgiveness before the CARES Act? This 6-month period will still count toward your progress. If your loans are privately owned, or your Perkins or FFEL loans are owned by your college or a commercial lender, you will not qualify for this relief.

Workers’ Compensation and COVID-19

To receive workers’ compensation, you must prove that your illness or injury is the result of your work. This can be a challenge during a global pandemic because anyone could easily contract the virus outside of work, and you cannot necessarily prove you contracted it during work hours. You may have a higher chance of success if you work in the healthcare profession or are otherwise regularly exposed to the virus.

Every state will handle these claims differently, and we strongly urge you to get in touch with our firm for a personalized assessment of your potential claim.

Let Lam Law Firm Guide You Through This Crisis

At Lam Law Firm, we have years of experience helping individuals, families, and businesses navigate unexpected challenges. Whether you need to file bankruptcy, apply for Social Security benefits, or file a workers’ compensation claim, we are here to support you every step of the way. We know how overwhelming this crisis may be for you and your loved ones, and we are determined to help restore your sense of confidence in your future.

To get started with your initial consultation, call (843) 695-7700 or contact us online today. We are conducting all consultations over the phone to ensure the safety of our clients.