Desperate times like these call for desperate measures. If work, health or family disruptions due to the coronavirus pandemic have you struggling to make ends meet, you may need to make some major changes to your finances. But what actions can really make a difference? Consider these, which have worked for others and can save you large amounts of money, either temporarily or permanently.
Start working the phones. Focus first on creditors — your mortgage provider, credit card companies or medical debt holder. “Ask them, do you have the option to be on a payment plan or on a reduced interest rate?” says Rebecca Johnson, manager of the Pittsburgh Financial Empowerment Center. Often, creditors are willing to help you out, but first you have to be willing to call and ask these questions.
Explain your financial situation to your lenders. “Always be up-front about what your hardship is,” says Luke Crumbaker, program manager for the Greenville County, South Carolina, Financial Empowerment Centers. “Especially right now, cite COVID-19 as the cause of the hardship to unlock special options they're developing. Being open about your finances and asking for help will work wonders.” It's much better to make this call before you miss any payments. Some creditors are offering special deals because of coronavirus challenges and waiving interest for the next few months, while others are just tacking it on to the end. Credit counselors are helping people navigate these special programs and triage their debt payments based on each lender's current rules, says Bruce McClary of the National Foundation for Credit Counseling. You can find a credit counselor in your area through NFCC.org or by calling 800-388-2227.
Call utilities and cellphone providers. Your next wave of calls should be to those providing important ongoing services. For example, ask your cellphone provider, cable company, utilities and insurer about extra ways to save (or shop around for a better deal).
It can also help to let them know that you're willing to cancel the service if you don't get a better deal. “If you have an annual contract for cable or internet, you can typically get a newer promo rate even if you're an existing customer,” says Crumbaker.
Talk to your insurance agent. Several auto insurers are giving customers a rebate because they're driving less, and you may qualify for an even bigger discount if you sign up for a data-tracking service, such as Progressive's Snapshot, State Farm's Drive Safe & Save, and Allstate's DriveWise. The company that offered the best rate in the past may no longer have the best deal after your life changes. Let your current insurer know that you're shopping around, says Ana Gonzalez Ribeiro, an accredited financial counselor in the Bronx, New York. “If you're a long-time customer, they'll be more open to helping you out with discounts,” she says.