When it comes to finance, it’s often easy to spend and without realizing how much you have spent. Nowadays, with our new normal, monitoring your finances is important. You could say that frugal is the new cool.
However, it’s sometimes difficult to get out of random spending habits that you have grown accustomed to. While it may be challenging, it’s doable. It’s not just doable, it’s a requirement. Now is the time to stop spending or at least “over-spending”.
This is the time to take a hard look at your expenses and reevaluate what is absolutely necessary right now. Items like your monthly subscription to Stitch Fix or BarkBox. On top of that, retail therapy often introduces a different form of long-term stress. This is when eliminating or suspending services is critical if you don’t want to blow money. It’s important to put regularly attended facilities on freeze or simply eliminate them completely. Never maintain any type of membership where a store or location is closed for more than 90 days.
This is also a good time to talk with your insurance agent. There may be alternative things to be done during the time that you are closed while staying within your policy guidelines. Some agencies have what is called “Business Interruption Clauses” included in their policy. It may be valuable to ask your insurance agent if you qualify under COVID-19 guidelines.
Next, don’t forget to contact your creditors. Explain that your salon is closed until further notice and that cash may be tight until you are allowed to reopen again for business. Ask how you can work through this together, deferred payments may be possible. Explain you want to be proactive. Then you must be prepared to speak with your banker.
While we don’t like to do it, sometimes it’s important that you ask your landlord if it is possible to postpone or suspend your rent payments until you are fully up and running. If you can’t get a rent reduction, you may be able to postpone payments to a later date or prorate them over the remainder of the year. Your landlord may be in a tight situation too. Just know that a compromise on rent is a better solution than potentially having to fill an empty space later on.
If you have a mortgage, ask your lender about forbearance. For those of you that are homeowners, “Forbearance” is an option where you and your lender agree to temporarily suspend your monthly mortgage payments for a specific period of time. Request that payments for the next 90 days be added to the end of your loan. Right now, new government bills to help citizens with closed businesses, and those out of work due to COVID-19 continue to be evaluated by Congress. Don’t forget, you can always call your lender and ASK.