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With the United States now in a state of emergency as a result of the coronavirus (COVID-19) pandemic, many Americans are operating on high alert. “Not only are people worried about the health of themselves and their families, but they’re also worried about their financial well-being,” says Mikel Van Cleve, USAA advice director. “As professional sporting events and big gatherings are cancelled, it’s especially hard for people who earn hourly wages.”
In the midst of uncertainty, it’s more important than ever to take a measured approach to spending and financial decisions, adds Van Cleve. “We all need to have a plan in place to protect ourselves and our families financially — and USAA is here to help.”
As you navigate the coming weeks, consider these tips to help protect your financial wellness.
1. Start or maintain an emergency fund.
USAA advises its members to have a reserve of three to six months’ worth of living expenses in the case of an emergency. The benefit? When the unexpected happens, you don’t have to go into debt to pay for it.
“With a shortage of things like hand sanitizer, cleaning supplies, and toiletries, we’re seeing third-party sellers marketing things at very high prices,” says Van Cleve. “Out of necessity and to prepare for potential quarantines, Americans are also spending more than usual on groceries and household supplies.”
Emergency funds are meant to cover unexpected expenses like these. If you don’t already have one, it’s not too late. “Take a look at your budget, and see where you can cut expenses,” says Van Cleve. “Then set that money aside in a reserve that’s easily accessible.”
2. Revisit your budget.
To pay for unexpected medical expenses and supplies, take a second look at your budget. “If you don’t have one, USAA offers resources to help you start from scratch, whether you prefer online tools or old-fashioned pencil and paper,” says Van Cleve. “Once you see all your expenses in one place, you’ll have a better idea of areas where you can tighten your belt in order to pay for necessities.”
And speaking of necessities, he cautions about off-brands that may not provide the protections they claim. “Make sure you compare labels for things like hand sanitizers to CDC guidelines, especially before you pay exorbitant prices.”
3. Continue to pay down revolving debt.
Your budget likely includes debt repayment, which is an important piece of your overall financial picture. During times of financial uncertainty, it’s especially important to have credit available when you really need it. “If your credit cards are maxed out, you won’t be prepared for emergencies,” Van Cleve says.
4. Stay in contact with your Command.
As troop movement has come to a halt, many Americans are finding themselves between PCS and other orders. Because protocols vary from one location to the next, stay connected to hear up-to-date protocols and advice.
5. Take advantage of trained professionals standing by to help.
Each base offers a Military and Family Readiness Center with financial counselors available to provide financial guidance — in person, online, and over the phone for U.S. servicemembers. Per Van Cleve, the centers are designed to promote financial readiness and quality of life for servicemembers and their families.
See your Military and Family Readiness center for military financial aid for immediate financial assistance as needed.
This material is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any specific product.
USAA believes the websites and resources used to gather this information are reliable; however, we cannot guarantee the accuracy or timeliness of the information.
USAA means United Services Automobile Association and its insurance, banking, investment and other companies. Credit cards issued by USAA Savings Bank, other bank products by USAA Federal Savings Bank, both Member FDIC.
Use of the term "member" or "membership" refers to membership in USAA Membership Services and does not convey any legal or ownership rights in USAA. Restrictions apply and are subject to change.