5 Financial First Steps for Texans Out of Work Due to the Coronavirus Pandemic

The COVID-19 pandemic may have us all at a standstill, but life doesn’t stop because we do. Our families still need to eat, and bills keep coming in even if we've lost all or part of our incomes. If you’re one of the many Texans suddenly out of work because of the crisis, here are five first steps that financial experts suggest to ease the financial burden:

1. File for unemployment: We pay for these benefits through our taxes, so we should use them when we need them. And many of us need them right now. According to the Texas Workforce Commission, the fastest way to file is through its website. Due to the pandemic, the agency has waived the week-long waiting period it usually requires before filing. It’s also waived job-search requirements during the outbreak. People who have lost jobs can also call (800) 939-6631 Monday through Friday from 8 a.m.-6 p.m. to file claims.

2. Cut back on nonessentials: No doubt, you’ve heard it before, but slash all unnecessary spending. It should help that movie theaters, theme parks and other money-sucking diversions are closed. If you’ve been considering cutting cable, stop thinking and do it. Cook at home instead of grabbing takeout or delivery. Like your mom used to say, “Hay comida en la casa."

3. Don’t miss payments: Instead of ignoring bills, call your creditors and let them know your situation. Credit card and loan companies are likely to be understanding given the current crisis. Some may push back payments by up to three months. Of course, interest will still accumulate, but you’ll gain breathing room and avoid a hit to your credit score.

4. Stay healthy: Even if you're desperate for a new source of income, stick to local and federal guidelines about social distancing and sanitation. You need to stay healthy to rebuild your finances. Beyond the risk to your family and community, getting sick can be another staggering setback. Once we've flattened curve, we can get back to our side hustles.

5. As a last resort, borrow against your retirement: While only recommended in dire straits, you can borrow from your retirement account in the form of a hardship loan. That can be helpful if your back is against the wall and you have a 401k from your job. But be warned, it can undo the progress you’ve made toward retirement. Talk to your financial advisor before you take this drastic step and see if there are other alternatives. If you don’t have a financial advisor, now may be a good time to locate one.

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