How to Manage your Credit Cards During the Coronavirus Outbreak - News-Credit-Mortgage-Coin

Breaking

Car donation, Insurance, Credit, Money, news

Coin Market

Thursday, March 19, 2020

How to Manage your Credit Cards During the Coronavirus Outbreak

If you notice a drop in income, a credit transfer card may surprise you until your cash flow returns to normal

Many jobs have been closed during the Corona virus outbreak, and many employees are wondering how to afford their next rent, mortgage, or credit card payment. Here you can find out how you can remedy this with credit cards and other means.



When the outbreak of the novel corona virus - the virus that causes COVID-19 - became a global problem for the first time, many Americans asked questions about travel insurance and the refund of money from canceled or rescheduled trips.

Another important topic was refunds for canceled and postponed events (sports, music festivals, etc.).

But in the past few days, the biggest financial worry has shifted to income, emergency savings, and the ability to keep up with the bills.

Across the country, social distance programs have closed restaurants, bars, gyms, cinemas, and other places where people like to gather. Many employees wonder how they can afford their next rent, mortgage, or credit card payment.

For many Americans, their main source of income has been questioned for some time. They are afraid because they do not know how long it will take and how they can make ends meet before they can work again.


Banks are strengthening themselves to remedy the outbreak of the coronavirus

Good news: Some credit card companies allow customers to skip their next one or two monthly payments without paying interest. These include Apple Card, American Express and Capital One. The key here is that there is no interest - many other issuers offer temporary relief such as reduced minimum payments and forbearance, but interest continues to accumulate, which can be expensive.
Conclusion: If you have problems, contact your card issuer and ask for help. And consider doing this via online chat or social media, as many customers report long waits while on the phone.

Governments also offer relief

The federal government is making proposals such as temporarily abolishing the income tax and sending checks of $ 1,000 to each American adult to help households and the economy during this pandemic.

Unemployment benefit that is processed at the state level is also available to workers who have lost their jobs. The state of New York waives the standard waiting period of seven days before using the services.

Sign up for a 0% credit transfer card

I am always a big fan of 0% credit transfer cards because you can use it to avoid interest for up to 21 months. And since many cardholders pay rates in the 17-25% range, the savings can be substantial (hundreds or even thousands of dollars depending on how much you owe).

Credit transfer cards are probably even more advantageous nowadays, since the offers could soon become less generous (if card issuers compensate for loss of revenue elsewhere by shortening the conditions and increasing transfer fees). Even before COVID-19, we saw an increasing number of cards for which 5% transfer fees were charged (compared to 3% to 4% before).

The certainty of setting an interest rate of 0% for up to 21 months is another important advantage. Many cards with which you can transfer existing credit at a special price of 0% offer a price of 0% for new purchases for at least 12 months.

One limitation is that you still have to make monthly minimum payments for 0% credit transfer and 0% intro APR cards (usually 1% -2% of the credit). Ideally, of course, you would divide the full amount before the clock runs out (and that will eventually require much higher payments). Another way to think about these cards is to get you through temporary cash flow problems.

If cash flow is very scarce, consider getting a personal loan

It may be difficult for some people to make minimum payments or to pay the prepayment fee. In this situation, I am considering a personal loan. This can be a form of debt consolidation and a way to get your hands on much-needed cash as soon as possible (often within 24 hours).

Your rate will not be 0%, but with a good credit rating it can be as low as the middle single-digit numbers. The typical payback period is two to five years, and monthly payments can be very affordable (look for a lender that doesn't impose a prepayment penalty, because once you get into a better financial situation, hopefully you can pay it off early).

Personal loans are usually unsecured, such as B. Credit cards. While you are expected to repay the lender, do not queue your home or car directly, as you would with a home loan or car loan.

Save cash and benefit from refunds

While I'm never a fan of credit card debt if you can avoid it, desperate times require desperate action and everyone needs an immediate supply of cash. Unfortunately, many Americans have experienced this crisis with minimal emergency savings. You have to make sure that your money is not used up too quickly. (As mentioned above, one way to save money and save interest is to open a bank transfer card with a 0% balance.)

Another way to save money is to delay paying income tax for 2019 (if you owe Uncle Sam something) after the federal government extends the deadline to July 15. However, if you expect a tax refund, you should submit it ASAP (if you haven't already) to get the money back earlier.

Card offers for you

Share 0% interest with these credit card offers

Share 0% interest with these credit card offers

Earn cash back, points or miles with our preferred award credit cards

Earn cash back, points or miles with our preferred award credit cards

Our experts have selected the best credit cards of 2020

Our experts have selected the best credit cards of 2020

MyFinance recommendations

Use other reimbursements to pocket money (such as money received from canceled trips, gym membership, or event tickets).

Consider cash back cards

While travel will surely resume at some point - hopefully sooner rather than later - cashback rewards could help in the short term if you are having trouble now. You should also make sure that your current spending habits match the correct cards.

This could be a good time to sign up for a food-focused card like American Express's Blue Cash Preferred® card or Chase Freedom. These and many other cards offer new card holders incentives for registration bonuses.
See related: Best Flat Rate Cashback Cards
This emergency will end - we just don't know when

The US economy was on a very solid foundation before the Corona virus broke out, and we should see a rapid recovery after it has ended (thanks to pent-up demand and more).
At the moment this is a health crisis, not a financial crisis. Hopefully you and your loved ones stay healthy and can benefit from these tips to manage your finances in this scary time.


No comments:

Post a Comment