The Coronavirus Pandemic Has Affected Me Financially – What Can I Do?

You probably know many people, yourself and family included, who have been impacted by the financial crisis and community shutdowns.

CASH FLOW SAVINGS:

Remember, Cash is King! You may have heard this. It is true in any situation but especially in a financial crisis.

  1. Watch your Accounts Receivable that your customers owe you. Collect on old debts now before they turn uncollectible.
  2. Consider tightening credit terms or even require cash in advance.
  3. If you are not offering to receive payment from your customers using credit cards, get a merchant services account immediately. It offers nearly immediate payment and customers are more likely to pay via credit card than not pay you at all.
  4. Review your lines of credit for availability. If you do not have a line of credit, get one so that you have the ability to borrow if needed. But also have a plan in place so you don’t drown in debt and never have the ability to repay it. Borrow for the right reasons.

INCOME GENERATION

If your business is losing income, you may need to start thinking totally outside the box to limit the declines in revenue. Take some time away from the distractions of the news and social media, shut everything down and brainstorm. If you belong to industry-related online chat groups, get involved and drum up some ideas. Reach out to your industry associations for thoughts. Here are some to get you going:

  1. Contact your clients and let them know you are there for them. Also ask them how you might be able to serve them during these crazy times. You might get some brilliant ideas from your own customer base.
  2. Offer gift cards for future services or products. Consider discounts for these cards as well, such as “Buy $100 of service for $80”. Contact your lender or credit card provider as they may have gift card programs you can implement. See this article about such a program through Kabbage.
    https://www.cnbc.com/2020/03/18/a-new-way-to-support-a-small-businesses-crushed-by-coronavirus.html
  3. Change how you deliver your product or service. You have seen this in the restaurant industry with the delivery offerings booming. Can you do something similar?
  4. If you are seeing a lot of cancellations and requests to return deposits for services, have a plan in place to encourage your customers to keep the deposit on hand but delay the services.

OTHER IDEAS

  1. Review your insurance policy. Does it have a Business Interruption policy and does it cover pandemics and forced shutdowns? Business Interruption policies are normally used when a business owner has a fire, flood or other disaster that forces the business to shut down for a while. It covers operating expenses of the business, including staff, while the business recovers.
  2. If you operate as a corporate and pay yourself wages and need to shut down, you may be eligible for unemployment. Don’t forget this potential resource.
  3. Watch for government and other disaster assistance programs. Here is the beginning of a list:
    1. SBA Disaster Assistance in Response to the Coronavirus:
      https://www.sba.gov/disaster-assistance/coronavirus-covid-19
    2. Faceboook Small Business Grants Program
      https://www.facebook.com/business/boost/grants?_rdr
  4. Don’t forget, this crisis WILL subside. If you are slow, create plans to take advantage of the opportunities that WILL present themselves when the economy comes back. You may see incredible pent-up demand for services. Do you have an action plan to hire and train staff quickly when it recovers? Do it now when things are slow. Add or improve internal processes and procedures so that when things come back, you are more efficient. Develop post-virus marketing that you can implement when the time is right. Get ready for the recovery, because it WILL come. And it could come back in a moments notice if a miracle cure or vaccine is developed.

INDIVIDUALS

Now is the time for cash preservation.

  1. If you owe taxes, consider a 72-month installment plan, even if you pay it off in 6 months or when things become clearer or the economy recovers. You will pay some penalties and interest but, compared to credit cards or not having cash, it provides you some flexibility you may need.
  2. If you already set up for an automatic payment of your taxes due 4/15, consider cancelling the payment so you can pay by the new 7/15 deadline, or later if you ask for an installment agreement.
    1. Once your return is accepted, information pertaining to your payment, such as account information, payment date, or amount, cannot be changed. If changes are needed, the only option is to cancel the payment and choose another payment method.
      Call IRS e-file Payment Services 24/7 at 1-888-353-4537 to inquire about or cancel your payment, but please wait 7 to 10 days after your return was accepted before calling.
      Cancellation requests must be received no later than 11:59 p.m. ET two business days prior to the scheduled payment date.
  3. Contact lenders – they may offer the ability to skip a payment or two while you get back on your feet.
    1. Credit card companies
    2. Student loans
    3. Mortgage companies
    4. Landlords
    5. Commercial loans
  4. If you get laid off from your job, file for unemployment immediately.
  5. If you must care for a family member due to Coronavirus, new laws are available for paid sick leave and family medical leave that require employers to pay you some or all of your wages for specific periods of time. Be sure to ask your employer about these.
  6. Watch for disaster relief programs. Here are a few we are aware of:
    1. Disaster relief foundation: https://www.usbgfoundation.org/covid-19-response.
    2. Colorado Meals for Children: 
      http://kidsfoodfinder.org/?gclid=Cj0KCQjwjcfzBRCHARIsAO-1_Oq1yPM3YufK_-db96YVzwslGnyYm2F14PkuFkAHHxZQNYVG0sp0JlIaAi1yEALw_wcB
  7. National Hunger Hotline:  Don’t live in Colorado? Call the National Hunger Hotline at 1-866-3-HUNGRY
    1. Xcel Energy suspends service disconnections: 
      https://www.xcelenergy.com/company/media_room/news_releases/xcel_energy_suspends_service_disconnections?utm_source=facebook&utm_medium=social&utm_campaign=3201969841
  8. Don’t forget to help your local small businesses too. They are relying on your during these difficult times. Here is a an article to give you some ideas.
  9. Want to volunteer to help others? Check out this site: https://covrn.com/

We’ll be adding more resources as we become aware of them.Watch our Facebook page  or subscribe to our updates.

1 thought on “The Coronavirus Pandemic Has Affected Me Financially – What Can I Do?

  1. ataköy escort
    April 2, 2020 at 8:37 am

    Thanks very nice blog!

    Reply

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