Some of you may be experiencing financial difficulty during this pandemic. Here are great ways to overcome them…

Overcoming Financial Difficulty During the Pandemic

As we near the end of 2020, many of us are likely taking a deep sigh of relief at the fact that we made it through the year. Without a doubt, this year has been like no other and for many of us, we were faced with challenges we had never imagined. With the pandemic-induced shutdowns across the country, many Americans lost jobs and businesses, which in turn, created a huge strain on our finances. These events have significantly affected individuals’ financial situation and overall well-being. The economic effects of the pandemic have made it difficult for many, especially those with lower incomes, to pay bills, buy necessities, and maintain utilities. The economic impact has been felt across different income groups, with lower incomes being disproportionately affected by financial challenges, and the broader economy experiencing widespread repercussions. Many households have experienced lost income, forcing them to adopt new coping strategies such as using savings, taking on debt, or seeking government assistance. Not to mention the upcoming holiday season that historically accounts for the majority of our yearly spending.

Although we may have become adjusted to the lifestyle that COVID-19 brought about, you most likely weren’t prepared to battle finances throughout the year and especially now as the holiday season approaches. More than half of Americans have reported that their financial situation has remained unchanged or worsened during the pandemic, highlighting the widespread nature of these challenges. Luckily, there are still some steps you can take with the time left in 2020 to overcome any financial difficulty.

Give Yourself a Break

Before you begin to stress yourself about your financial state, the first thing you should do is breathe. Understand that the simple achievement of surviving this year is something to be proud of. Try not to place unhealthy expectations on any aspect of your life and truly give yourself a break. If need be, explore some ways to relax before you dive into any money issues.

For example, take advantage of some of your favorite activities or try to revamp your self-care routine. While it may take a little creative thinking, both of these can be done without any extra spending on your part.

Instead of investing hundreds of dollars into a spa vacation or overwhelming yourself with a slew of new face masks and serums, you can actually replicate your own spa getaway at home with a few of your pre-existing supplies and decor pieces. In any case, the first thing you should do before tackling the stress of finances is complete a mental wellness check to ensure that you are alright before continuing.

Review Your Finances

An essential step in overcoming financial strain is to review any financial decisions you have made this year.

This can include overspending, financial missteps, or even smart investments that you’d like to build upon in the future. Not only will this review process allow you to see the ways you struggled this year, but it will also help you to develop an effective financing strategy moving forward.

First, you should start by determining your net worth — or in other words, the value of your assets minus your liabilities owed. Your assets typically include any expendable cash you have or property investments like a home, car, or boat. Liabilities, on the other hand, include any outstanding debt owed, like a mortgage, student loans, or credit card debt.

Avoiding Bankruptcy

Once liabilities are subtracted from your assets, the goal is to have positive net worth as this indicates that you still have more money than the amount you owe and you won’t have to explore options like bankruptcy

Next, you should consider your debt-to-income ratio which means exactly what you would think. Essentially, you would begin by compiling a list of all of your debt payments over a period of time and comparing that to your income made over that same period.

Again, you want to aim for a positive ratio as this will indicate how much money you’re actually making over a specific time period. However, if this number is negative, you are losing money consistently which could drive you toward greater financial difficulty in the future.

Some other points to consider include:

• Income
• Spending habits
• How often you take on new debt
• How frequently you pay off debt

Exploring each of these areas of your finances will help you determine how your lifestyle or the pandemic has impacted you and how to make changes moving forward.

Adopt a Plan

Depending on the lifestyle you live as a middle-aged man or woman, you’ll also want to adopt a spending and budgeting plan for the future. Whether or not you’re single or married, or working or retired, there are some general planning tips you can adopt to ensure that they will benefit you down the line.

When creating a budgeting plan, you should start by considering your expenses. While basic budgeting strategies may have typical expenses like rent or mortgage payments, you’ll also want to add any middle-aged-specific expenses that may not be assumed.

For Example

For example, for us, many retirement investments, health care, healthcare, and insurance are all necessities and shouldn’t be sacrificed even amidst financial strain. Instead, cut out as many elements that don’t contribute to your overall health, safety, or protection.

As the holidays approach, account for any holiday spending as early as possible so that you can cut back on spending in other months of the year. Save up where you can try out some quick holiday saving tips. Ideally, you won’t have to sacrifice your gifts even while you are rebuilding your finances.

Debt-Free Financial Plan

Aside from your basic budget, you should also adopt an overarching debt-free financial plan. During COVID-19, many of us had to take on some form of financial assistance to stay afloat this year; however, in your 50s, debt freedom becomes even more important to adopt as it ensures comfortability after retirement. So, this is the time to truly dedicate yourself to a debt-free plan.

A 10-year-plan should suffice; however, you can adjust to whatever you feel is most feasible for you. Some common tactics when taking on this feat include refinancing your home to a lower interest rate or upping your payments for a faster payoff. Additionally, this debt-free plan should include any student loan payments for yourself or your family.

Think Smarter

Arguably one of the most important parts of overcoming financial hardship this year is to think smarter, not harder.

With the entire world still adjusting to the effects of the pandemic, there’s not necessarily a clear strategy that everyone uses to overcome the trouble. So, the key is to build your own strategies with a combination of smart tactics that will help you to save, build your finances, and reach financial freedom in the future.

One of the biggest expenses you own is likely your home and luckily, there are a number of ways you can save on it now to benefit you in the future. For example, in your 50s, you may not be interested in fixing and repairing every damaged and faulty system in our home. And, unbeknownst to many, it’s not always financially wise to do so. In some cases, suitable home warranty plans would bring more peace-of-mind and savings over time than if you were to take on any home repair yourself. This ‘invest now to save in the future’ mindset can be useful for a number of your other assets as well.

Lifestyle Adjustments

Additionally, when it comes to regular spending, many of us may find it difficult to cut back on a lifestyle we have become accustomed to; especially during the holiday season. However, there are ways you can adjust the manner in which you buy to allow you to spend considerably less over time. For example, off-season purchasing can be helpful for everything from clothing to home buying.

For every industry, there is a period of time when the products and services are in high demand and you should aim to shop outside of that, as many companies drop their prices to account for the lesser demand.

Additionally, take advantage of the changing market that COVID-19 has brought on and scope out areas where there is less demand like retail, the real estate market, travel, etc. Throughout the pandemic, many have found remarkable savings by trying new tactics such as these.

Health Risk Behavior

As financial hardship has become more widespread during the pandemic, many people have found themselves turning to unhealthy coping mechanisms. Health risk behavior—including poor diet, less physical activity, and increased substance use—has risen, particularly among those experiencing the greatest financial stress. A large US national sample of women revealed that those facing financial difficulties were more likely to report these behaviors, which can have serious consequences for physical health, such as a higher risk of chronic disease and even mortality.

The pandemic has also deepened existing health disparities, with lower-income individuals and communities being disproportionately affected. Sensitivity analyses conducted by the Centers for Disease Control and Prevention have shown that socioeconomic factors like education and income are statistically significant predictors of health risk behavior during this time. These findings highlight the importance of addressing not just the immediate financial needs of households, but also the broader social determinants of health that influence how people respond to stress and adversity.

Equitable Recovery

Looking ahead, achieving an equitable recovery from the pandemic means more than just returning to the way things were. It requires a thoughtful approach that addresses the financial, social, and health impacts of the crisis—especially for those who have been most affected. Supporting individuals and households facing financial hardship, investing in robust social safety nets, and promoting equitable growth are all essential steps.

Food security is a particularly urgent concern, as food insecurity can have lasting effects on both physical and mental health. Research published in the Annual Review of Public Health has shown that loan terms and debt repayment programs can play a significant role in reducing financial stress and improving health outcomes. By implementing policies that support affordable and sustainable lending, we can help households manage debt and avoid the negative health impacts of financial strain.

Researchers have also found that demographic characteristics such as marital status and socioeconomic status are key factors in determining health outcomes during the pandemic. This underscores the need for targeted interventions and support that take into account the unique challenges faced by different groups. By addressing the root causes of financial hardship and health risk behavior, we can work toward a more equitable recovery—one that reduces health disparities and supports the well-being of all households.

Feel Accomplished

If you’ve made it through 2020 alive and well, you should feel accomplished. Key findings from recent research highlight the significant financial difficulties many individuals faced during the pandemic, emphasizing the importance of effective strategies for recovery.

Unfortunately, financial trouble was just a byproduct of the pandemic for many of us and we are struggling to pick up the pieces. However, simple strategies may be the way to go to truly conquer and build up our finances in the future. Taking a break, reviewing your finances, adopting a plan, and discovering smart spending tactics will not require too much of your time and effort. Prior studies have demonstrated the effectiveness of these approaches in helping individuals regain financial stability. However, they can be the start to complete financial freedom — even after the pandemic. Many individuals have also been supported by government and institutional measures, such as financial aid and policy interventions, during this challenging period. Try these tips and don’t forget to look to a financial advisor or mentor for added assistance, and watch as your financial state changes for the better.

Covid 19 Pandemic

The COVID-19 pandemic has touched every aspect of our lives, reshaping not only how we interact with one another but also how we manage our health and finances. As the virus spread across the globe, it quickly became clear that the impact would extend far beyond public health. Widespread job loss, reduced working hours, and sudden drops in income have created financial hardship for countless households. This financial difficulty has, in turn, led to increased stress, anxiety, and depressive symptoms—mental health outcomes that previous research has shown are closely linked to economic strain.

Older adults have been especially vulnerable during this time. According to a nationally representative survey conducted by the American Geriatrics Society, many older adults have been disproportionately affected by the pandemic, facing not only financial difficulties but also food insecurity and reduced access to essential healthcare. These challenges highlight the interconnectedness of income, health, and access to resources, and underscore the importance of addressing financial hardship as a key public health concern. As we continue to navigate the effects of COVID-19, it’s crucial to recognize how financial stress can impact our mental health and overall well-being, especially for those most at risk.

Economic Impacts of the Pandemic

The economic impacts of the pandemic have been both immediate and far-reaching, touching nearly every household in some way. Unemployment rates soared as businesses closed or scaled back operations, leaving many individuals suddenly without a steady income. For those who qualified, unemployment benefits became a lifeline, but these payments often fell short of covering all expenses, making it difficult for families to pay bills and meet basic needs.

The financial sector has also faced significant challenges. Financial institutions have experienced increased stress, with tighter lending standards and reduced capacity to support small businesses and individuals seeking credit. This has made it even harder for those already affected by job loss or reduced income to access the resources they need to stay afloat. Research published in the Journal of Economic Psychology has shown that financial stress is a statistically significant predictor of health risk behavior, such as reduced physical activity, poor diet, and increased substance use. These economic impacts have not only strained household budgets but have also contributed to a cycle of financial hardship and health risks that can be difficult to break.

I hope this helped you think of your financial future. If you have any questions, please post them in the comments at the bottom of this page.