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How to Make Smart Money Decisions During the Pandemic

A pandemic has brought upon us unique and challenging times. There are questions surrounding our personal financial futures as well as our nation’s. Many individuals’ and families’ incomes have decreased or been eliminated altogether as businesses shut their doors for a season. Even for those whose incomes have not yet been impacted, they are asking themselves how they should prepare for the worst and plan for financially tight times. Let me offer a few suggestions:

1. Get to know and take advantage of the Cares Act. The United States government has signed a bill that provides $2.2 trillion in stimulus funds. Thirty-percent of the package is directed toward individuals, including rebate checks, an increase in unemployment benefits, temporary loan relief, and additional retirement account flexibility. Take some time and explore what the Cares Act offers. If you find yourself eligible and needing what the Cares Act offers, take advantage of it.

Here’s an article I coauthored to help you understand the CARES Act–The CARES Act: What Individuals Need to Know About the Stimulus Bill.

2. Identify your financial priorities. Now is the time to get your financial priorities in line. More than usual, it is not the time for frivolous spending (step away from the Amazon cart) and risky financial moves. Identifying your financial priorities will help you know what to do with limited funds. To get you started, here is a recommended list of financial priorities:

Priority #1: Giving. I know that giving seems counterintuitive at this point, but the Bible tells us we can trust God with our financial first fruits. Over and over again, the Bible shows us that generosity is our financial priority, even during difficult times. So whatever God gives you, take a portion of it and give it away, making the church your first place of giving.

Priority #2: Food and health. Your next financial priority is health, which includes food. Take care of your health and the health of your family. All of the other items on this list are meaningless if you are unable to sustain your life and the life of your family members. Use the money you have to put food on the table and, when needed, medicine in the body.

Priority #3: House. You and your family need a roof over your head. The good news is that the Cares Act has provisions for mortgage payments and protections for renters. So, if you find yourself in a financially tight place because of the pandemic, you may be able to postpone a few housing payments and focus on the latter financial priorities during that time period.

Priority #4: Utilities. If you have a roof over your head, ensuring the availability of water, electricity, and gas are your next financial priorities. So, be sure to pay your utility bills. If you find yourself struggling to pay the bills, reach out to your utility companies to see what options they can provide you. I would also include your basic phone service at this point as well.

Priority #5: Automobile. Next, you need to ensure that you have transportation to the grocery store, medical facilities, and work (assuming you’re considered an essential employee). Additionally, you will need transportation once current shelter-in-place mandates are lifted and your company needs you to return to work or, if you are currently unemployed, you get a job offer.

Priority #5: Other loans. If you have additional loans, keep making your payments. The only exceptions are loans payments that can be postponed according to the Cares Act. These loans include federal student loans. It is important note to that these provisions are not automatic. You must contact your lender first. Other private lenders may have flexible payment options during this time so be sure to contact them as well.

Priority #6: Everything else. Your Disney+ and Netflix subscription services are your last concern. These are luxuries. Don’t prioritize Mickey Mouse over your water bill.

3. For those who are able, don’t put the 8 Money Milestones on pause. The 8 Money Milestones serve as a guide for your financial decision-making. They help answer the question, “What financial step should I take next?” If you are not familiar with them, here they are:

  • Milestone 1: Start giving

  • Milestone 2: Save $1,500 for a minor emergency.

  • Milestone 3: Max out your 401(k) or 403(b) match.

  • Milestone 4: Pay off all debt except your mortgage.

  • Milestone 5: Save 3-6 months of living expenses for a job-loss level emergency.

  • Milestone 6: Put 15% of your gross income to retirement.

  • Milestone 7: Save for college or pay off your mortgage.

  • Milestone 8: Live generously.

If you are able, continue pursuing the next Milestone. Don’t stop paying off debt, creating an emergency fund, or saving for retirement during the pandemic. These times reveal the importance of having each of these goals reached. So, if you are financially able, keep moving forward and go after that next Milestone.

These are difficult times for many. As believers, we find comfort and hope in knowing that God is still on the throne, ruling over all. While the pandemic has surprised many of us, He was not caught off guard, nor is He fretting over it. He is confidently in control, and we can trust in Him.


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