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ICFE eNEWS #20-03 - March 2019

Things To Do If You Miss A Paycheck By Dave Ramsey

Presented by Jim Garnett, a/k/a Ask Mr.G, a member of the ICFE's Board of Educational Advisors

I just received a very helpful communiquť from the Dave Ramsey people that I want to pass on to you. I want to give him full credit for its content. You can find this article and many other really practical financial helps at www.DaveRamsey.com. Hereís his good advice.

ďCoronavirusóaka COVID-19. It has flooded our social media, nightly news, and has even made its way into some of our communities. It goes without saying that this thing has created mass hysteria and panic across the globe. But if youíre looking for that hereóyou wonít find it.

We havenít lost our hope, and you shouldnít either. Weíre going to get through this, folks. Emotions are running high surrounding the coronavirus, and it feels like thereís so much uncertainty. But you donít need to live in fear.Ē

Yes, this virus has impacted all of us, whether itís by coming down with the sickness itself, becoming filled with anxiety from the news, or being out of work (and out of a paycheck). Weíre all feeling it in some way. And with 78% of Americans living paycheck to paycheck, itís easy to see why the loss of even just one paycheck could be devastating.

Will You Miss a Paycheck Due to the Coronavirus?
Itís no secret that things are shutting down all across the world. And if your workplace has closed its doors and isnít offering pay, then itís time for you to (calmly) regroup and get some things in order. The thought of being without a paycheck can be overwhelming. But we donít want to scare you. We want to give you sensible, level-headed actions to take. But first, step back and take a big, deep breath. Did you do it? Okay, good.

Now letís look at some things you can do to keep you on your feetóeven without a paycheck.

Things to Do If You Miss a Paycheck

1. Get on a budget.
If you arenít already living on a budget, the time is now! Making a monthly budget will show you exactly where your money is goingóno ifs, ands or buts about it.

Without a budget, you really canít make every dollar stretch because you might not even know how much money you have to work with. Plus, your budget will show you places where you can cut back and save money (more on that later). And you donít have to rely on a yellow lined notebook to crunch the numbers.

If you donít have any income right now, then make a budget based on the amount of money you do have. If you have $600 left to your name, budget out exactly where each of those dollars will go. Itís time to squeeze every last penny out of what youíve got.

If you still have cash coming in from your spouseís job or some other source, then adjust your budget to reflect that. Maybe the two of you usually bring in a combined $5,000 a month. But with the loss of one income, youíre down to $2,500 a month.

2. Take care of the "Four Walls."
When the going gets roughólike it is right nowóyou need to focus on the things you really need to survive. We call these the Four Walls. Forget the student loan payment, the vet bill and the cell phone bill (for now). The Four Walls are your priority, so pay for these things in this order before anything else:


These are the basics you need to keep going so you can live to fight another day. And itís really hard to fight when your family doesnít have food, isnít it? So if thereís no food in the fridge, donít pay the cable bill.

If thereís any money left over after you take care of the Four Walls, make a list of what else you need to pay and tackle that in order of importance. When you run out of moneyóthatís it.

Someone on the list isnít getting paid, and thatís just how it goes. But it sure as heck isnít going to be the checkout lady at the grocery store. Remember, thatís priority number one!

If youíre renting and having trouble coming up with cash right now, donít stress out. Reach out to your landlord and be honest with them about whatís going on. They might be able to work something out with you for the time being, but they canít help if they donít know. Be up front with them and pray for the best.

3. Pause your debt snowball. (Dave's Ramsey's system for paying off debt)
When youíre just trying to make it to another day, you donít need to pay extra on your debt. Instead, focus on piling up cash as high as you can. This will help with peace of mind until you have income again. Once life gets back to normal and everything is okay, you can pick up where you left off with your debt snowball.

If youíve been chipping away at your debt, you probably donít want to see all your progress come to a screeching halt. But the reality is, if youíre not getting paid, then youíre in the middle of a crisis. So pause your debt snowball. If itís within your budget to keep paying the minimum payments on your debt, go for it. But remember, the Four Walls come first. Donít let your family go hungry for the sake of your FICO score.

4. Sell stuff.
Get radical. No, we donít want you to go selling hand sanitizer on eBay for $50 a bottle. But this is the time to sell what you can to bring in extra cash. Maybe thatís your jewelry, clothes, baby items or even the extra car sitting in your garage. If you know you can part with something and get extra cash in your handsódo it! Well, within reason.

5. Get a temporary job or start a side hustle.
If youíre out of a paycheck because of the coronavirus (or your business is taking a serious hit from it), thatís a real thing. But you donít need to freak about itójust go get some part-time work.
With so much being shut down right now, there might not be as many traditional ways to make extra money out there. Your local hotels, movie theaters and restaurants probably arenít looking for help So think about who might be hiring more right now. Look into driving for Amazon (hello, doorstep toilet paper deliveries), picking up takeout food for Postmates, or dropping off grocery orders with Shipt.

And even if one of those doesnít work out, you can still take up odd jobs around your neighborhood (think cutting the grass, picking up leaves, babysitting, or dog walking). Be on the lookout for opportunities that will add a few extra bucks to your pocket. In this situation, every little bit helps.

6. Look for things to cut.
This is the time to cut back on any unnecessary expenses that you can. Tighten it up. Stop or pause your subscriptions (think Netflix, Hulu, meal delivery kits, specialty makeup boxes). They arenít going anywhere, and you can easily pick them back up once everything blows over and you have extra cash to spend again.

Donít forget to call your cable, Internet and cellular providers to see if thereís anything theyíll do to work with you during this time. Be open and honest, and let them know your situation. Youíll never know if you donít ask! And since you already have them on the line, go ahead and downgrade or pause your service for now. None of these things fall into the Four Walls, remember?

And have you heard of this thing called ďsocial distancing?Ē It means people are encouraged (and want) to stay away from each other right now. Which can make it easier to not spend money. Sports venues are closed, Disneyland is closedóheck, even bars are closed. And even if places are open, this is a time when most people are staying home anyway. Your friends probably wonít pressure you to go hit the town this weekend. Thatís good news for your budget.

We know making sacrifices like this can feel like adding insult to injury when youíre already hurting. But keep reminding yourself: This is not forever. Weíre going to make it through this! Youíre making temporary sacrifices to tread water until this storm passes and youíre back on your feet again.

7. Connect with your church or local community groups.
Letís be clear here: Try to do everything in your power first before you seek help like this. Make sure you cut back where you can and take any temporary jobs to work hard and get back up on your own two feet.

But, in times of real need, donít be too prideful to ask for a helping hand. Many churches and community groups in your area exist for situations like this. They want to help you! If going to a food bank means your family is fed, then do it.Ē

Thank you Dave! Good advice as aways!

The Debt Doctor - Mr. G
Jim Garnett, The Debt Doctor
Henderson NV 89015

Get questions like this one answered in my new book, The Nuts and Bolts of Cash and Credit: An Encyclopedia of Financial Knowledge" on Amazon.com.
Ask Mr. G
© Jim Garnett, The Debt Doctor
AskMrG Consulting, LLC
2216 SW 35th Street
Ankeny, IA 50023

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Sent by:

Paul S. Richard
President - Executive Director
Institute of Consumer Financial Education (ICFE)

About the ICFE:

The Institute of Consumer Financial Education (ICFE) was founded in 1982 by the late Loren Dunton (creator of the Certified Financial Planner (CFP) designation and founder of the College for Financial Planning in Denver, CO.) The ICFE is dedicated to helping consumers of all ages to improve their spending practices, increase savings and use credit more wisely.

The ICFE is an award winning, nonprofit, consumer education organization that has helped millions of people through its financial continuing education courses programs and resources. In addition to eight Certification courses covering identity theft, credit files, credit repair and credit scoring, among others, it also publishes the Do-It-Yourself Credit File correction Guide, which is updated annually. The ICFE has distributed over one million Credit/Debit Card Warning Labels and Credit/Debit Card Sleeves world wide.

The ICFE is a partner with the national Jump$tart Coalition for Financial Literacy and the California Jump$tart chapter. The ICFE staff is also active with San Diego Saves and Military Saves, both offshoots of America Saves.

The ICFE is also an on-line help for consumers who spend too much. ICFE's spending help was featured in PARADE Magazine in the Intelligence Report section. The money helps and tips are from the ICFE's Money Instruction Book, our course in personal finance.

The ICFE helps consumers and students with mending spending, learning about the proper use of credit, budget and expense guidelines, how to set up and implement a spending-plan and also how to access financial education courses and how to teach children about money. Other ICFE services include: Ask Mr. G library, a free eNews service, and an online resource center for students, parents and educators, plus financial education learning tools in the ICFE Book Store.

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