COVID-19 has effected millions, if not billions of people all over the world. Here in the US, there are now over 6 million people who have been laid off or furloughed in this trying time. For many, this means that they have had to look for outside help in order to make their monthly bills for the first time. This page started as a review of The New York Times article called: “Your Money: A Hub for Help During the Coronavirus Crisis.” However, I found these resources (and more that I’ve added) to be extremely useful, so I wanted to create a place where I could gather them all in a free platform and keep them regularly up to date.
Help for Individuals
There are quite a few sources for individual help right now. So, let’s go through what those are so that if you need them, you can take advantage of them.
You may have heard of the CARES Act over the past few weeks. This was a $2 Trillion stimulus package for the economy. Part of that package includes stimulus checks for individuals making less than $75,000 or married couples making less than $150,000. These checks are up to $1,200 for an individual (single) or $2,400 for a married couple. There is also a phase out salary range between $75,000 and $99,000 for the individual and between $150,000 and $198,000. These amounts are based on your adjusted gross income from your latest filed tax return (either 2018 or 2019).
On top of this, if you have children under the age of 17 that you claim as dependents, you will receive an extra $500 per child. This is regardless of whether you are single or married. Unfortunately, if you have children 17 or older, you will not receive the extra stimulus funds for them, even if you do claim them as a dependent. I’ve summarized this all in the following chart below:
If you want to verify how much you will be expected to receive, especially if you are in the range where the checks will phase out, check out this calculator from the Washington Post.
To be clear, this money is not a loan. This is an advanced tax credit that will have to be claimed on your 2021 tax return, but will not affect the amount that you pay in taxes for 2020. For other questions on how you will receive your check and other aspects of these economic impact payments, take a look at the IRS website.
If you are still in good financial standing during this crisis (secure job and ample savings), I strongly encourage you to donate your stimulus checks that will be coming your way. I’ve noticed several articles on “How best to invest your stimulus money” and the thought of that just turns my stomach when there are so many struggling in this time of crisis.
If you do find yourself unemployed during this crisis, the first thing that I recommend you do is to apply for unemployment and keep trying if it takes a while. With so many claims coming in at once, the system is being overwhelmed, but the benefit is significant. The CARES Act has allowed for an extra $600 per week of assistance over standard levels. This can be the difference between paying your bills and defaulting on them.
Not only would you receive an extra $600 per week, but in most states the length of unemployment has been lengthened from 26 weeks to up to 39 weeks. This will, hopefully, allow for enough time for the world to recover from this pandemic.
Lastly, the eligibility criteria has been expanded to include those who have been furloughed, had their hours reduced and contractors, all who previously did not qualify for benefits. So, if you are any of these situations or having been completely laid off, file for unemployment, no matter how many times it takes.
Paid Sick Leave and Family Leave
The Families First Coronavirus Response Act (FFCRA) has taken the current nonexistent paid leave minimum to provide for some who may need to take time off due to the pandemic. This is by no means a sweeping regulation, but it is an improvement over the nothing that we had going on at this time. However, there are a lot of exceptions, approximately 80% of the workforce:
- Businesses with fewer than 50 employees (although they are eligible for federal loans to try and keep employees on the payroll. See below)
- Companies with 500 or more employees (accounting for approximately 54% of all workers).
The exemptions leave it up to the employers to create their own policies. Some have taken this as an opportunity to do right by their employees. Others, like Waffle House, have not. Once everything returns to the new version of normal, how companies have reacted in this crisis will affect where my money gets spent. I hope it affects yours too.
I’m sure that most companies are rolling out updated policies in this time, but make sure that you have the latest information. If your company falls between the 50 and 500 employee exemptions to the FFCRA rule, know that you are entitled to two weeks of paid leave for your full pay (up to $511/day), as long as you have worked there for a minimum of 30 days . Additionally, you may be able to get 12 weeks of paid leave to care for children whose schools are closed or whose child care is unavailable. The pay limit is two-thirds of your usual pay (up to $200/day).
This act is not a permanent change and expires at the end of 2020. Here’s to hoping that it opens the eyes of many employers to the struggles that their employees, particularly at the lowest levels, face even when there isn’t a pandemic.
The US government has moved the federal tax filing deadline from April 15th to July 15th, giving you an extra 3 months to file. This is especially useful if you think that you will be required to make a payment. If you are owed a refund, I recommend filing your taxes as soon as possible to take advantage of this in a time when you may need the money the most. If you will owe a payment, I suggest waiting until July to file.
Not all states have moved their tax return dates to the same date as the federal government. Here is a list of all of the updated state return dates.
Federal Student Loans
The Education Department is providing relied for holders of federal student loans without any action on the part of the borrower. Borrowers will be put into administrative forbearance between March 13th and September 30th. This means that no payments are due and interest will not accrue during this time. Also, any skipped payments under this administrative forbearance will still count towards your necessary payments for income-driven repayment and public service loan forgiveness, as long as other requirements are fulfilled. It may be a good idea to double check with with your loan servicer though just to make sure you have it in writing somewhere should you ever need it.
If you are able to make your payments during this time, you have the opportunity to pay your loans down faster as your balance will be lower by 6 payments be the time that interest starts to accrue again. HOWEVER, I would only recommend this path if you are not at risk of losing your job during the pandemic and have a sufficient emergency fund in place. If you do not have any emergency fund, I would recommend taking this opportunity to save those payments to build a cash cushion for yourself should you ever need it.
Note that these conditions only apply to Federal student loans. Private loan servicers, Sallie Mae and Navient, are also offering their own relief programs. Check with your private student loan servicers to see if they have provided any relief in this time.
Mortgages and Rent
Another bill that can most likely be delayed are mortgage/ rent payments. The Federal Housing Finance Agency has instructed mortgage servicers to allow borrowers with mortgages owned by Fannie Mae or Freddie Mac to delay payments for up to 12 months. Additionally, evictions and foreclosures have been put on hold for Fannie Mae and Freddie Mac borrowers. You can find out if you qualify for this forbearance program here.
Have a mortgage not held by Fannie Mae or Freddie Mac? You still may be eligible for a payment suspension. Your best bet is to call your loan servicer directly on this front. Some have been offering 3 months of relief, others are offering up to a year.
Do you rent? Well, the mortgage forbearance program may still benefit you if your landlord takes advantage of it. Also, the stimulus bill prohibits landlords from charging late fees and penalties for nonpayment of rent, including eviction. Note: you CAN still be evicted for other reasons. Check here for further, state specific resources, for example New York has suspended all evictions until further notice.
Speaking as a landlord, I’ve reached out to our tenants and told them that if they have any issues with income during this time that we can reach some kind of arrangement for nonpayment or delayed payment. Your best bet is to talk to your landlord as soon as there is any kind of issue.
Many utility providers are also taking action by agreeing not to terminate residential or small business services. A list of companies taking part is available on the Federal Communications Commission site. This can include water and electricity companies. Some in California, Washington and New York have taken this action.
Check with your local utility companies to see if they’re taking part. Most have this posted directly on their website, but you may need to call. Take the time to do so and it will be worth it.
UPDATE: The FCC has extended the “Keep Americans Connected” Pledge until the end of June. This pledge urges internet providers to provide continued service and waive late fees through the end of June. Additionally, if you are looking for a new provider, you can compare internet offers based on your location to see what is available directly to you.
Car and Other Types of Loans
Many types of debt servicers are offering deferred payments or cancelling late payment penalties. Check with your service providers on this front. For example, Ally and Bank of America and many other banks have offered to defer loan payments.
Regardless of the help with the rest of your bills, you may find yourself, many for the first time, in the situation where even putting food on the table is a financial stretch. Find the local food pantries near you. The dedicated employees and volunteers at these organizations are working overtime to try and feed America in this time of great need.
Another place to check is federal food stamps or Supplemental Nutrition Assistance Program (SNAP). You can check if you are eligible for this benefit here. There are bank account limits for this type of benefit, so, if you have any emergency savings, you may not qualify.
Have a vacation that was planned and now you need to cancel due to travel concerns or financial concerns? Most airlines, hotels and travel sites are offering full refunds without charging any service fees. If you find that this isn’t the case for some reason, call them directly and try to discuss with a manager or supervisor. Once you do receive that refund, if you do not need it to pay for any immediate bills, try to save it in an emergency fund in case it is needed later.
If you need further assistance than what is listed here, many credit unions are offering assistance with hardship loans, debt consolidation and more.
For Small Businesses
Part of the recently released stimulus package directly addresses the struggles small businesses are facing at this time. Here are some of the resources from the stimulus package and other resources that may help.
Paycheck Protection Program (PPP)
The PPP consists of forgivable loans for eligible small businesses provided by the US Small Business Administration (SBA). The maximum loan amount is equal up to 2.5 months worth of payroll, with a cap at $10 million. The purpose of these loans is to minimize the number of individuals who are laid off, furloughed or see payroll reductions over the next few months. Here is a list of the qualified banks participating in this program that are currently accepting applications.
The best part of these loans are that they will be completely forgiven IF you are able to maintain payroll for eight weeks at your employees’ normal salary levels and spend the loan on qualified expenses. Only 25% of the received amount can cover non-payroll costs for the entire amount to be forgiven. However, even if you do not qualify for your PPP loan to be forgiven, the fixed interest rate is 1%, which is extremely reasonable.
Now, as for the definition of payroll, the following items can be covered per Forbes’ article on the PPP:
- Salary, wages, commissions and tips capped at $100,000 per year for each employee
- Costs of benefits including vacation, parental, family, medical and sick leave
- Allowance for separation or dismissal of employees
- Payments for health care benefits
- Payments for retirement benefits
- State and local taxes on compensation
- Sole proprietors and independent contractors aren’t eligible to be included in a business’ payroll costs. These individuals can apply for a loan to cover their own wages, commissions, income or net earnings from self-employment, up to $100,000 per year.
In general, if you are in need of assistance to keep your business running and not layoff any of your workforce, I recommend the PPP as your first step. Even though the program is open until June 30th, it is highly recommended that you apply sooner rather than later as some banks have already hit their cap of $10 billion in loan distributions.
UPDATE: With the PPP running out of money, there has been a scramble in Washington to add further stimulus to this program. I would recommend applying with the assumption that this will get a second wave of funding in the coming days. If this comes to fruition, you will want your application to either be sent immediately after or already be there in case there is still not enough funding.
Economic Injury Disaster Loans (EIDL)
The SBA has also expanded access to the Economic Injury Disaster Loans program. These loans can be made of up to $2 million to small businesses and nonprofits. The interest rates on these loans are kept low at 3.75% for small businesses and 2.75% for non-profits for up to a 30 year term. Payments can be deferred for up to 4 years for these loans.
As a final note, applicants do not need to provide a personal guarantee on loans under $200,000, making them even more accessible for smaller businesses.
Emergency Loan Advance
Emergency Loan Advances (being treated as grants) of $10,000 are available to SBA Economic Injury Disaster Loan applicants even if you are denied a loan. This money can be utilized for any business expenses, but if possible, I recommend using the money to help your employees out with some paid sick leave.
SBA Express Bridge Loans
These loans allow small businesses, who currently have a business relationship with an SBA Express lender, to access up to $25,000. The idea is that there is a quick turnaround for these loans and can provide a business with immediate relief while they wait for an EIDJ loan.
Please see this program guide for further information.
SBA Debt Relief
If your business currently has or is issued for a qualifying loan prior to Sept 27, 2020, the SBA will automatically pay the principal, interest and fees on those loans through the end of this year.
SBA Free Business Counselors
If further assistance is needed beyond what is specified above, SBA is offering help to small businesses to find local business counselors for free.
In addition to the individual tax deadline moving, there are also changes on the business side. Federal tax returns have been moved back to July 15th, same as individual returns.
In addition, quarterly estimated payments due April 15th (first quarter) and June 15th (second quarter), have been moved back to July 15th.
State and Local Help
Check your local Governors’ office website to see if there are any state specific programs in place.
Is there a different way to look at your business model to adapt how you’ve done business in the past? Is there an online only component that you have for your business that you could augment? Here are some ideas for various businesses:
- Restaurants, even fine dining, have gone to take out only services.
- Teaching private or group lessons online via an online chat platform
- Offering all outdoors construction or repair projects where there is no face to face (I’m getting my gutters cleaned this way).
- Educating others in simple DIY home repairs either through videos online or through one on one video conferences.
- Scheduling projects to take place in the future and getting deposits for that future work.
- Utilizing your employees to do some, usually much needed, process improvement work.
As I get questions through my contact page and find other resources, I will add to this page to continue to provide the most up to date information possible.