When the coronavirus pandemic first erupted, the U.S. economy took a major hit. With stay-at-home orders in place throughout the country, many businesses were forced to temporarily shut down. That caused a record-high surge in unemployment and immense financial hardship for many people.
Thankfully, the economy is in a much better place these days. The national unemployment rate has been ticking downward all year and is now much closer to where it sat before the pandemic. Companies are grappling with labor shortages, which is not an ideal situation, but is also an indication there are clearly jobs available.
Still, in a recent Personal Capital survey, around 64% of respondents said they’re worried about another economic shutdown. Given that the pandemic isn’t over, that’s understandable. If you have similar concerns, here are a few moves it pays to make.
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1. Build or boost your emergency fund
When millions of jobs were shed overnight at the start of the pandemic, unemployed workers with savings were in a better position to manage than those without money in the bank. If you’re worried the economy will take a turn for the worse, do what you can to sock away enough money to cover three to six months of essential living expenses. That way, if you lose your job and remain out of work for a period of time, you’ll have an emergency fund to tap.
2. Pay down costly debt
The more money you spend on credit card interest, the less you’ll have available to put into savings. Plus, if the economy were to shut down and you were to lose your job, having less debt would ease the strain on your budget while you grapple with lost income.
If you’re carrying a credit card balance, or multiple balances, come up with a plan to pay it down. That could mean consolidating your debt via a balance transfer offer or personal loan. Or, it could simply mean paying off your various balances in order of highest interest …….