Thousands of people have lost their jobs in the last few days, and many wonder how they are going to cross this revenue decline is sudden.
You are self-employed and the customers do not come ringing at the door of your business ? It is necessary to quickly put in place a budget to get through the crisis.
In Quebec, 34 % of workers were already living a paycheck to another… Rather than give in to the panic, follow these expert recommendations to help you maintain your finances afloat as long as possible.
Evaluate your income
Once you have assessed the income you receive – for example, 55% of the salary if you were employed and have the right to employment insurance –, redo your budget.
“It is necessary to take account of your new reality and reduce your expenditure accordingly. Prepare your budget for a month, husked week by week to find out what payment goes to what time “, recommends Éric Lebel, partner and licensed trustee in insolvency at Raymond Chabot.
Don’t forget to inquire about the programs are available by different levels of government (allowances, support of emergency, enhancement of the GST, and family allowances, etc) to assess as far as possible the amounts that you will receive.
Several financial institutions have also shown flexibility for the mortgage payments and lines of credit, do not wait to contact yours.
Please note that you can also defer the payment of your taxes, as well as the second payment of municipal taxes in some cities, Montreal in particular.
“If you have the right to a tax refund, hurry up to prepare your return in order to receive a cheque quickly,” recommends Eric Lebel. In addition, this will ensure that the credits and allowances to which you are entitled will be suspended.
Limit yourself to the essential
Times are tough, but take comfort in you saying that some of the costs will decrease : for example, child care costs, but also all consumption expenditure – exit, restaurant, leisure – which absorbed a part of your income. The cost of travel, whether it’s gasoline or public transportation, will also be reduced.
This is also the time to make the right choices at the grocery store. “Food is the item of expenditure where it is most easy and the most common to exceed its budget. The temptations are great to buy products which you don’t really need or that are more expensive, ” points out Éric Lebel.
To avoid blunders, plan meals for the week and stick to this list. And especially, don’t go shopping on an empty stomach ! Cook large quantities to reduce the cost per serving, and remember to check the contents of your freezer. Eat what is there already, in order to reduce the grocery bill.
Savings and debts
That is it for the payment of debts ? “If you have a little leeway in your budget, you could pay off your debts, especially those whose interest rates are higher, such as credit cards. If this is not possible, contact your financial institution to see if it provides options, ” advises Eric Lebel.
For the savings, again, this will depend on your financial capacity. And if you’re tempted to cash in your investments, remember that by doing this, you are going to suffer the losses immediately without being able to take advantage of the rebound in the stock market.
“When it is possible, we don disburses not and instead uses its line of credit,” says Eric Lebel.
Attention : in the course of the next few weeks, it is highly likely that the “sharks” of the credit will try to take advantage of the vulnerability of people in financial difficulty and offer loans fast with enormous interest rates, up to 40 % ! Do not fall into the trap and as much as possible have recourse to traditional credit.
- The budget remains the basis for planning. There are several models on the internet, such as that of the ACEF de Lanaudière : https://www.consommateur.qc.ca/acef-lan/documentation-outils/grilles-budgets-et-chiffriers.
- You will find on the website of Raymond, Chabot, all the details of government programs designed to help individuals during the crisis of the COVID-19 : raymondchabot.com.