Smart Money Podcast: Coronavirus Edition
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Smart Money Podcast: Coronavirus Edition
Written by Liz Weston, CFP(r) Senior Writer | Personal finance, credit scores, economics Liz Weston, CFP(r) is a personal finance columnist, co-host on»Smart Money» podcast, co-host of «Smart money» podcast, award-winning journalist and author of five books on money, including the best-selling «Your credit score.» Liz has appeared on many national television and radio programs including the «Today» program «NBC The Nightly News,»» as well as the «Dr. Phil» show and «All Things Considered.» Her columns are distributed in the media by The Associated Press and appear in hundreds of media outlets every week. Prior to joining NerdWallet she was a writer articles for MSN, Reuters, AARP The Magazine and the Los Angeles Times. She shares a home in Los Angeles with a husband along with a daughter and a co-dependent golden retriever.
And Sean Pyles Senior Writer | Personal finance and credit Sean Pyles leads podcasting at NerdWallet as the host and producer of NerdWallet’s «Smart Money» podcast. The show «Smart Money,» Sean talks with Nerds from the NerdWallet Content team to answer the questions of listeners about their personal finances. With a particular focus on sensible and actionable financial advice, Sean provides real-world guidance to help people improve the financial situation of their lives. In addition to answering listeners’ financial questions on «Smart Money,» Sean also interviews guests outside of NerdWallet and also creates special segments on topics like the racial inequality gap and how to begin investing and the history of student loans.
Before Sean took over podcasting at NerdWallet the company, he also wrote about topics that dealt with consumer debt. His writing has been featured on USA Today, The New York Times and other publications. When when he’s not writing about personal finances, Sean can be found working in his garden, going for walks, or taking his dog for long walks. He is based within Ocean Shores, Washington.
Mar 23 March 23, 2020
Written by Kathy Hinson Lead Assigning Editor Personal finances, credit scoring financial management and debt Kathy Hinson leads the core personal finance team at NerdWallet. Prior to joining NerdWallet, she worked for 18 years working at The Oregonian in Portland in capacities such as chief of the copy desk and team leader for design and editing. Previous experience included copy and news editing for several Southern California newspapers, including the Los Angeles Times. She received a bachelor’s degree in mass communication and journalism in Iowa’s University of Iowa.
A majority of the products featured here are from our partners who compensate us. This influences which products we feature and where and how the product is featured on the page. But, it doesn’t affect our assessments. Our opinions are entirely our own. Here’s a list of and .
We’re pleased to welcome you to the NerdWallet’s Smart Money podcast, where we answer your real-world money questions — within 15 minutes or less.
This week’s theme is the coronavirus pandemic , and how you can prepare financially to deal with the fallout.
Know where every dollar gets spent
Discover ways of spending your money on things you enjoy and spend less on things that you don’t.
Our take
The financial consequences associated with the new coronavirus as well as COVID-19 that is causing it are likely to be devastating, with lots of people losing jobs or having their hours cut as the economy slows. It might be too late to create an emergency fund of three months however it is wise to cut back on your spending if possible and reserve money to provide yourself a little cushion.
Having access to credit could be beneficial in times of crisis, as well. If you have a good credit score, you might be able to get a credit card that has a zero-interest teaser rate. People who don’t have good credit may want to take out payday loans, but those can be ruinously expensive. Consider looking elsewhere for . Consider other community resources, like The Jewish Free Loan Association.
If you’re unable to pay your bills, you should prioritize the most important things like shelter, food, utilities and transportation. Contact your lenders to see whether hardship programs are available.
The financial crisis has also been a major influence on the stock market that has experienced extreme swings due to the uncertainty in the economy. If you’re a decade or more from needing the money you have invested — if your retirement is more than 10 years off in the case of a hypothetical example, it’s okay to treat the volatility as background noise. If you’re getting closer to retirement or already in retirement it’s possible that you’ll . This is the perfect time to consult a fee-only, fiduciary financial planner for an additional opinion about whether your retirement plan and investment allocation remain sensible.
It’s not surprising that people’s travel plans have been upended. often doesn’t cover this type of disruption, however .
Our tips
Focus on what you can control, not on what you cannot control. It’s essential to keep yourself informed, but not to consume too much news that is negative. You should consider limiting the time you spend on watching news updates.
Prioritize your bills. If you can’t pay all your bills make sure you pay the essential expenses like food, shelter utility bills, transportation.
Make a long-term investment. The market will slow down and then rebound. If the end goal for your investment is more than 10 years into the future, then you are able to put aside the fluctuations of the day to day.
More about coronavirus on NerdWallet:
Have a money question? Text or call our number at 901-730-6373. We can be reached via email at . To hear the previous episodes, visit the
Episode transcript
Sean Pyles: Welcome on the Smart Money podcast in which we address your questions about money within 15 mins or less. I’m Sean Pyles.
Liz Weston: And I’m Liz Weston. Always be sure to email us your money questions. Contact us by phone or text at (901) 730-6373. That’s (901) 730-NERD. You can also email us at
Sean In this episode, we’re going to tackle a subject that we’ve received lots of inquiries about over the past few weeks: coronavirus and the best way to prepare financially for it. The effects of the novel coronavirus and COVID-19 disease that it causes are already being felt in our economy. Many employees are seeing their hours reduced or being dismissed. The market is experiencing a conniption and people are trying find ways to prepare for the worst. that could mean bolstering your finances , and for some, increasing your stock of toilet paper.
Liz: Sean, you claimed that you thought it was an absurdity, but you realized it’s not.
Sean: I went to the store last night , and all the shelves had been empty.
Liz: Yeah.
Sean Says: I’m happy to have one the Amazon subscriptions where I buy every few months because without it I’d be there, looking for napkins. Who knows? It’s a serious issue. A lot of people are extremely anxious at the moment and a lot of people will be in a very poor financial situation.
Liz In this episode of the NerdWallet Smart Money Podcast, we’ll talk about how to prepare yourself mentally and financially, what to do if you’re unable to pay your bill and why this is an ideal time to learn patience when it comes to investing.
Sean»Sean»: Okay, let’s dive in.
Liz: Let’s start with the mental part because I think this is taking a toll for people in ways they weren’t expecting.
Sean: Yeah.
Liz: So Sean is there something wrong about you?
Sean Says: I am definitely one to get lost in a news cycle whenever something like this happens. It’s only looking at Twitter as well as listening on the radio, and getting really caught up with these instant-to-minute updates and that actually makes me feel nervous. I suppose I do this in order to regain any semblance of control, but I’m just hearing about things that I can’t actually control. I believe that a lot of people are experiencing the same anxiety because this is a serious issue and there’s lots of uncertainty. So one thing that I would like to see happen to think about is to recognize their stress and not obsess over the things they aren’t able to manage. Instead, concentrate on what you are able to manage, such as how often you’re washing your hands , or the type of news that you’re consuming and the cadence of the news you consume.
Liz The idea of putting some limitations on it is really clever. It’s true that you would like to be a well-prepared citizen, you want to know the current situation However, I think there’s a tipping level where we’re just excessive.
Sean: Yeah I really enjoy doing things that help me have some sort of semblance of self-control. This is one of them. I deleted Twitter off my phone and I added an extension to my browser to make it possible for me to view it for five minutes each day. So, whenever I have the urge to look something up it’s a news website and not simply scrolling through the feed of people screaming in the dark. Just find some method to ensure that you’re able to control what you’re watching because it’s really easy to get really annoyed by this sort of information.
Liz: Yeah, absolutely.
Sean I think you’re great mentally, however there are plenty of things you can do financially to prepare yourself for a hardship like this.
Liz Sheryl: I thought about the experience of walking into a grocery shop and finding there are no shelves. Then you realize, oops, it’s a little far too late to get ready right now.
Sean: Mm-hmm.
Liz The answer is that there’s only a certain amount you can do. If, for example, you’ve been living paycheck-to-paycheck pay and then you’ve quit your job I can suggest you have an emergency fund for three months, and you’ll be like, «Well, that was extremely helpful.» Therefore, obviously, when you have a job, if you’re still working, you want to be cautious about spending, you do need to set aside a more cash aside. And we at NerdWallet haven’t been big on putting the emergency fund first since there are a lot of other financial priorities that have to take place which are more important over the long term. However, we would like you to have at least some kind of emergency fund, be it 500, 1,000, whatever to get you out of that paycheck to paycheck trap that it’s really easy to get into. If you have that good thing, then congratulations. If you’re in a position in which this comes a little too late, we’ve got other ideas for you.
Sean: That’s one thing that I was thinking about as well. Many people are living paycheck to paycheck. They don’t have an emergency fund and now is really -particularly in the event that your hours have been cut this is the time you’ll need to draw from the. So one thing that I’m thinking about is I know that a lot of folks are likely to use their credit cards. if you don’t have any savings, I believe now could be the perfect time to consider applying for a zero-interest credit card that would potentially offer a short-term cash buffer. While we generally don’t suggest taking on debt, but if you require a bridge for expenses right now it could be an alternative. Just make sure that you pay all your bills in time to ensure your credit remains stable and have a strategy to pay off the debt before the 0 APR time period expires. Because these cards are all credit cards have a fixed APR, your period is typically between 12 and 15 months , and after that , interest rates could rise as high as 15%, or even higher. Be aware of this.
Liz: There are also alternative options to payday loans. When you search for payday loan alternatives, some of these are likely to pop up and they’re things like charities. I’m sure the Jewish [Free Loan Association] is on the market declaring, «Hey, we’ve got cash for those who need it.» There are short-term grants that are a possibility. Food banks are available. People are trying to help in various ways. Therefore, there are alternatives in place of payday loans. payday loan. Payday loans are a real frightening option.
Sean: Right.
Liz The borrower is a woman. money , and then they end up in a trap where they can’t pay it on time when payday rolls around and end up owing, owing, owing, and not being capable of regaining their feet. So if you’re thinking of one of those loans, look for alternatives.
Sean: Now is the perfect moment to take a look at your community and see the resources available. This is when the majority of these organizations and local community groups are moving into high gear because this is what they’ve been preparing for. They’re there to support you. However, the resources are limited and it can get really difficult when you lose your job, as many people, particularly in the service industry are going through right now. Perhaps in a couple of weeks they’re going to realize, «Hey, I can’t pay my bills at this moment.» Therefore, I’d like to speak about this with you, Liz as this is going to be really hard, it’s likely to affect many people. And Liz, I know that you wrote an article literally that was titled «How to Pay Your Bills when You Aren’t able to Pay Your Bills.» So what do you think is the best advice for this?
Liz The key is to do triage, which means you need to prioritize the most crucial things first. That’s the most important things. It’s food as well as shelter, the roof over your head, lights heating, transportation when you have to go to work or you need to get to the doctor or whatever it is. So those are the essentials that you must ensure you are protected regardless of what. It’s important to remind people because when they do fall in debt the collectors begin calling them and they get scared and pay whoever’s being the nastiest. It is essential to prioritize your family, put yourself first and take care of the most important things. Then, you make a second round of triage for the rest of your charges. Which ones carry the most penalties in case you don’t pay? Which ones have some leeway? Students loans like student loans generally have a deferral or forbearance that allows you to get away with not making payments for a time.
Lenders typically have been a lot more responsive in difficult times, allowing people to switch payment plans, or delay payments or something like that however, you must keep in touch with them. You have to communicate with them. If you stop paying, you may have missed out on some kind of program that could benefit you. You could also have affected your credit score for no legitimate reason.
Sean: Yeah, this is one of those things that you must complete the work prior to the deadline. One thing I’ve been quite pleasantly surprised to discover in the last week is that many of the creditors are creating programs to help make sure they are ahead of the curve and declaring, «Hey, we realize that things are pretty challenging in the present. If you can’t pay your bills contact us.» But you have to make that call.
Liz: Yes, absolutely. We also talk on another podcast about the best way to pay the IRS in the event that you’re unable to pay the IRS. That’s another thing that’s being revealed that people are struggling with. If you have a tax bill that cannot be paid, once again, there are payment options and don’t shy away from them and try to find the options, and they could be a huge assist.
Sean The people they want to work with are looking for their money and they want to be able to work with you and build a good rapport with you. This means that you must be proactive, which is yeah, probably the last thing you want to do when you’re fighting an illness and worry about getting some horrible illness. It takes around 10 minutes. Give them a call and attempt to figure this out because the most important thing you don’t would like to do is fall into default, which will ruin your credit score, which could make it more difficult for you in the future, should you need to get another credit line.
Liz: Exactly.
Sean: A different thing I’m interested in right now is people’s investment portfolios. There’s been plenty of anxiety around retirement accounts. We’ve seen the stock market plunge in the past couple of weeks. I’m wondering what you think people should approach this, and what they should do if they’re thinking about just totally pulling out.
Liz: What’s happening now in the stock market? the reason for it being so volatile is because those who make the trading and the investors are looking ahead and going, «This is going to have an impact on the economy and we don’t know exactly how much.» And the stock market hates uncertainty , which is why it’s bouncing around the globe. If you’re not planning to retire today, then this is basically noise to you. What’s happening from day to day from month to month doesn’t matter. What matters is what happens over the long term, over the coming 10 20 years, 20, 30 years. And we have the ability as human beings and as a society to bounce back. So I think in the long run our prospects are great and I’m planning to remain invested and I’m going to try not to pay much attention to the noise. If you’re planning to retire and you’re looking to retire, that’s a different story. Find an unpaid, fiduciary, accredited financial planner. Have another objective set of eyes on your retirement plan in order to make sure it makes sense.
Sean Sean: Okay, well, that makes sense. This is one of those scenarios where you must be mindful of what you’re consuming so you don’t get into a tense state where you end up investing in things that could harm you 20, 30 years later.
Liz says: What we saw, which was really interesting, is a lot of people dived in the markets. We had lots of traffic coming to the site when the stock market went down the first time, and I think there were a bunch of people who were sitting around thinking, «OK, here’s my opportunity to buy.» Then the floor came out from underneath them and they’re thinking, «Agghhhhh.» But this is just part of being an investor, it happens, and we’ve had bear markets before, we’ve experienced major corrections prior to that. It does bounce back. For those who are in the midst of a slump, it’s like, you’re not likely to catch it before it begins to increase, and when the stock market does rebound in the future, it usually does so so fast, you’re going to miss most profits.
This is why every financial professional that is of a high standard will advise you to stick with the plan, establish an asset allocation plan, make sure your investments are in good shape and try not to look at them.
Sean You can turn off the TV and read an ebook.
Liz: Exactly.
Sean: Put on some popcorn. It’s all right, fantastic. One last thing I wanted to mention is travel plans. There are many people who aren’t planning to travel right now however, they may have plans in place to travel to Machu Picchu or who knows where. The good news is that many airlines are actually making accommodations and waiving cancellation fees, but the rules are changing on a daily basis it seems. So we actually have a link on our show notes post at nerdwallet.com/podcast to an article that is just regularly updated with different airlines’ cancellation policies. If you’ve got travel plans in the near future, check that out and ensure that you’re taking a proactive approach to planning any trips that may be in the near future.
Liz me: I’ve been a bit of stunned since we’ve lived with these horrendous change fees and non-refundable deposits and finger-wagging and to see these travel agencies acknowledge this fact is amazing and kind of like, hey, at least they’re doing it.
Sean The Sean. I think that is all we have time for. If you’re anxious, perhaps being a bit unsure about your finances and unsure about their finances, you’re not the only one, but know that there are some ways to make this difficult period a little more bearable. And with that, let’s begin our guide to take away tips. The first is to focus on what you are able to manage, not on what you cannot control. If you are unable to pay all your bills make sure you pay the necessities: shelter, food, utilities, transportation. Lastly, during big market fluctuations like the ones we’re experiencing right now, focus on the long-term and not worry about the swings that occur day-to-day.
This is all we have to offer in this episode. Do you have a financial question that you’d like to ask? Ask the nerds. send us a text message or call to (901) 730-6373, which is (901) 730-NERD. You can also email us at nerdwallet@gmail.com for more information about this episode. Don’t forget to follow us on iTunes, rate and rate us wherever you’re receiving this podcast.
Liz: And here’s our brief disclaimer that was thoughtfully written by the legal team of NerdWallet. The answers to your questions are provided by skilled and experienced financial writers, however we are not financial or financial advisors. This nerdy info is provided to general education and entertainment purposes and may not apply to your specific circumstances.
Sean: And with that said, until next time, we’ll turn to the Nerds.
About the authors: Liz Weston is a columnist for NerdWallet. She is certified as a financial planner and author of five money books, including «Your credit score.»
Sean Pyles is the executive producer and host of NerdWallet’s Smart Money podcast. His work has been published on The New York Times, USA Today and elsewhere.
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