So I have been a little unsure as to whether to write anything or not but as this nasty virus is having such a profound effect on everyone’s lives all around the globe and impacting nearly everything we do, I thought it would be prudent to perhaps go through some of the financial issues that we all may have to tackle in the coming weeks and months and try and guide you to the right advice when it comes to coronavirus and your finances.
Please note although I run a personal finance blog this is because I have proved myself to be good at making money and saving money not because I have any financial academic background.
If you need further advice then please head to some of the websites I will list in this post.
The main thing we all need to do is to stay indoors as much as possible and avoid contact with other people, again as much as possible and follow all government guidelines. We will beat this virus but how quickly that takes and how many lives will be lost is determined by how closely we follow these rules.
Financial Impact:
So how is this impacting us financially? Well in the most part it is mainly wages. When it comes to coronavirus and your finances, we are either having to self isolate due to us or a loved one having symptoms or our employer has shut down for a few weeks in line with current government advice.
In some cases, our employer has shut down and not paid any wages or in the case of some small businesses shut down completely.
So where does this leave us? Well in the case of the United Kingdom which is where I reside the government has readied a few financial packages designed to help as many people as possible and I will outline these below.
2 Schemes For Business Support:
The first scheme to support small and medium businesses is the coronavirus business interruption loan scheme. This will provide government-backed loans of up to 5million pounds to help keep these businesses afloat during these testing times. Any interest payments and or fees are covered by the government for up to 12 months.
The second scheme is the Bank of England’s Covid Corporate Financing Facility. This one is a bit more complicated but essentially helps bigger businesses pay wages and suppliers so they can stay afloat and operational.
All this means that if you are fit and well and are serving as a keyworker your job is safe and this is what we all need to hear right now.
Your Wages:
This is the section most of you will be interested in as it directly affects us all. Coronavirus and your finances are important as the impact could be quite bad if you dont act on government advice now.
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Sick Pay:
Ok, so sick pay is rubbish in the UK, A standard Statutory sick pay of £94.25 per week. The government has stepped in and made it available from day one of your self-isolation instead of day four but to be fair this amount nowhere near covers most people’s rent or mortgages so it is a little bit derisory.
If you do need to claim this SSP then you can do an online sickness form on the NHS website
If you are self-employed at the time of writing you are not entitled to anything but this will be changing as the government is devising a package to cover this issue.
80% Wage Cover
A lot of people are thinking that if they are off work due to self-isolating then they get 80% of their wages. As far as I am aware this is only the case when your place of work has to close as most have at the moment due to lockdown and they need to pay staff or risk laying staff off.
For example, my wife’s work has closed in line with the 3-week initial lockdown and is paying staff 80% and then covering the remaining 20% so they all get full pay.
You will essentially become a furloughed worker and should not work for your company for the time period that they are collecting the government grant to pay staff. They can choose to pay the remaining 20 percent but are under no obligation to do so.
At the moment the cap on the 80% of earnings is £2500 per month and the time limit at the moment unless it changes otherwise is 3 months from March.
Benefits:
From 6 April The Government is increasing the standard allowance in Universal Credit and the basic element in Working Tax Credit for 1 year. Both will increase by £20 per week on top of planned annual uprating. This will apply to all new and existing Universal Credit claimants and to existing Working Tax Credit claimants.
You can now claim Universal tax credits without having to attend a jobcentre and can do this from home.
Contactless Payments:
Obviously the need to make and take contactless payments has increased dramatically in the last few weeks due to the coronavirus and the fact people do not want to touch keypads or any such like devices.
The British retail consortium has announced that as of April 1st contactless payment limits will be raised to £45 from £30.
You can already make higher amounts of contactless transactions using your phone but the rollout of the higher card payments within a couple of weeks is good news indeed.
Mortgages:
Coronavirus and your finances is especially worrying If you have a mortgage and are self-isolating or someone in your family is then you can apply to your mortgage lender to get a mortgage payment holiday for up to 3 months to help see you through these tough times.
I would advise doing this online as I have heard that doing it via the phone can take several hours.
Please note that you will still pay interest on your mortgage even if taking a break from payments. Having said that it won’t be payable immediately and will be added onto the total you have left to pay.
Renting A Property:
If you rent your property and are not sure how you are going to pay the rent because you have lost your job or some of your income then speak to your landlord today. This needs to be done ASAP.
The government has stated that you will be protected from eviction although I’m not sure how that works at the moment.
Repayment plans seem to be the way forward if you are falling into arrears with your rent.
Self Employed:
Ok so since I started finishing this article off the Chancellor has announced help for self-employed workers. This help will come in the form of a taxable grant of up to 80% of your average earnings per month, Up to a capped total of £2500 per month.
People will be able to access this scheme no later than June but it would be backdated. The scheme is open to any self-employed people with trading profits of up to £50,000 per year.
Summary:
This global pandemic is giving everyone a hard time and it is scary and the future is a little uncertain but we will prevail and we will all get through this.
I see a lot of good coming out of this at the end such as the planet getting a little healthier with everyone being quarantined indoors and it may even make us all pull together a little more and stop taking life for granted when so many people are dying.
This is just a brief summary of some of the help you can get in the UK. If you are outside of the UK then please visit your local government website for more details on the help you can receive in your own country.
Coronavirus and your finances go hand in hand but hopefully, the steps the government has put in place will help.
The sooner we all stay indoors the sooner this will all end. Stay indoors, wash your hands and follow local government advice.
Coronavirus (COVID-19): what you need to do
Stay at home
- Only go outside for food, health reasons or work (but only if you cannot work from home)
- Stay 2 meters (6ft) away from other people
- Wash your hands as soon as you get home
You can spread the virus even if you don’t have symptoms.
Coronavirus and your finances go hand in hand, I hope you take the advice in the country you live in. Stay at home and stay safe. Good luck to you all.
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