Has COVID-19 made sudden and sweeping changes to your household’s finances? For better or worse, you’re not alone. Furloughs, lay-offs, and shuttered businesses have become all-too-common during this unexpected pandemic, but unemployment doesn’t have to destroy your financial plans.
The State of Employment in the COVID Era
In April, the unemployment rate hit a steep 14.7%, easily rivaling numbers we’ve seen during the Great Recession and hinting at an economic impact similar to the Great Depression. However, with states and businesses starting to re-open in late spring, our country finally saw some economic positives. The June 2020 Jobs Report revealed positive trends, surprising even the experts as the US added 4.8 million jobs in June, putting unemployment at 11.1% – a rate lower than expected. While it has decreased, unemployment remains higher than at any point during the Great Recession, indicating that a full job market recovery will take time.
Financial Implications, Proposed Relief, and Moving Ahead
The surprising addition of jobs is uplifting news in what was predicted to be a devastating report. Nevertheless, with the CARES Act’s $600 in weekly unemployment benefits coming to an end in late July, the country is looking toward a near-future filled with unemployed Americans who will be in need of relief, reassurance, and a positive future outlook. There are plans in place that hope to support and boost your household income despite the pandemic.
What Happens Next?
Though much remains uncertain, the following are possible opportunities if you find yourself among America’s unemployed:
A Second Stimulus Package – A second stimulus package is poised to give your household a much-needed boost. Senior White House advisor Kevin Hassett acknowledged that a second stimulus package is very likely; however, the specifics of this possible stimulus have yet to be determined.
Pandemic Unemployment Assistance – Unemployment assistance will remain available through 2020. This includes an extension of your coverage, allowing 39 weeks of assistance, as well as an expansion of eligibility, covering part-time workers and independent contractors.
Extension of the Paycheck Protection Program – The PPP can provide your business with government subsidies to cover costs such as payroll and rent. These subsidies are federal loans that can be forgiven if you use at least 60% of the funds for payroll. With $130 billion (out of $660 billion) remaining in the fund, President Trump signed an extension to the program, which means you can apply for assistance until August 8th.
Extension of the CARES Act – If you’ve been claiming unemployment benefits over the last few weeks, you’ve likely received the CARES Act’s $600 weekly benefit in addition to your standard unemployment payments. Though the weekly benefit is set to expire in late July, there is a movement to extend it through January 2021 with a $3 trillion relief package.
Unemployment Benefits for Students – If you or your loved ones are pursuing a degree while working seasonal jobs, you’ll want to know that unemployment benefits are available to enrolled college and high school students whose seasonal jobs fell through due to COVID-19. This special federal program allows students access to assistance for up to 39 weeks, but only for the period when they expected to be employed.
Explore America Tax Credit – Are you eager to travel? The proposed $4,000 Explore America Tax Credit aims to stimulate local economies through travel and tourism and offer significant relief to the businesses and workers within the travel and tourism industry, all of whom have been hit hard by the pandemic. The credit faces opposition, though, as some claim it will take too long to get money into the hands of the people who need it most.
Navigating New Norms
The reality is that both the world and the workforce are changing at a rapid pace, with news and updates happening daily. Though the above forms of assistance are available or could become available soon, the fact remains that details, programs, legislation, and procedures are in flux. But there is power in all this change, even if you are unemployed. It is an opportune time to re-evaluate your finances – refinancing your mortgage, negotiating a better interest rate on your credit cards, or finding debt relief for student loans are all options right now.
Surviving Skills v. Thriving Skills
If you’re facing unemployment because of COVID-19, the road ahead can feel bumpy, uncertain, and overwhelming. With Wickham Financial & Insurance Services, our team of knowledgeable advisors can help you assess your personal goals and create a plan of action. Whether you want to build, preserve, or enjoy your hard-earned wealth, we’re here to help. Don’t get swept away by the uncertainty of the times. With our experts, you can rest assured that professionals are looking out for your interests with each step, keeping a close eye on updates and developments so that you can take advantage of every possible opportunity.
This commentary on this website reflects the personal opinions, viewpoints and analyses of the Wickham Financial Group, Inc. dba Wickham Financial & Insurance Services employees providing such comments, and should not be regarded as a description of advisory services provided by Wickham Financial & Insurance Services or performance returns of any Wickham Financial & Insurance Services Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Wickham Financial & Insurance Services manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
Wickham Financial Group, Inc. provides links for your convenience to websites produced by other providers or industry related material. Accessing websites through links directs you away from our website. Wickham Financial Group, Inc. is not responsible for errors or omissions in the material on third party websites, and does not necessarily approve of or endorse the information provided. Users who gain access to third party websites may be subject to the copyright and other restrictions on use imposed by those providers and assume responsibility and risk from use of those websites.