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Money Matters: Your financial game plan for coping with a loss of income

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Dealing with a sudden loss of income is frightening. Careful budgeting and applying for financial help can help weather the storm.

COVID-19 shutdowns have swept the nation, causing unemployment to rise to record heights. If you experience a sudden loss of income, the initial panic can feel paralyzing. Luckily, there are some solutions that can help you stay on your feet.

Self-reflection

First, apply for unemployment benefits if you qualify. States are receiving an unprecedented number of new claims, and they are struggling to keep up with increased demand. Apply immediately and be prepared to wait while your claim is processed along with many others. The payout you are eligible to receive may not fully cover your lost wages, but making up for any portion of your lost salary can help you stay afloat.

Next, categorize your bills. For example, housing, healthcare, and transportation might be your top priorities. Use this priority scale to allocate money toward the most important things in your life.

Analyze your debt and contact your creditors if you need help. This might seem intimidating, but many major credit card issuers, banks, and credit unions have options to help their clients with reduced payments, skipped payments, and lowered balances. You only benefit from these safety nets if you ask.

Don't wait until you can't pay your monthly bills to take action. If you have a big credit card balance, don't be afraid to call your credit card provider to ask if they can lower your interest rate or to see if you can transfer that debt to a low-rate credit card. Just try to avoid incurring any new debts.

Unemployment fraud

Criminals have increasingly tried to capitalize on the rising unemployment rate in Washington state. These scammers attempt to use your personal information to file a false unemployment claim on your behalf. This can sometimes happen without your knowledge.

If you suspect unemployment fraud or just want to make sure your information is safe, you can visit the Washington State Employment Security Department website and create a Secure Access Washington account. This allows you to view past unemployment claims made using your social security number. It also ensures your social security number is tied to the username and password you've created and cannot be used by anyone else. You can also report unemployment fraud on this website.

If you are a victim of unemployment fraud, you should contact one of the three major credit bureaus and have a fraud alert placed on your credit report. That credit bureau will notify the other two on your behalf. These alerts tell creditors to contact you before any new accounts are opened, or existing ones are changed.

To prevent fraud, use strong passwords with at least 16 digits that are a combination of letters, numbers, and special characters. Don't reuse a password from another account, and don't divulge personal information to strangers.

Spotting and avoiding scams

Spotting scams isn't as easy as you might think. Scammers like to pose as trustworthy people and organizations, such as government officials, charities, and financial institutions.

Recently, fake Internal Revenue Service (IRS) phone calls have been discovered that have cost some Americans thousands of dollars. Because fraud against taxpayers is so common, the IRS provides scam alerts on its website to keep consumers informed.

Scammers might contact you by phone, text, or email. Their messages can look legitimate, but they're often riddled with spelling and grammar mistakes. If someone asks for personal or financial information, that's the biggest sign of a potential scammer.

Scammers also like to create a false sense of urgency. They might send you a fake receipt from a purchase you never made, an expensive bill, a message saying one of your accounts is suspended, or a recorded message that means you're facing a fine or an arrest.

Phishing emails are another common scam that may feature logos or signatures that resemble official agencies and companies. Here are some examples:

  • Emails offering free goods or services
  • Emails containing fake receipts or invoices that you know you didn't pay
  • Emails claiming suspicious activity on private accounts
  • Emails asking you to verify your personal information or click unusual links


Don't fall for any of these scare tactics meant to trick you into giving away your personal or financial information. If you receive a message that seems suspicious, you can contact the person or organization directly and ask if they need anything. Best practices include deleting unrecognized messages, not responding, blocking unknown numbers, and hovering your cursor over any hyperlinks to verify if the link is legitimate.

Saving money

In the current recession, everyone's looking for ways to tighten budgets. Start by cutting membership expenses or subscription services you're not using. These fees add up over time, and you might even have forgotten about the ones with auto-pay features.

If you pay for auto or home insurance, shop around for lower premiums. Many people haven't compared rates in years. You can also compare rates on things like internet service, cable plans, or cell phone service. Ideally, everyone should take the time to shop around periodically to make sure they're getting the best deal.

It's also a great time to refinance your home or auto loan if you qualify for a better rate. Contact your financial institutions or research lenders to determine if you can refinance existing loans at a lower interest rate and save money on the overall life of your loan.

As you deal with your financial challenges, remember that you're not alone. WSECU is the credit union for Washington. If you need help with personal banking, loans, or business finances, you can contact WSECU here.

Tune in to STAR 101.5 weekday afternoons at 5:50 p.m. or go to star1015.com/podcasts to hear money tips and ideas to make your dollars go further, featuring WSECU's Briana Mickelson.

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