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Coronavirus: Financial Security in a Pandemic

Coronavirus: Financial Security in a Pandemic
Coronavirus: Financial Security in a Pandemic

Financial security and pandemic. The two don’t really go hand-in-hand, do they? As if facing a global health crisis wasn’t terrifying enough, the world’s economic nosedive is hitting Australian families and individuals hard. Really hard. But as with most things in life, rest assured there will be light at the end of the tunnel. As cheesy as it sounds, we really are all in this together. Out of this strange and unwelcome period will come a brighter future for Australia and the rest of the world. So while we work on our self-isolation best practices, what are the steps we can take to achieve a sense of financial security in a pandemic?

Find out what government support applies to you

The Australian Government is currently providing financial assistance to Australians during this uncertain time. The assistance includes income support, household support and temporary early releases of superannuation. All the important details can be found here.

Be sure to also look at your state government and find out what packages and recovery efforts apply to you.

South Australia: The SA government has unveiled a $1 billion jobs stimulus package. Keep an eye on media releases and updates here.

Tasmania: The Tasmanian Liberal Government has prepared a $420 million stimulus package to support Tasmania. Keep an eye on media releases and updates here.

ACT: The ACT Government has prepared an economic support package of $137 million. Keep an eye on media releases and updates here.

Northern Territory: The Territory Labor Government’s $65 million Jobs Rescue & Recovery Plan has been introduced to keep shops open, cash flowing and Territorians working. Keep an eye on media releases and updates here.

Western Australia: The WA State Government announced a $607 million stimulus package to support WA households, pensioners and small businesses in the wake of COVID-19. Keep an eye on updates here.

Queensland: The Queensland Government has announced a $4 billion COVID-19 package to support Queenslanders’ health, jobs and businesses. Keep an eye on updates here.

Victoria: The Victorian Government has announced a $1.7 billion economic survival and jobs package to support small and medium sized businesses in Victoria. Keep an eye on updates here.

Write up a budget plan

If ever there were a time to start being conservative with your funds, now would be it. You’ll feel an alleviating sense of financial security in a pandemic if you can stick to a well-curated budget. Remember, the ever-changing economic climate brings all kinds of financial stress, so you’ll want to keep updated on what’s happening and budget around that.

Accept the current state of affairs and do what you can to work around it. Try to avoid spending as if everything is normal in the world. Evolve and adapt your spending to suit the current climate. That being said, please don’t panic buy.

Panic buying goes against the idea of budgeting for a pandemic. You might find yourself buying excess of what is necessary, being left with little funds to support other areas in need. Excessive stockpiling can also lead to price gouging, which is when the prices of certain supermarket items double or triple in price. None of us want to pay $20 for toilet roll.

Pay attention to budgetary changes

Now that you are in self-isolation, you will notice certain expenses disappearing and others rising. As you won’t be leaving the house, you will no longer be paying for petrol or for drinks or a night out. You will, however, be using electricity and water at home a lot more. Consider these variables and tailor your spending habits around them. You will need to pay close attention to what money goes where as it will be different to your routine money management system.

Carefully consider a loan

Australian Lending Centre is a leading provider of bad credit loans and consolidation loans Australia-wide. We strive to assist people who have multiple credit cards and personal loans. With the introduction of the coronavirus, we understand finances are tighter than ever. ALC can lend a helping hand. We offer a wide range of financial services and can provide a product to match your individual needs. From debt consolidation and debt management, to credit repair and low doc loans, ALC can help. Get started on your loan application here.

Look after your mental health and well-being

It may be the last on our list, but it is indisputably the most important. A healthy mental state is vital to feeling a sense of financial security in a pandemic. If you feel mentally on top of things, the finances will follow.

Avoid Fake News and Sensationalised Media

One of our top tips would be to avoid fear-inducing media if you find yourself inclined to anxiety. Although we have addressed keeping up to date with the latest pandemic news, this doesn’t mean delving deep into conspiracy theories and reading about all the tragedies. Have an understanding and be aware. Just don’t spend all your time consumed by COVID-19 news.

Stay Busy and Engaged

Try to keep yourself occupied with hobbies. Read a book. Go for a jog. Clean the house or learn a new recipe. Being homebound doesn’t have to mean being bored out of your brain. It certainly doesn’t mean sink into the couch and rotate through Netflix series’ all day.

Seek Support

Finally, seek support if you’re feeling helpless. Beyond Blue has a dedicated page on its forums to help those who are experiencing mental health depreciation due to the current global crisis. You can contact the Australian Government Department of Health on their national helpline (1800 020 080) for information on the pandemic. There will always be people you can speak to and people who can help.

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Emergency Business Loans – Risk vs Reward

Emergency Business Loans||Emergency business loan support||Can an emergency business loan help?||business loan calculator
Emergency Business Loans||Emergency business loan support||Can an emergency business loan help?||business loan calculator

As we find ourselves in the middle of a global health crisis brought on by COVID-19, there comes a point where protecting physical health comes at the expense of our financial health. Employees at risk of carrying the virus are being forced to stay home. Spending habits have completely changed. The stock market has crashed. The list goes on… But what does this mean for your business? Cashflow is likely to be stretched within any company at this time, particularly within business start-ups. If you don’t have much money in the reserves then how can you keep your business afloat if the worst does happen? Emergency Business Loans can provide a fast source of income for when things don’t go to plan. This sounds great, but what are the risks?

What Are Emergency Business Loans?

Emergency business loans can provide a fast source of income to give your business the cash injection it needs during tough times. They are usually granted quickly and you don’t always need a great credit score in order to be approved. But they do often come at a cost, including higher interest rates than a standard loan. Emergency loans come in many forms. These include unsecured personal loans, credit card cash advance loans, payday loans and even pawnshop loans.

Emergency personal loans

The great thing about emergency business loans is that they can be processed extremely fast. You can expect to receive an emergency business loan within days of approval. Depending upon your credit score, you might qualify for an unsecured personal loan. This means that the loan will not be secured against any assets, such as property or a motor vehicle. Personal loans usually have fixed interest rates and can be paid back over a set period of time. Before taking out an emergency personal loan, you should first ensure that you will have the funds available to pay it back, otherwise, you will wind up in a worst financial position than you started in, along with your credit history taking a battering.

Emergency cash advance loans

It is possible to use the remaining balance on a credit card to take out as a short-term loan. This will mean a higher interest rate than normal and this rate will also be relative to how much you take out. So be wary of how much you do borrow via a cash advance loan.

Emergency payday loans

Unless you’re expecting an influx in cash in the very near future but are in a desperate and immediate need for cash to tie you over, for the time being, a payday loan is a risky option. APR’s can be as high as 400% and need repaying in full, rather than in instalments. This should be a last resort option. It’s easy to become trapped in an endless cycle of re-borrowing in order to pay the last payday loan off.

Emergency pawn loan

Another last-ditch option here. You can have personal items valued by a pawnbroker, of which they will use as security in order to back the loan. And if you find yourself unable to repay the loan, your pawned item will be listed for sale.

Are There Alternatives to Emergency Business Loans?

Your personal credit score will not be affected by your business loans. Nonetheless, you still need to submit your personal credit rating. You also need to prove your revenue for a year or two. Banks have tightened their lending criteria in recent times and often require financial history or in-depth account records to assess the capacity of the business to handle their financial obligations. This means that applying for emergency business loans through a bank can be a tedious, time-consuming process. For this reason, if you need funds fast, then banks aren’t a great option.

Emergency business loans may come at a higher cost for borrowers with no proof of income and a poor credit rating. When this happens, it is advisable to search for other options. Here are two alternatives which could help you establish or maintain your business especially when there is an urgent need for funds:

Line of Credit

Do you have a business account with a bank, but don’t qualify for its traditional business loan? You can apply for a line of credit instead. A line of credit enables you to access extra money whenever you need it. This is because they don’t have a fixed term, unlike personal loans. So, you can use it without applying for another loan. You also only pay interest on the amount you have borrowed, not your entire credit limit. However, usually, interest rates are usually variable with lines of credit, meaning that they can fluctuate up or down. You also can’t expect a quick turnaround with a line of credit because it may take weeks before it gets approved. Yet, it can still be a very useful resource for future business emergencies.

Specialised Lenders

Specialised lenders like Australian Lending Centre cater to businesses that do not qualify for traditional emergency business loans. ALC understands that business must continue as usual despite any financial drawbacks.

Considerations Before Taking Out an Emergency Business Loan

If you want your business to keep operating, you need the right funding to pull you out of problematic financial situations. There are also some management decisions that require immediate cash to sustain growth and avoid serious fallbacks.

What are the things to keep in mind when applying for emergency business loans?

Determine the business’s needs and the amount you need to meet it

It is important to have a clear idea of what you really need before you sign the loan application form. It is very easy to lose track of what you intended to do from the start if you don’t have a clear understanding of your needs. Remember that the amount must not be greatly higher than your actual needs. When running a business, it’s important to remember that the costs must be lower than the profit. Otherwise, you will end up spending more than what you actually earned and your business will suffer.

Review your credit history

Have you missed or been late on some of your previous debt repayments? If so, why did it happen? Before you apply for an additional loan, make sure that you have a good budget in place to avoid repeating the same mistake.

Specialised lenders may offer bad credit business loans, meaning they can still approve your loan application despite negative credit history. But reviewing your credit file is good to practise. You may find that there are defaults or judgements which have been incorrectly listed. So, before you send your business loan application, make sure that your credit file is accurate and up to date. Companies such as Clean Credit are able to quickly and easily assess your credit file and repair it if required.

Study your financing options

Specialised lenders may offer better terms than traditional banks, especially if you don’t have a stellar credit rating. Review the company and its loan products, and compare them with other financing institutes. Check if the financing procedures are safe and secure and if you will be able to save more money in the process. It is also important to talk with the loan officer and ask about the details of the loan, including its comprehensive terms and conditions.

Always consider your business plan when applying for a loan – make sure that the amount you borrow and the financing agreement will support your plans. Use every cent you get to support your goals and to build a solid credit history so that you can quickly access business loans with better rates in the near future.

Emergency business loans from specialised lenders are usually approved between 24 hours and 7 days – so it is advised to create a budget before you send in your loan application. Not only will it ensure that you will use the money exactly as you planned, but it will also keep you from defaulting on your loan repayments.

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Financial Planning

Tips to Manage Financial Challenges

family facing financial struggles

If you are in a difficult situation facing financial challenges, learning how to properly use loans, for bad credit applicants, can help.

Do you have a steady source of income which covers not only your needs but also your wants as well? If you’re one of the thousands of Australians who want secure finances but are also dealing with financial issues, you may be wondering how you can achieve that reality.

What Are Your Financial Challenges?

Like many individuals in serious debt, you are probably worried about trying to pay for your daily living expenses and outstanding debts, while wishing to buy a home, a car and probably take a vacation. If so, don’t ever think that you’re alone in this aspect. There are also many struggling parents who need to save for your children’s education while paying off debts and adults with elderly parents to support. And, things get worse when you are going through a divorce, dealing with a death in your family or probably looking for a substitute job for the one you recently lost.

The truth is that there are many events in life that test not only our ability to cope financially but to think positively and overcome these trials with a smile.

Use your financing options to manage these financial challenges

Learn how to take control of your finances, boost your borrowing power and secure a better financial life with the following tips:

Write down each of your goals

Are you really determined to pay off all your high-interest loans? Or do you just need to have a better credit rating so you can borrow even more? Sometimes, we don’t actually know what we want. We just keep on looking for solutions to our immediate problems without looking into their root cause.

For example, if you have $5,000 worth of debts, both in consumer credits and loans, do you trace back to the causes of those purchases? Or, do you simply skip the reflection aspect and look for better financing that could lower your interests so you can have more money to spend on your needs and wants?

While there is nothing wrong in looking for better deals, such as low-interest and easy to pay bad credit loans. Finding the root of the problem in your finances can help you make better decisions with regard to budgeting and balancing your sources of revenue.

Swap the present wants for future needs

Are you spending a few hundred dollars on things you can live without—such as a gym membership, magazine subscription and a trip to your favourite coffee shop? If so, think of how you could use the money to build wealth, like starting a retirement plan to secure your finances in later years.

The sooner you start saving for retirement, the more financially secure you can be when you finally stop working. These contributions are typically tax-deductible, so aside from getting a tax credit for starting a retirement plan, you can also grow your money faster because savings grow faster in a retirement plan as a result of tax-free compounding.  In the end, even small contributions can make a significant difference over time.

Diversify your investments

Do you know how to protect yourself against ignorance? Warren Buffet says that it is through ‘diversification’. Since you’re not really sure if an investment will appreciate over time, you should diversify your portfolio to ensure that your exposure to any individual asset is limited.

What are the asset classes that you currently hold?

Are you involved in alternative investments like real estate, or are you simply invested in stocks or bonds?

Instead of chasing performance for a single investment class why don’t you add a good mix of real estate, cash, bonds and stocks in your egg basket? This way, you can protect your financial portfolio from wreaking havoc when the market declines. If you put more than 15% of your money into a company’s stock, you may be heading for disaster. While you may not be thinking of the worst-case scenario, preparing for these things can help you when you lose your job and your other sources of income. Losing your investments as well, all at once is not an easy crash to bounce from.

Grow your wealth

One of the most important benefits of bad credit loans is that you can use it for wealth maximisation. Create a long-term investment strategy that requires adjustment in your personal budgeting and your appetite for risk. This helps to ensure that no major market glitch will pull your finances down. You never know what will happen tomorrow, but one thing is for sure… life goes on and with the right mindset and professional help, you can enjoy a comfortable and financially stable lifestyle.

Contact the Australian Lending Centre today and receive financial advice from our specialist loans team.