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Financial tips on how to weather the COVID-19 economic storm

Posted at 7:30 PM, Jun 15, 2020
and last updated 2020-06-15 19:30:22-04

NEW YORK — The coronavirus pandemic and lockdown continue to have a growing impact on the economy with job losses and stock market swings. While some areas are starting to slowly reopen, many businesses are still closed as much of the nation remains on some sort of lockdown.

Financial expert Farnoosh Torabi shared some tips to weather the financial storm. She said one question being asked often is what can people be doing now to prepare for what’s around the corner. Farnoosh said if you still have your job, start stockpiling cash.

“Cash is king, or queen, in any downturn,” said Farnoosh, “You want to have at least a six month ‘rainy day’ reserve because cash gives you options."

If you are one of the more than 40 million Americans who has lost their job, Farnoosh suggested reaching out to your creditors and negotiating.

"Be proactive and initiate those conversations with people like your landlord, your mortgage lender, your credit card company," Farnoosh said. “If it’s your credit card company [ask about] getting rid of interest, getting rid of fees.”

Farnoosh said your creditors are not going to come to you with solutions.

“It’s our responsibility, as we always have to be our biggest financial advocates, now more than ever, to go out there and ask for what we want and what we need," she explained.

When it comes to having those conversations, Farnoosh said the best approach is to just be honest about your situation.

"Don't hide it, don't try to dance around the issue. If you've lost your job , flat out say 'unfortunately I've lost my job' or 'I've been furloughed' or 'I run a business and it's a brick and mortar shop, we've had to shut down and lay off our employees,' start with the truth," she said.

Farnoosh also recommends people ask their lenders what “relief payment plans” the offer to their customers.

"Banks are typically set up during times of crisis, whether that`s the financial recession, a housing crisis today, they are prepared for helping their customers through tough times,” she explained. "It's not in their best interest to... see you declare bankruptcy."

For more financial tips in the time of coronavirus, you can check out her podcast, “So Money with Farnoosh Torabi” by clicking here