8 Financial Tips For Young People Amid COVID-19

What to do if you’re stressed about the pandemic’s economic impact.

By Jackie Menjivar

The novel coronavirus, or COVID-19, is truly turning the world on its head. These are uncertain times -- in lots and lots of ways.

It’s likely that the coronavirus pandemic will be one of the most formative experiences in young people’s lives -- especially for those who are entering or about to enter the workforce. We’ve watched entire industries shut down and millions of jobs slashed seemingly overnight to try to stop the spread, and we’re learning that besides the obvious health risks of a global pandemic, we also have to watch out for the economic consequences that follow.

We’re not going to downplay how scary that can feel...because it is scary. If you’re stressed and trying to figure out what exactly all of this means for you and your financial future, this is a place to start.

1. Understand how you may be impacted.

It seems like the headlines have a lot to say about stock market plunges, but that doesn’t always mean a whole lot to a young person with no stake in the game. Here’s what you need to know:

As of April 2, 2020, unemployment claims in the US have just reached about 10 million, and young service workers are taking an especially hard hit.
Gen-Z workers are getting laid off at rates nearly 3 times higher that of their older counterparts.
China may be an indicator of how the virus can take a toll on the job market, with job openings for college grads plummeting 44% at the beginning of their outbreak.
According to experts, it’s likely that the pandemic will lead to a global recession, meaning that we’ll see a significant decline in economic activity over a long period of time (though exactly how long is still TBD).
A recession today would also mean a decrease in job openings and rise in automation, which is already increasingly being applied to not just lower-skilled work, but middle- and higher-skilled work as well.

2. Get advice from folks who’ve been there.

Coming of age in the midst of an economic crisis is difficult -- just ask a Millennial about what it was like for them during the Great Recession of 2008. While there are differences between what’s happening now and what happened then, there’s still a lot we can learn from the folks who made it out the other side.

Here’s some really great advice for making it through a recession from a Millennial who’s been there, and here’s what a few Millennials wish they would have known at the time. You can also try talking with Millennial friends or family members about their own experiences and what you can learn from them. Some of the big takeaways:

Job-hopping, gig work, and freelancing can help you patchwork together an income.
Don’t give up on your dream job, even if you have to take a different path to make ends meet for now.
You’ve got time on your side -- this will pass, and you’ve got a while to figure it all out financially.

3. Prepare yourself for a virtual job hunt.

We’re still not sure how long the country will be physically distancing, but right now it seems like the foreseeable future will be spent at home for nonessential workers. If you’re a recent grad starting your job search, you’ll probably be going through the process remotely. That means you’ll have to prepare accordingly -- these resources can help you:

4. Commit to budgeting and saving.

There’s a lot you can’t control right now, but you can control your cash flow -- that is, freeing up money by cutting out expenses. Here are some ways you can do it:

Get a clear idea of your spending. While you might think you have a handle on where your money’s going, the reality may be a lot different. Take that scary step of opening your debit and credit card statements and track exactly how much is being spent where. It’ll give you a better idea of the places you can cut back. (Use this budget worksheet if you need some guidance.)
Lower your food expenses. In general, members of Gen-Z are known for being really cautious spenders, but the one area they tend to overspend on average is food and dining out. Eating out is already easier to avoid in the era of physical distancing, and for those new to cooking at home, BudgetBytes is a great place to find meals that are simple, delicious, and inexpensive (and it was started by a former struggling college grad back in 2009!).
Cut down on subscriptions. You may not be spending a lot on physical services right now, but those digital ones can really creep up on you over time. No, we’re not asking you to face physical distancing without Netflix to keep you busy -- just trim down on the ones you don’t use as often. There are even apps that can help you do it.
Consider moving back home. We don’t know who needs to hear this, but there is no shame in moving back in with your parents post-grad. In fact, a lot of young people are already doing it. If you’re able to live with your parents or guardians, it can give you a chance to save up some money for the future.

5. Make some extra cash from home.

So maybe the job hunt isn’t going as quickly as you’d like, or you just want to make some extra cash to get through this month. These methods aren’t necessarily going to replace a formal income, but they can help in a pinch.

Sell your unused stuff. From gently used clothes to unwanted electronics, you can sell pretty much anything online (and folks are doing a whole lot of online shopping right now). Browse this list of online sales sites, and find the right one for your stuff.
Offer your skills or expertise. Using a website like Fiverr, you can sell your skills from home to folks who need them. That could be anything from graphic designing and copyediting to voice acting and translating. This guide will help you get started.
Test websites and apps. Yes, there are companies that will pay you to test out and give feedback on their websites and apps -- it’s called user testing. It helps them make sure that their online tools are user-friendly, and you get some extra cash for weighing in. Learn more about making money through user testing here.

6. Explore debt relief options.

Just looking at the Class of 2019, 69% of college students graduated with student loan debt (about $30,000 on average). If you’re already struggling financially, debt repayment certainly doesn’t help.

The good news is, thanks to the federally passed Coronavirus Aid, Relief, and Economic Security (CARES) Act, payments on federal loans will be automatically suspended without interest through September 30, 2020. You shouldn’t have to do anything to qualify, but definitely check in with your federal student loan provider if you have questions.

The CARES Act does not apply to private student loans, so payments on private loans are not automatically suspended -- but you still have some options!

Don’t just ghost your lender. Instead, be proactive in calling your lender about pausing or reducing your payments. That may sound kind of intimidating, but it really comes down to explaining your current situation and asking for help. A lot of these institutions know that students are struggling right now, and they may be able to come up with a temporary solution. Find more detailed instructions here.

7. File for unemployment benefits if you qualify.

The US is experiencing a historic spike in unemployment claims due to coronavirus-related lay-offs, and the CARES Act has also expanded the program dramatically to include benefits for folks who previously would have been considered ineligible.

Each state sets their own guidelines for qualification and application, and you can find more info about your specific state here. When in doubt, apply anyway -- literally the worst that can happen is that they deny you. There’s more general guidance on the application process here.

About 10 million Americans have filed for unemployment benefits so far, so the system is currently really overwhelmed. Expect long loading times if you’re filing a claim online and long wait times if you’re calling in.

8. Take advantage of programs that can help.

If you’re struggling and need some extra help with housing, groceries, or other essentials, there are lots of social service programs that can ease the burden. These tools make it easy to find them:

JustShelter can locate community resources to help you with housing assistance, tenant rights, and legal aid.
Aunt Bertha will help you find free or reduced cost housing, plus so many other services in your area like medical care, food, job training, and transit.
FoodPantries.org can help you find food pantries, soup kitchens, subsidized groceries, and more.
WhyHunger has both an online meal locator and a hotline at 1-800-548-6479.
Feeding America also has a network of food banks, and you can find your local one here.