Manage COVID-19 Credit Card Debt on Unemployment

Published January 2021
Woman holding a bill having financial problems during COVID-19 pandemic

The Coronavirus pandemic has ravaged the country, forcing millions of Americans to file for unemployment benefits. While you may need to make some lifestyle changes on unemployment, you may still be able to keep your credit card debt under control.

Stick to the Essentials

COVID-19 changed the norm when it swept the country earlier this year, leading to shutdowns and stay-at-home orders. Even as restrictions have lifted, life is still not the same and neither are our priorities. This may make it a little easier to stick to a smaller budget while you’re on weekly unemployment benefits.

Make a budget with just the essentials first, for example:

  • Car insurance
  • Health insurance
  • Housing Payment
  • Utilities
  • Add in additional bills in order of importance
You need the Internet to find a job, so your Internet provider would be in this additional important items category. Any non-essential bills that are left over like magazine subscriptions and tennis lessons should be eliminated until you have a steady income again.

Continue eliminating the things you haven’t used much since the start of the pandemic, or bills that won’t be necessary while you’re on unemployment. You’re probably not driving many places during COVID-19, making that satellite radio subscription in your car unnecessary. If something really brings you joy, maybe you can cut back instead of eliminating. Contact your provider and see if you can get a smaller package with fewer channels, for example. Weekly activities may be able to go to biweekly or monthly instead, saving you money.

Once you have a budget and you’ve cut all monthly bills down to the minimum, keep a list of your expenses in your phone or on a piece of paper in your wallet. It will be easy to check before you buy something, eliminating credit card debt before it starts!

Stay on Top of Your Credit Card Bills

Now more than ever, it is essential for you to stay on top of your credit card bill. Even checking your statement for errors could save you money in the long run. While you’re on the limited funds of unemployment, you can’t afford double charges or charges you did not make.

Eliminating errors also ensures that you have the benefit of your full credit limit. While it is usually not good to carry a balance on your credit card, you may not be able to make the full payment while on unemployment. If you can, make sure you pay the minimum or more, if possible. Anything to lower the interest you will owe in the future will help.

If you are unable to keep up with your credit card bills while on unemployment, you should know your debt relief options, including your debt collection rights. We produced a guide to COVID-19 debt relief programs to help you through the pandemic.

Seeking Credit Card Debt Relief

Credit cards can be helpful to get through times of decreased income, such as while receiving unemployment benefits. If you are still able to make your monthly payments on your own and are just looking into what debt relief options are available, you should take a few minutes to read this section on ClearOne Advantage’s website: What is the Best Debt Relief Option for You.

If you are not able to make payments at all you should probably contact your credit card company for any credit card debt relief they may be offering during the pandemic. According to NerdWallet, some credit card issuers are offering waivers on late fees and even deferring payments, though the programs vary. Check with your credit card company to see what benefits they are offering to those who are currently on unemployment benefits.

If you find yourself in deep credit card debt and these tips have not helped, you still have options! ClearOne Advantage is here to help. Contact one of our Certified Debt Specialists at 866-481-1597 to discuss your best debt relief options and get a free savings estimate.

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Topics: Covid Debt Relief