Making Cents: 'How to manage financial anxiety during Covid-19 (part 1)' - Liam Croke

Four weeks ago, a client of mine who’s a self-employed consultant was telling me how much she was looking forward to attending a conference, where she was going to be one of the keynote speakers.

The event was cancelled because of Covid-19 and of course she understands why, and completely gets why we have to practice social distancing. But being self-employed and the primary income earner in her household, she’s become extremely anxious about how long her savings will last for, how long before she’ll start missing utility bills etc. because the gap between what her monthly outgoings are, and the €350 she’s receiving each week from the state is quite large.

And it’s such an unusual position for her to be in, because up until now she’s never had to worry about money, she’s always been very comfortable, and always managed her finances the way she was told to i.e. saved hard, followed a monthly budget etc.

Applying for the Covid-19 unemployment benefit was a difficult thing for her to do. In her wildest dreams, she never thought that with her qualifications, employer history, work experience, existing client base, that it would ever come to this.

I mean, four weeks ago, she was turning down new business because she was so busy, and now she’s applying for unemployment benefit.

And understandably, she isn’t sleeping very well and has become anxious and frightened. She’s frightened of what the future holds because she was always the person in control, and that loss of control has now manifested itself into a feeling of stress, a feeling she never had before from a career or financial perspective.

To say what she’s experiencing is normal would be an understatement. Hundreds of thousands of people in Ireland are feeling financially stressed, and millions more across the world.

On a very practical level, it’s stressful trying to cover day to day expenses when you’re income has been reduced. You’re trying to stay positive, hoping things will return to some sort of normality soon, but that can be hard as well, and it’s easy to let your mind wander and begin to think, what if it doesn’t, and what happens if your employer doesn’t re-open when restrictions are lifted, how long will it take before you get a job, how will banks deal with missed mortgage repayments when things begin to return to normal? Are they going to be calling you and sending your threatening letters etc.

And they’re not, but it’s difficult to think otherwise, because with so much time on your hands, its’ easy to start thinking all sorts of terrible things will happen.

Making assumptions about the future, before they happen is the reason why people suffer from anxiety, and because there are lots of things swirling around in your head at the moment, I want to try help and try ease that worry, so I’m going to give you some suggestions this week and next which I’m hoping you won’t find patronising because they’re so not meant to be. And I’m hoping if you take heed of some of them, they may help.

As John Kabat Zinn, once said, you can’t stop the waves’, but you can learn to surf.

What I’m about to suggest by the way, applies to everyone, whether they’re in, or out of employment at the moment.

And they fall under eight headings, with four this week, and the remaining four next week. I thought they were too important to try and cram into one article, hence the reason I’m spacing them out over two weeks.

Know what benefits your eligible for

The government has put in place an emergency Covid-19 pandemic unemployment benefit, which is available to self-employed people and employees who have lost their job because of Covid-19. The payment amounts to €350 per week. The easiest and quickest way to apply for this payment, if you haven’t done so already is via MyWelfare.ie. When you do, all you need is your email address, PPS number and your bank account details.

There is also the Covid-19 wage subsidy scheme, which reimburses employers (subject to meeting certain criteria) who are willing and have an ability to continue to pay staff some or all of their income. Employers will be reimbursed by the state for payments made up to 85% of employees’ normal net weekly pay if their income is less than €24,000, and those earning between €38,000 and €76,000 can receive up to €350 per week.

Get help

If this is the first time something like this has happened to you, I would urge you to get help.

People often make the mistake of trying to solve problems on their own, and because they may never have experienced a loss of income or redundancy before, they make decisions based on opinions and hearsay rather than cold hard facts.

The Money Advice & Budgeting Service (MABS) are not providing one to one support at the moment, but they are via email, phone and I’m sure they can arrange Zoom/Skype calls with you as well. And they are an excellent resource and one you should use, if you’re feeling anxious or overwhelmed. They can help you with monthly budgeting and talk your through how to make contact with creditors and tell you what you’ll need to do, what to say etc.

And if you happen to be still in employment but worried about what the future might hold, your company might have an employee assistance programme (EAP) made available via its’ health insurance provider. They provide confidential counselling services to people in financially difficulty and it might be worth having a call with them.

Accept what’s going on

It’s unprecedented, incredible, shocking, crazy, mad, unbelievable. There are so many adjectives you could use to describe what we’re currently going through, but no matter how many we use, it won’t change anything.

We’ve got to accept that things might not go back to normal for some time, and maybe the world will never be the same again, who knows. We have to let things play out and trust the advice we’re being given and following is for everyone’s benefit. Governments all over the world are all working at finding solutions, and hundreds of pharmaceutical companies are working 24/7, trying to produce a vaccine, and they will be successful.

As individuals, we simply can’t control what’s going on, we’ve just got to accept it is what it is, and if we try and let it go, we can significantly reduce our stress levels.

Make one decision at a time

It can be difficult to find a starting point, when you’re feeling anxious about money. And when you’re faced with having to do things you’ve never encountered before, and you have to make multiple decisions, in a short space of time i.e. claim for C19 unemployment payment, contact bank, make a monthly budget etc. it can be overwhelming and only adds to your stress levels.

Research has shown that when this happens, your willpower, and energy levels drop, and you end up doing nothing or only half of what you should have done.

You can overcome this is by siting down and taking your time and mapping out what decisions you have or need to make. If that strategy works for you and it means deciding on a Monday, you’re going to log online and file for C19 unemployment benefit, on Tuesday you’re going to contact your mortgage provider, on Wednesday your Credit Union, on Thursday review your monthly budget etc. then great, do that.

Liam Croke is MD of Harmonics Financial Ltd,

based in Plassey. He can be contacted at liam@harmonics.ie or www.harmonics.ie