Posted on : Thursday August 20, 2020

By Tom Stolle

The current global pandemic has wreaked havoc on our personal lives. We have witnessed a shutdown in the US economy in varying degrees. Some individuals have lost jobs. Others have taken reductions in pay. Many have family members, friends, coworkers, or associates who have been infected, become ill, or perhaps died. Schools have closed, affecting our young people. Many have felt the impact on their mental health.

It sounds bleak. It feels bad.

We live in an imperfect, fallen world. Consider the following Scripture references:

“I have told you these things, so that in me you may have peace. In this world you will have trouble. But take heart! I have overcome the world. John 16:33 (NIV)

Peace I leave with you. My peace I give to you. I do not give to you as the world gives. Don’t let your heart be troubled or fearful. John 14:27 

Life does not always go the way we want. We will have trouble, but our Lord has this in His hands. Therefore, if we place ourselves in His hands, we will be fine, no matter the earthly outcome.

Dr. James Painter, the senior pastor of Cresthill Church in Bowie, Maryland, has stated many times, People have two types of memory. One is short, the other is convenient. The truth is, as humans, we easily forget. We forget facts, figures, details and stories. If we are not careful, we can even fail to remember or consider that our God is faithful. He has everything, even a global pandemic, in His hands.

What can we do to financially navigate these uncertain times? I would submit there are many steps we can take, depending on our circumstances.

Make a financial plan and stick to it
The establishment of a budget is one very important step. Many individuals, couples, and families do not create a budget. Perhaps this is one reason why Americans tend to spend approximately 70 percent of their money on housing, transportation, and food. (Business Insider, Lauren Lyons Cole, July 10, 2017). Prepare a budget and stick to it.

Speaking of transportation, did you know that the auto loan debts of American consumers total approximately $1.2 trillion in 2020 and this that debt comprises 10 percent of the average household debt? Only mortgages and student loans comprise a higher percentage of household debt. (Investopedia, Amy Fontinelle, January 13, 2020).

One reason for these decisions is that a careful financial plan has not been implemented prior to these purchases.

The preparation of a budget involves accurately stating income and expenses and ADJUSTING your spending, and perhaps your income, to meet goals, such as establishing an emergency savings fund. Creating or expanding a savings fund is important. If you do not have many or any savings today, successfully establishing this savings fund will allow you to better weather your life’s next financial crisis.

Whatever your condition is financially, you start where you are at. Some individuals have a shorter journey, while some face a long road. Whatever your road, the following are some suggestions that, depending on your situation, you may be able to take during this COVID-19 season to become more financially healthy:

  • Consider refinancing your home mortgage. Current mortgage interest rates are incredibly low. Thirty-year mortgage rates are averaging under 3% and are even lower when refinancing for a 15-year loan. If you can refinance, this could result in hundreds of dollars of monthly savings and many thousands of dollars of savings over the life on the loan. The result can be the best of both worlds — needed cash now and the potential to save much more cash in the future.
  • Consider paying down federal student loans. The federal government has deferred federal student loan debt and has temporarily reduced interest on these loans to zero. This is an excellent opportunity to eliminate debt if you can. You could save many dollars in interest over time. However, even if you cannot make student loan payments due to the impact on your finances during this time, perhaps you can pay on other debts as the student loans have been deferred.
  • Consider dining out less often. During this pandemic, you may want to consider not dining out as much. Maybe you can also choose to forego ordering take-out, which is a very popular option in the pandemic. Did you know that Americans spend 43 percent, on average, of their annual food expenditures on dining out! (Business Insider, Alex Morrell, February 17, 2017). This could represent an area where a family could realize significant savings.
  • Consider contacting creditors. If you have fallen behind on an auto loan, credit card debt, or other loans, perhaps contacting the creditor and working out a revised payment plan could be a good option. During this COVID-19 season, creditors may be willing to adjust interest rates, change when your payments are due, or perhaps offer a deferral of grant an extension of time for payment.
  • Consider price-shopping essential products. You may recognize monthly savings by price-shopping for items such as auto insurance, internet providers, cell phone service providers, TV service providers (perhaps consider cord-cutting), and homeowners’ insurance or renters’ insurance. Perhaps some of your current providers may be willing to renegotiate fees to retain you as a customer.
  • Caution: do not withdraw funds from retirement savings unless your situation is dire. Individuals will need funds at retirement. Early withdrawal of these funds may have significant consequences for the future. The most desirable path forward is for an individual to leave this money alone, make contributions, and allow these funds to grow.

What does the recent past tell us?
When the economy severely crashed in 2008, many were worried. We watched as stock values, retirement account values, and home prices plummeted. Investment values ultimately recovered. Home prices have approximated all-time highs since the end of 2016. Remember that the housing market crashed just eight years prior to then.

The economy faces ups and downs. We experience bull and bear markets. We should not be consumed by worry about this. We cannot control it. However, we should make prudent plans for the future.

The plans of the diligent lead to profit as surely as haste leads to poverty. Proverbs 21:5 (NIV)

Helping the poor
Many perhaps have significantly fewer available resources. The steps described above may not be as helpful to them. These people hurt and struggle no matter the season. We may be concerned about bull and bear markets. But others may be just trying to make it to another day. Many people exist in a reality that others have not experienced or do not understand.

As believers, we should help others who are struggling.

Caring for the poor is lending to the Lord, and you will be well repaid. Proverbs 19:17 (CEV)

If we have all we need and see one of our own people in need, we must have pity on that person, or else we cannot say we love God. Children, you show love for others by truly helping them, and not merely by talking about it. 1 John 3:17-18 (CEV)

God calls us, as His children, to help others in need. Consider that perhaps God has blessed you with more to help others who are in need or have less. Perhaps God has sustained you or blessed you financially during this COVID-19 season.

Perhaps your church has a benevolence ministry or other types of ministries that help others in need. Ask your pastor or other church leaders how you can get involved in helping those around you who desperately need help.

For there will never cease to be poor people in the land; that is why I am commanding you, ‘Open your hand willingly to your poor and needy brother in your land.’ Deuteronomy 15:11

Make prudent plans. Work hard. Live responsibly. Help others in need. Trust God.

Unless noted, all Scripture quotations are from the Christian Standard Bible.

Tom Stolle is the associate executive director of the Baptist Convention of Maryland/Delaware and chief financial officer