Chip's money tips

Do you live paycheck-to-paycheck? Has this virus cut your hours partly or completely? Is your cash flow running low? Are you concerned about making rent? Here are a few suggestions as to how to weather this financial storm:

1. Make sure you file for unemployment in your state. Your employers have paid into the system through payroll taxes. The states issue the checks. Don’t think of it as charity. Think of it as compensation from your employers for rainy days like this. If it still doesn’t sit well, you can always use it now and donate back to the state’s treasury when we get back to normal.
2. Ask if your employer or union has a disaster relief fund to which you can apply. For example, my union has the SAGAFTRA Foundation COVID-19 Disaster Fund. The Fund covers “members who are in an emergency financial crisis related to COVID-19 (Coronavirus) to cover basic expenses such as rent, mortgage, utilities, medical bills and other essential needs.”
3. You know if there is a way to work a credit card to my benefit, I will! Get yourself a credit card that charges 0% interest on new purchases for up to 21 months. We’ll be out of the woods way before then! All you have to do is pay the minimum amount due to keep the 0% rate.

Get ahead of this financial problem – NOW. I know a lot of people do not have a cushion. Use the 0% card as a safety net – in case. Use the card to pay for everything you buy. When the credit card bill comes in a month, all you have to pay to keep the 0% interest is the minimum payment. This will give you the flexibility to use what cash you have to pay your rent / mortgage and taxes. I use a credit card to pay for everything possible in my daily life. Mortgage and taxes are the only things that would charge me a fee if I used a credit card.

How much is the minimum payment on a 0% card?

You will see the minimum payment in the terms and conditions of the card during the application process. The industry standard is now to calculate the minimum as all fees and interest due that month plus one percent of the principal amount owed. Since you would not owe any interest because you paid the minimum every month, and you would not use the card for a cash advance, you should not have any interest or fees. Therefore, for example, 1% of $1,000 is $10. YOU must confirm the minimum payment in the Terms and Conditions when you apply.

I heard I can’t get evicted because of COVID-19

That’s true in many cities. Remember, that does not mean you get to live rent-free. It also means you may get hit with late fees. In Los Angeles, where I live,  you have to get caught up on the rent you owe in six months.

Is it possible to pay your rent with a credit card?

Yes, but there is a fee. Use Plastiq to pay your rent/mortgage. Here’s my referral code: 1501567

Plastiq.com says they “enable payments to the 90% of businesses that don’t accept credit cards.”. Plastiq charges you 2.5%. That’s a $25 fee per $1,000, but that is probably cheaper than late fees. Signup and use my referral code 1501567 and you will get 500 FFDs off fees.