A Pandemic Financial Guide for Millennials

Many companies and institutions have hardship programs to help debtors during difficult times. If you are struggling to pay off student loans, your mortgage or credit card debt, call your lenders and discuss your payment options. “Financial accommodations are generally readily available right now,” said Amy Thomann, the head of consumer credit education at TransUnion, a credit reporting agency. “Lenders, just like consumers, understand the hardships that are going on in the economy.”

If your lender agrees to defer your payments or lower your interest rates, Mr. Kelly recommends putting the amount you would have owed into an emergency fund.

Speaking of interest rates — they are extremely low right now, so read up on incentives and find out whether this is a good time to refinance your mortgage or private student loan, said Taha Choukhmane, an assistant professor of finance at the Massachusetts Institute of Technology.

Whatever you do, don’t allow your debt to pile up. “The worst thing you can do in a tough financial situation is just to let it accumulate and not face it up front,” Dr. Choukhmane said.

If you are still working but don’t have an emergency fund, start one. The economy remains precarious, so it’s best to plan ahead as much as possible.

“We always talk about saving for a rainy day,” said Ms. Palmer. “This is the rainy day.”

In an ideal world, you should put away three months worth of expenses, she added. If that’s not feasible, save at least $1,000 in the event that you need something to fall back on down the line.

If you are facing dire circumstances and have a retirement account, one option is to make an early withdrawal. Under the Coronavirus Aid, Relief and Economic Security Act, individuals affected by the coronavirus may qualify to withdraw up to $100,000 from their plans through Dec. 30 without the 10-percent penalty that typically applies to those under 59 and a half. You would have to pay income taxes on the amount, but the payments can be spread out over the next three years. You could also pay back the distribution anytime during that period and claim a tax refund on the taxes you’ve already paid.

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