Navigating Your Finances as Post-Pandemic Changes Approach

As the suspension of student loan payments comes to a close, there’s an ongoing discussion about a possible extension.

This Week In Your Wallet: Facing Financial Changes

It’s that time again—not just the back-to-school season or the last days of summer. I’m referring to the expiration of financial protections enacted during the pandemic. Most of these benefits will fade in the next month or two, signaling you need to prepare for your new financial situation right away. So, what should you be focusing on?

Student Loan Payments Resuming:

For federal student loan borrowers, the last 17 months have been a welcomed relief, with payments paused and interest rates at zero since March 2020. Collections on defaulted loans were also halted. While some borrowers took advantage of this zero percent interest to pay down their principal more effectively, many did not. Currently, the pause is set to end on September 30. Borrowers should connect with their loan servicers to ensure their information is current, confirm when payments will restart, and assess their ability to manage these payments. If affordability is a concern, looking into an income-driven repayment plan should be a priority.

Health Insurance Aid Ending:

August 15 is fast approaching, marking the end of a special open enrollment period that allowed consumers to explore their coverage options at Healthcare.gov. If you haven’t explored this because you think coverage is too expensive, check it out now. The American Rescue Plan has made subsidies available to more individuals, and these benefits will last through 2022. If you lost your job and, consequently, your health insurance, you might qualify for a tax credit that covers your premiums, but that expires at the end of this year. Take action before it’s too late.

Mortgage Payments Restarting:

Pausing federally backed mortgage payments (Fannie Mae, Freddie Mac, FHA, VA) required some effort compared to student loans. Borrowers had to reach out to servicers to request forbearance, which they could receive in six-month increments for up to 18 months. As Ron Lieber and Tara Siegel Bernard explain, if you began this process in March 2020, you may be nearing the conclusion of your forbearance. Expect your loan servicer to contact you with options, such as adding missed payments to the end of your loan or modifying your loan terms. If you haven’t applied for forbearance but are facing financial challenges, it’s still possible to do so. Note that foreclosures on federally-backed mortgages are paused—but only until the end of this month.

For additional resources: The New York Times offers a thorough overview of upcoming changes that may impact you. Click here for insights on internet service subsidies, expanded deductions for charitable donations (even if you don’t itemize), and the conclusion of supplemental unemployment benefits.

Market Overview

Yesterday marked the worst performance for the market since October, with the Dow dropping approximately 700 points after losing about 300 points the previous Friday. As I check in today, there’s potential for recovery. The decline was driven by rising COVID concerns. While cases are up significantly, experts note that hospitalizations and deaths haven’t surged at the same rate, indicating vaccine effectiveness. However, it’s not solely about COVID or inflation this week. According to Fortune’s Bernhard Warner, the bond market rallied as stocks fell, suggesting that investors are seeking safety in treasury bonds amidst uncertainty. Concerns about economic growth and corporate profits peaking are emerging. Will we see more days like yesterday? It seems likely as this trend has been building for some time.

Job Market Insights

This week, we’re focusing on hiring as we welcome back our summer intern as a full-time team member. We chose her not just for finance knowledge but for her impressive communication skills and ability to present complex information engagingly. Another example is a new hire who spent the pandemic gaining skills like Google Analytics and SEO, making her a strong candidate for her desired position.

As Irina Novoselsky, CEO of CareerBuilder, shared on our latest podcast, now is a great time for job seekers looking to transition roles or industries. Crafting a resume that tells the story of how your current skills translate to a new field is essential. Discover more about this here.