Seek assistance, avoid debt, track expenses and get creative, is the budgeting advice to get through the lockdown. Photo / 123RF
Seek assistance, avoid debt, track expenses and get creative, is the budgeting advice to get through the lockdown. Photo / 123RF
The number of Kiwis seeking budgeting advice and food packages as the Covid-19 lockdown looms has skyrocketed but experts say there is plenty of help for everyone to get through.
Tens of thousands of jobs are expected to be affected as the virus takes a grip on the country andthe economy.
Non-essential services and businesses will also be shut down with only remote work allowed from midnight tonight as the country goes into alert level 4 over the next four weeks.
While the Government has announced a stimulus package including a wage subsidy scheme and leave payment, many Kiwis are facing an uncertain economic future with potential job losses, loss of income and unforeseen expenses.
Māngere Budgeting Services Trust CEO Darryl Evans said this morning when their lines opened at 6am the phone started running hot - fielding 43 calls by 7.30 am.
During the lockdown employers should do everything they can to allow people to work from home.
Where that was not possible, employers could access the Government's wage subsidy scheme, provided they continued to pay employees 80 per cent of their normal salary for 12 weeks and made their best efforts to keep them employed.
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Employers could also apply for the Covid-19 Leave Payment that would see their employee being paid $585.50 a week for full-time workers, while part-time employees (fewer than 20 hours a week) should get $350 a week for 12 weeks.
Evans said in the first instance anybody on a low income and who was worried about finances should seek assistance, calling Work and Income, and a budgeting advisory service, such as Māngere Budgeting Services Trust on 09 275 2266.
While they were closing down the physical address from tomorrow, staff would be working remotely and continue to give advice over the phones and be able to organise food packages, which had also been in heavy demand.
"We have had a huge increase in demand for food parcels too, and while we will be continuing to distribute these we will need some assistance to restock."
During the four-week lockdown Evans said people should look to rein in their spending.
"Even though there will be no shops open, people are still spending big online, bulk and panic-buying too. Our advice would be to keep a close track of expenses during this uncertain period, and only buy what you need so enough is available for those who are more vulnerable."
If people were struggling with expenses or debt, they should reach out to their creditor, Evans said,
"If you are struggling with your rent, call your landlord, or with power or gas bills, call your supplier. If people are upfront they will generally be reasonable to deal with. I don't think anybody is going to be shutting off the power during this period."
The $25 increase to benefits and pensions and doubling of the winter energy payment would also help people get through the tough period, especially as the weather became cooler and power bills could increase, Davis said.
"Last winter for many it was not enough and was used on food rather than energy. This increase means they can be fed and be warm."
Pensioners were particularly at risk from Covid-19 and being on a fixed income made it difficult to purchase extra items needed.
This week Davis and his team delivered 1200 pensioner care packages with items specifically related to Covid-19 and hygiene.
"For many on fixed incomes they cannot afford the extra items needed. Not one house turned it down, they were extremely grateful and generally the message was they didn't know anybody cared."
New Zealanders worried about money due to the effects of coronavirus are also urged to seek guidance through official government services Sorted and MoneyTalks.
FinCap chief executive Tim Barnett said the MoneyTalks helpline would give callers access to expert financial mentors via phone, text, live chat and email.
"We are looking to scale up MoneyTalks to meet the anticipated demand.
"We'll be using our digital channels including the MoneyTalks blog, Facebook page and Cheaper Living New Zealand Facebook group to provide support and advice to New Zealanders during this difficult time."
The Sorted website also offered tips, guides and tools.
Head Jane Wrightson said during this time of uncertainty they urged people not to rush into taking on more debt until they have consulted expert sources.
The Financial Markets Authority was talking with financial service providers to ensure they were taking customer needs into account, and had sufficient resource in their call centres to deal with people through this stressful period, she said.
"If you have debt or are struggling with your bills financial institutions and creditors should be cooperative with you at this time," FinCap chief executive Tim Barnett said.
The MoneyTalks helpline can give support and guidance on how to deal with them.
Avoid new debt
People should avoid as much as possible during this time, Barnett said.
"Reduce your expenses, and seek financial supports from the Government before taking out new loans.
"No one knows how long we will be in lockdown for or what the world will look like afterwards.
"Debt is an obligation on your future self and for now there's too much uncertainty about what your future self may be able to afford."
Track your expenses
While some expenses will go down because as people stay at home - for example, petrol, transport, shopping and entertainment - other expenses will rise such as power, gas, internet and grocery bills.
"Track your expenses to see what changes are happening so you can adjust through the lockdown period," Barnett said.
"Use this time to think about what your essential costs are and cut out expenses that aren't necessary. This will help you beyond the lockdown."
Different families will have different eating habits and pantry stocks, but it's likely there will be ingredients at the back of the pantry hardly used, including seasoning packets, and leftover ingredients you bought for a dish you cooked a year ago.
"Before rushing out to the supermarket, where there are unlikely to be specials at this time, go through your fridge freezer and pantry and plan your meals for the week using as much as you can from your stocks and only going to the supermarket for the ingredients you need to complete those meals," Barnett said.
"This will help you limit the number of times you go to the supermarket and help you keep your costs down."
Sorted: https://sorted.org.nz/ or email office@sorted.org.nz
MoneyTalks: https://www.moneytalks.co.nz/, phone 0800 345 123, email help@moneytalks.co.nz, or text 4029.
