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Covid-19 Stole My Paycheque

Navigating through the unknown is scary and hard, especially with your finances. We are here to make your personal finances simple by focusing on the 5 Key Pillars of Personal Finances and what you should be doing now if Covid-19 stole your paycheque.

Pillar 1: Debt

The loss of income many are facing is making it difficult to make payments towards their basic expenses and debt. Banks, credit card companies, some service companies and the National Student Loan Services (NSLS) are providing short-term assistant in the form of deferrals. Be sure to do your homework and review the terms and add-ons for income loss protection on your credit card, car loans, mortgages and other debts. Leverage these protections to help you get through these tough times. If you do not have these protections, deferrals will provide you temporarily relief in the short-term. Contact your debt and service providers to understand your deferral options. Be sure to ask about:


1. Minimum payment available

2. Deferral interest rate

3. Length of the deferral


Pillar 2: Housing

Housing is typically your biggest expense. However your total housing cost is much more than your rent or mortgage, but includes your utilities, insurance, condo fees and property tax. As stated in the debt section, deferrals are available for your mortgage and other services. If you are renting and are unable to make your rental payment. Try these three things that may allow you to minimize your immediate stress of paying these bills.


1. Communicate with your landlord and offer full transparency with your intention to pay.

2. Try and negotiate a temporarily lower rental cost in the short term.

3. Seek social assistance that to help cover housing cost.


Being unable to pay such large bills causes considerable stress. This is a good time to re-evaluate your total housing cost to ensure you are within 30% of your typical monthly take home pay.


Pillar 3: Resilience Fund

Your resilience fund is your emergency fund that allows you to manage financial emergencies such as income loss. If you do not have a resilience fund, be sure to leverage some of the social aid below to help you during these tough times. Once you have exhausted all your resources including friends, family and social services should you consider debt for your basic needs. IF you do need to incur debt ask your self these 3 questions before doing so:


1. Is this a need or a want?

2. Can I live without it for the next 2 weeks?

3. Is there a social service, friend or family that can provide me with this for free or at a discounted price?


To ensure you are more resilient in tough financial times, be sure to pay yourself and build up a 3-6 month resilient fund for any curve balls life may throw you.



Pillar 4: Retirement Planning

In tough times, regular retirement contributions should be reallocated to basic needs to prevent unnecessary debt. It is not recommended to use your Registered Retirement Savings Plan (RRSP) fund for an emergency. However, depending on your specific situation, this may be better solution instead of taking on large high interest debt. Leveraging funds from your Tax-Free Savings Account (TFSA) may be a more appropriate source of money. Before making these decisions consult a financial advisor!


When life gets back to normal, be sure to resume your regular contribution to your RRSP and TFSA. This is an investment in your future self.


Pillar 5: Credit Worthiness

Protecting your current credit score is going to be very important during this time. Utilize many of the resources currently available to subsidize your income to pay for your necessities and debt. The impact deferrals will have on your credit score is currently unknown. To reduce this, only use the deferrals available as a last resort. Preserving your credit score is important to your overall financial health.


To preserve your credit score as much as possible:

1. Take on as little additional debt as possible

2. Make the minimum payments on all your debts included services such as your phone bill, utilities and insurance

3. Leverage your income loss prevention aids available to you



Planning for your finances using the 5 Key Pillars of Personal Finances will help you preserve your overall financial position during these tough times. Join our count down to the ChargeScore by per-registering at BeInCharge.ca. Get your ChargeScore so you can understand, track and improve your current financial position and better manage touch times like these.



By Shalicia Harris


Social Aid Links:

Canada Emergency Response Benefit

Eligible to file for EI benefits

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Toronto, ON

Canada