The Coronavirus and resultant economic shockwave, has caught many people by surprise, financially speaking. You too may lose or have lost your job and this raises the question of how long can you or would you survive without your primary source of income. Therefore, it’s crucial to know how to crisis-manage your personal finances.

For example, 63% of US households have less than $500 to cover an emergency, and this falls to just 32% in the UK with 41% having less than £1000. Given the current situation, with many in the UK getting laid off, or furloughed, this doesn’t bode well. You might, therefore, be left wondering, how long you can last in this crisis.

When we arrived in Australia in early March 2020, Miss MSU had a 10 week, $45 an hour job lined up, and I had high expectations of landing something myself. We also thought that we would be able to use Trusted House Sitters. However, her job got pushed by a month (we were worried it would get cancelled), the rest of the job market seemed to evaporate overnight and there are no Trusted House Sits because no one is travelling. This is how quickly times can change!

Initiate ‘Survival Mode’

Even though we had lots of savings, we didn’t want to waste them all. We were acutely aware that we were going to get locked down in temporary accommodation and even if we wanted to get back to the UK flights were being cancelled every day. With people spending thousands of pounds on flights, only for them to get cancelled with the refund delayed.

With the thought of being stranded in Australia with a lack of work opportunities, we went into cost cutting crisis mode. We were in a lucky position of just having accommodation and food to pay for. However, here are some steps we followed and some suggestions on what you can do to sure up your finances.

Since then we’ve actually managed to earn and save somewhere in the region of $10,000 from temporary work contracts. We also got lucky with accommodation and have been renting an ex-Airbnb for just $300 a week including bills. This has meant that we haven’t had to touch our savings or investments since arriving in Australia.


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1. Breakdown Your Finances

This step is essential: you need to know where you stand, and stress test your personal finances, and also look at your expenses and identify where you can reduce them. You can use my excel template to stress test your finances and see how long you can last with restricted or no income.

Write Down Your Income, Assets, Liabilities

You can use either a pen and paper or an excel spreadsheet to do this. You can even use the downloadable spreadsheet to write to do this and calculate how long you can last. It’s a simple but effective tool.

However, simply write down all your monthly paycheck, cash on hand, savings and any forms of income. Write down all the expenses and bills you pay each month. Detract one from the other, and then use this as the starting balance for the following month, applying the same logic. You can use my free net worth excel template to do this. Click here to download.

2. Take Payment Breaks

Mortgage Holidays

If you think you’ll struggle to make your monthly mortgage payments because of coronavirus, you can agree to things like a 3-month payment holiday. This will give you a break from paying your mortgage but it won’t affect your credit rating. Banks offering this include:

However, interest may continue to build at the usual interest rate during the holiday and the total amount you will pay over the term of the mortgage will increase. So you may end up paying a higher monthly payment.

Banks may also be willing to offer more long-term support or holiday payments. However there are also other options you can consider such as

  • Making an underpayment if you have an overpayment reserve
  • Switching your existing deal if you’re eligible
  • Changing the term of your mortgage.

Credit Card Holidays

Lenders such Halifax are now also offering credit card holidays where you can defer paying the minimum or full repayment for 3 months, without even speaking to them and this has no impact on your credit rating. However, similar to the mortgage holidays, the interest may still be accrued and the minimum repayment will increase.

3. Negotiate Your Expenses

There may be many providers which may be flexible to your situation (e.g. SKY TV). However, one of the best things people can do right now, if you are renting, is to negotiate your rent with your landlord/landlady. Even if it’s just 5% for 6 months as someone I know has done with his £16000/pcm London rent. That’s £80 a month and a total of £480 he will save over this period.

They may be able to afford to reduce your rent for being a good tenant. However, remember that we are now entering a down housing market which can suppress prices, which gives you the option to go in search of cheaper rent.

We were lucky to take advantage of this situation in Melbourne, with surplus rooms and apartments to rent. Due to the drop in demand for Airbnbs, they have converted their offering to short/long term rentals at budget prices.

As I mentioned, we snapped up an Airbnb Plus in Melbourne for $300 a week including bills – that’s the same price we were paying in the UK without bills. Melbourne rents should, in theory, be 20-30% higher than where we were living in the UK. I’m not sure what you will have in the country you are in but in Australia a couple of the sites we looked on were:

4. Streamline Your Spending

Cut all unnecessary costs out, cut any subscriptions that you don’t need but keep the ones that will help you maintain your sanity (e.g. Netflix). Streamline your grocery shopping by writing a list and meal prepping, and buying items and ingredients that can be used multi-purposefully.

However, remember to treat yourself with 1 or 2 things, so that you don’t feel terrible and like you can’t have anything. In times like this you need to maintain your moral and wellbeing. If you look after yourself then positive things will follow eventually.

5. What Can You Sell?

When we left the UK we managed to sell around £800 of household items. Many were things that we did not consistently use and did not add value. Go through and mercilessly sell:

  • Clothes
  • Electrical items e.g. spare tvs.
  • Furniture
  • Kitchen gadgets
  • Novelty items
  • You could even make things to sell.

List them on Ebay and Facebook Marketplace to raise enough cash. You might even make enough to cover a month’s expenditure.

Keep Calm & Carry On

Remember to stay positive and try to earn more money, you can try and sell things online or set-up a blog to try and earn money online. Even if this doesn’t work out now, the extra work may improve your situation long-term.

Also, keep in mind that you have to manage your own psychological well being, so remember to do the things that keep you healthy, such as eating well, exercising, treating yourself, and staying entertained/psychologically active.

These can be extremely stressful times because of money, and so if you can look after yourself first. There are the means and methods to defer payments until you get back on your feet, but take action to cut costs and increase cash flow and you will come out the other side.