Smart Money Podcast: Coronavirus Edition

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Smart Money Podcast: Coronavirus Edition
Written by Liz Weston, CFP(r) Senior Writer | Personal finance economics, credit scores, Liz Weston, CFP(r) is a personal financial columnist co-host of"Smart Money," the "Smart Money" podcast an award-winning journalist, and the writer of 5 books about financial matters, among them the bestseller "Your credit score." Liz has appeared on numerous national television and radio programs including the "Today" program "NBC nightly news,"" as well as the "Dr. Phil" show, as well as "All All Things Considered." Her columns are carried by The Associated Press and appear in a variety of media outlets weekly. Before joining NerdWallet, she wrote articles for MSN, Reuters, AARP The Magazine and the Los Angeles Times. She lives located in Los Angeles with a husband as well as a daughter, and a co-dependent golden retriever.




and Sean Pyles Senior Writer | Personal finance and credit Sean Pyles leads podcasting at NerdWallet as the producer and host of NerdWallet's "Smart Money" podcast. The show "Smart Money" Sean talks with Nerds from NerdWallet's NerdWallet Content team to answer the listeners' questions about personal finance. With a focus on thoughtful and practical advice on money, Sean provides real-world guidance that can help consumers better their financial lives. In addition to answering listeners' financial questions on "Smart Money," Sean also interviews guests who are not part of NerdWallet and produces special segments on topics like the racial wealth gap as well as how to get started investing and the history for student loans.
Before Sean lead podcasting at NerdWallet, he covered topics that dealt with consumer debt. His writing has been featured throughout the media including USA Today, The New York Times and other publications. When Sean isn't writing about personal finances, Sean can be found digging around his garden, going for runs , and walking his dog for long walks. He lives within Ocean Shores, Washington.





Mar 23 Mar 23, 2020


Edited by Kathy Hinson Lead Assigning Editor Personal finance, credit scoring, managing money and debt Kathy Hinson leads the core personal finance team at NerdWallet. Previously, she spent 18 years with The Oregonian in Portland in capacities such as chief of the copy desk and team leader for design and editing. Her previous experience includes copy and news editing for several Southern California newspapers, including the Los Angeles Times. She received a bachelor's degree in mass communications and journalism from The University of Iowa.







The majority or all of the items featured on this page come from our partners, who pay us. This impacts the types of products we review as well as the place and way the product is featured on the page. However, this doesn't affect our assessments. Our opinions are our own. Here's a list of and .



We're pleased to welcome you to the NerdWallet's Smart Money podcast, where we address your real-world money concerns in 15 minutes or less.
This week's theme is the coronavirus outbreak and how you can prepare financially in case of a aftermath.
Be aware of where every penny gets spent
Look for ways you can spend your money on the things you love and spend less on things you don't.






Our view
The financial consequences associated with the new coronavirus as well as COVID-19 that it causes are likely to be profound, with many people losing their jobs or seeing their hours cut as the economy slows. It might be too late to put together an emergency fund for three months however it is sensible to cut down on spending whenever possible, and to save money to provide yourself a small buffer.
Credit cards can be helpful in a situation of crisis. If you have a good credit score, you could be eligible to apply for an account that has a zero-interest teaser rate. If you don't have great credit may want to get payday loans, but those aren't cheap and can be extremely expensive. Look instead for . Consider other community resources, for instance, Jewish Free Loan Association. Jewish Free Loan Association.
If you're unable to pay your bills, try to prioritize the necessities like shelter, food, utilities and transportation. Check with your lender to determine if hardship programs might be available.
The crisis also has been a major influence on the market for stocks and has caused dramatic swings as a result of the economic uncertainty. If you're a decade or more away from having to use the money you have invested (if your retirement is more than 10 years away such as, for instance -- it's okay to treat the volatility as background noise. If you're closer to retirement or already in retirement or near retirement, you could . Now is a good time to talk to an unpaid, fiduciary financial planner for a second opinion about whether your retirement plan and investment allocations are still a good idea.
Of course, everyone's traveling plans are disrupted. often doesn't cover this type of disruption, however .
Our tips
Concentrate on the things you are able to control, not on what you aren't able to control. It is important to be informed, but not to take too much of the bad news. You should consider limiting the time you spend on news feeds.
Prioritize your bills. If you can't pay all your bills pay for the essential: shelter, food, utilities, transportation.
It is advisable to invest for the long run. The stock market will eventually settle and then recover. If the goal of your investments is more than 10 years in the future, then you are able to ignore the day-to-day swings.
More on coronavirus on NerdWallet:
Have a money question? Text us or call to us on 901-730-6373. Or you can email us at . To hear previous episodes, return to the
Episode transcript

Sean Pyles: Welcome on the Smart Money podcast, where we answer your money questions within 15 minutes or less. I'm Sean Pyles.
Liz Weston: And I'm Liz Weston. Always be sure to email us any questions regarding your money. Contact us by phone or text by texting us at (901) 730-6373. That's (901) 730-NERD. Contact us via email at
Sean In this episode, we're going to tackle a subject that we've received a number of inquiries about over the last couple of weeks: coronavirus, and how to prepare your finances for its. The effects of the novel coronavirus as well as the COVID-19 virus which it causes are becoming evident in the American economy. A lot of workers are having their hours cut or are being laid off. The market is in an upswing and many are trying to figure out how to brace for the worst, and that could mean bolstering your finances and for some, increasing the amount of toilet paper in your home.
Liz: Sean, you claimed that you thought it was an absurdity, but you realized it's not.
Sean Then I went to the store just last night and there were no shelves.
Liz: Yeah.
Sean: I'm glad having one of the Amazon subscriptions where I purchase every month because I'd be there, grabbing napkins. What's the likelihood? It's a serious issue. A lot of people are really anxious right now and lots of people will be in a poor financial situation.
Liz Then in this episode of the NerdWallet Smart Money podcast, we'll discuss how to prepare your financial and mental health, what to do if you are unable to pay your bills and why this is an ideal time to learn patience when it comes to investing.
Sean: All right Let's get started.
Liz: Okay, let's start with the mental preparation part because I think this is putting a strain on people in ways maybe they didn't expect.
Sean: Yeah.
Liz Lisa: So Sean, what's going on with you?
Sean: Well, I'm sure I'll fall down a news hole when this occurs. It's simply looking on Twitter and listening to radio and becoming really caught up with these instant-to-minute updates, and to me that causes me to feel nervous. I believe that I do this because I'm trying to regain any semblance or control. However, in reality, I'm hearing about things that I don't have any control over. And I think that most people are experiencing the same anxiety since it's a very serious situation and there's a lot of uncertainty. So one thing that I believe is beneficial to think about is to recognize their anxieties and not obsess over what they cannot manage. Instead, focus on the things you can control, like how much you wash your hands, or the type of news that you're reading and the frequency of that news consumption.
Liz: I think putting some limits on this is very clever. It's true that you want to be a prepared citizen, you want to know the current situation However, I think we all have a tipping level where we're just too much.
Sean Says: Yeah, and I really like doing things that make me appear to have some form of self-control. This is one of them. I have deleted Twitter off my phone and I added an extension for my web browser that makes it possible to only look at it for five minutes each day. And that way when I have the urge to see something that interests me, I'll go to a news website and not just falling down the stream of screaming people in the dark. Just find some method to ensure that you are limiting the content you're reading because it's easy to get really annoyed by this sort of thing.
Liz: Yeah, absolutely.
Sean: I think that's good mentally, but there are a number of things you can do financially to be prepared for a hardship like this.
Liz: I was thinking about the experience of going into a supermarket store only to find how empty the shelves appear and you realize that it's a little early to start preparing now.
Sean: Mm-hmm.
Liz says: There's a limited amount you can do. If, for example, you've been living from paycheck to pay and then you've got fired, I could suggest you have a three-month emergency fund and you'll be like, "Well, that was extremely helpful." So obviously, in the event that you do have a job, and if you're still working you need to be mindful about spending, you do need to set aside a bit of extra money aside. And we at NerdWallet haven't been big in putting your emergency fund first, as there are plenty of other financial priorities that must be considered which are more crucial in the long run. But we do want you to have at least some kind of emergency fund -- $750, $1000, anything to get you free from the paycheck to paycheck cycle that's extremely easy to fall into. If you've got it good thing, then great. If you're in the position where this is coming just a bit late, we've got some other suggestions for you.
Sean I'm sure that's something I was thinking about as well. A lot of folks realistically are living paycheck to paycheck. They don't have an emergency fund and now is really -- especially when your hours are reduced the time you'll need to draw from that. The thing I'm thinking about right now is I know that a lot of people are likely to use their credit cards. even if you don't have any savings, I believe now could be the perfect time to take advantage of a 0% APR credit card that would potentially provide a cash-flow buffer for the short term. We don't usually recommend taking on the realm of debt, but if you require a bridge to pay for costs right now you might consider this as an option. Just make sure that you make all of your payments in time to ensure your credit is steady and that you plan to get out of that debt before that 0 APR time period expires. Because all of these cards, your APR period will typically be between 12 and 15 months and following that, interest rates may increase to 15% or higher. So just be really aware of this.
Liz Liz: There are alternative options to payday loans. When you search for payday loan alternatives, some of them will be listed and they're things like charities. I'm sure the Jewish [Free Loan Association] is on the market declaring, "Hey, we've got cash for those who need it." There are grants for short-term projects that are possible. Food banks are available. People are who are trying to help in different ways. There are alternative options to taking out a payday loan. Payday loans are a real frightening option.
Sean: Right.
Liz: People borrow the cash and end up in a situation that they aren't able to pay back when payday comes and end in debt, owing in debt, and aren't in a position to get out. If you're considering one of those loans consider looking for alternatives.
Sean The moment is the best moment to take a look at your community and see the resources available. This is the time when a lot of these nonprofits and local community groups are kicking into high gear because they've been preparing for. They're there to support you. But the resources are finite and it can get really difficult when you lose your job, as a lot of people, particularly those in the service industry are experiencing right now. And maybe in a couple of weeks they'll be able to say, "Hey, I can't pay my bills right now." So I'd like to talk about that with you, Liz as this is going to be really hard, it's likely to affect a ton of people. And Liz I'm aware that you wrote an article literally that was titled "How to pay your bills when you Can't Pay Your Bills." What do you think is the best advice for this?
Liz: You have to do triage, which means you have to put the most important items first. That's the most important things. This includes food as well as shelter, the roof over your head, the lights heating, transportation when you have to go to work or you need to get to the doctor or whatever it is. That's the basic things you need to protect regardless of. It's important to remind people that if they fall in arrears with their bills the collectors begin calling them and they panic and they pay whoever is being the most rude. You really need to put your family, put yourself, first and cover the essentials. After that, make a second round of triage for the remainder of your expenses. Which ones are the most severe penalties of not being paid? Which ones have some leeway? For example, student loans, for example, usually have some form of forbearance or deferral that allow the borrower to be able to go on not paying for a while.
Lenders typically have been a lot more responsive in bad times to letting people change their payment plans, delay a payment or something like that however, you must be in contact with them. You have to communicate with them. If you stopped paying, you could have missed some sort of program that could help you and you could have hurt your credit for no good reason.
Sean Hensley: Yes, this can be one of the things that you must complete the work prior to the deadline. However, one thing I've been pleasantly surprised to see in the past week is that lots of the creditors are creating programs to help make sure they are ahead of the curve and they're saying, "Hey, we realize that things are pretty challenging right now. If you're not able to pay your bills, give us a call." But you have to make that call.
Liz: Yes, absolutely. In another podcast, we talk about how you can pay the IRS in the event that you're unable to be able to pay IRS. So, that's the other thing that's coming out that people are grappling with. If you're facing a tax bill that you can't pay, again, there are payment options, so don't hide from looking the options, and it could really assist.
Sean The people they want to work with are looking for their money and want to to work with you and have a good relationship with you. So it takes being proactive, which is yeah, probably the last thing you'd like doing when suffering from a cold and are worried about contracting an illness that is a nightmare. However, it only takes 10 minutes. You can give them a phone call and try to work out the details because the most important thing you don't want to do is go into default, which will ruin your credit score, which could make it more difficult in the future should you need to get another credit line.
Liz: Exactly.
Sean: A different thing I'm interested in this moment is the investments of people. There's been a lot of anxiety around retirement accounts. We've seen the market drop sharply in the last few weeks. I'm wondering what you think people should think about this, and what they should do if they're thinking about taking a complete and total withdrawal.
Liz Tell me what's happening in the stock market? the reason for it being so volatile is because those who are making the trading and the investors look ahead, thinking, "This is going to affect the economy and we don't know how much." And the stock market hates uncertainty , which is why you're seeing it go around the globe. If you are not retiring on the horizon, this is just the same as noise to you. What's happening from day to day, month to month, is irrelevant. What matters is what happens in the long term, over the coming 10 or 20 to 30 years. And we have the ability as human beings and as a country to bounce back. So I think in the long run our future is bright, therefore I'm going to stay invested and I'm going to try not to pay any attention to the noise. If you're planning to retire you're in a different position. Find an unpaid, fiduciary, accredited financial planner. You should have another eye on your retirement plan to make sure that it still makes sense.
Sean Then, yes that's logical. It's another one of those instances that you have to be aware of the food you consume so that you don't fall into a tense condition that leads to pulling out your investments which could be detrimental to you 20, 30 years later.
Liz says: What we observed, and found very interesting was that many people jumped into the market. We had lots of people visiting the site initially when the market fell the first time. I would imagine there were a bunch of people on the sidelines going, "OK, here's my opportunity to buy." And then the floor fell out from underneath them and they're all like, "Agghhhhh." This is a normal part of being an investor. this stuff happens and we've experienced bear markets in the past, we've seen major corrections before. It does bounce back. For the people that are still sitting on the sidelines it's like you're not going to be able to catch it prior to it starts to rise, and when the market is able to rebound and does very quickly, and you'll miss the bulk profits.
Every financial expert who's worth their salt will advise you to stay the course, have an asset allocation plan, ensure that your investments continue to grow and try not to look at them.
Sean: Turn off the news and go through a book.
Liz: Exactly.
Sean: Go ahead and put on some popcorn. All right, great. The last thing I want to mention is the travel plans. A lot of folks don't want to travel right now however, they may have pre-existing plans to go for a trip to Machu Picchu or who knows where. The good news is that lots of airlines are actually making accommodations and removing cancellation charges, however the rules are changing every day it appears. So we actually have a link on our show notes post at nerdwallet.com/podcast to an article that is just regularly updated with different airlines' cancellation policies. So if you've got travel coming up, make sure to check it out and ensure that you are taking an proactive approach to managing any plans that may be in the near future.
Liz The writer: I'm kind of stunned as we've had to live with these horrendous change fees and non-refundable deposits as well as finger shaky and to have all these travel providers acknowledge that fact is awe inspiring and kind of like, hey, at least they're doing it.
Sean Sean: Okay. I believe that's the only thing we can do. For folks that are getting anxious, perhaps a little financially uncertain be assured that you're not alone. However, be aware of the steps you can take to make this tough period a little more bearable. So, let's look at our tips for success. First up, focus on what you are able to control, not what can't. Second, if you can't pay all your bills make sure you pay the essentials: shelter, food and utilities, as well as transportation. Also, during major market volatility like what we're seeing this moment, concentrate on the long term and ignore the day-to-day fluctuations.
And that is all we have for this episode. Are you having a money question of your own? Turn to the nerds and send us a text message or call in to (901) 730-6373, which is (901) 730-NERD. We can also be reached by email at and visit nerdwallet/podcast for more information about this episode. Remember to subscribe, rate and review us whenever you're listening to this podcast.
Liz Here's our brief disclaimer carefully crafted by NerdWallet's legal team. The answers to your questions are provided by highly skilled and knowledgeable writers in the field of finance, but we're not financial and investment advisers. This information is intended to general education and entertainment reasons and may not be applicable to your particular situation.
Sean and Sean said, until next time, turn towards the Nerds.










About the authors: Liz Weston is a columnist for NerdWallet. She is a certified financial planner as well as the author of five money books which include "Your Credit Score."


Sean Pyles is the executive producer and host of NerdWallet's Smart Money podcast. His writing has appeared in The New York Times, USA Today and elsewhere.







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