COVID-19 brought the world to its knees, or so most people thought. That’s because most of the world is living in the lower or middle class. In reality, COVID-19 created more wealth inequality in America than it has seen in decades.
Early reports are telling a bleak story:
- Two out of every five African American businesses were forced to shutter their doors with little chance of opening them again.
- In contrast, one out of every five white business owners shut their doors.
This racial wealth inequality is seen across the country as protests rage in major cities across America. People are frustrated and starting to speak out.
The Poor Are Getting Poorer
Sadly, racial wealth inequality is not the only problem seen in America. As the pandemic rages on, the poor are getting significantly poorer, while the rich continue to get richer.
Essential workers are often making only minimum wage, which means that they are not eligible for additional unemployment benefits that were distributed during COVID-19 through the CARES Act.
Even with full-time jobs, households are struggling to pay utilities, rent, and other essentials. While many cannot be evicted now, it does not mean that they do not owe back rent, and someday that bill will come due. Many economists are predicting dire economic conditions in 2021, maybe even as early as December 2020.
One Stimulus Is Not Enough To Close the Gap
While government officials speak for, or against, more stimulus checks, many seem to miss one point: they aren’t enough to close the increasing gap of wealth inequality. Households in areas with a high cost of living found that the first stimulus check did little to provide relief for more than one month.
Other households quickly discovered that stimulus checks could barely afford them groceries due to large household size, and a cap on how many dependents were eligible. Although they did help briefly, stimulus checks are not enough to help the poor avoid falling further below the poverty line.
The End of Assistance Is Creating a Future Catastrophe
Many states are receiving assistance from the government. Here are just a few of the assistance options that we have seen across the country:
- Pandemic EBT cards are mailed to children in low-income households.
- Food pantries are giving away food by the ton, and most are not requiring income eligibility at this time.
- Unemployment benefits have been extended.
- Student loan payments have been deferred
- As stated above, evictions have been put on pause.
However, the longer the pandemic continues, the less we see Congress striving to continue to offer a large amount of assistance. Debates in Congress circle around spending too much money to help the people.
And whether you want to watch the news or not, all signs point to this: assistance that many desperately need are coming to a slow end, or possibly an abrupt halt.
As shocking as it may be to many people, assistance could run out long before the pandemic is over.
The Dangers of Financial Unpreparedness
Those that are not financially prepared for this will find themselves without things like utilities or a place to live rather quickly. Electric companies will not hesitate to issue disconnect notices in some areas. Other areas may be lenient, but that is not something that the individual should depend on.
But, it’s about more than just keeping the lights on…Some business sectors will see more layoffs as the year grinds on, and with many folks not having anything in the savings, it is time to get serious.
It is important to take steps now to develop financial security to ensure that you and your loved ones are okay.
Steps To Take Towards Financial Security Now
To develop financial security, it’s important to make sure that you have as much income as possible, and can save as much as possible. While this might be harder than it sounds, it is possible.
Extra Income
If your current income is not enough to become financially stable, it’s time to pick up a side hustle. Sell extra things you don’t need around the house. Pick up a part-time job at a local restaurant if you feel safe doing so.
Online survey sites are another option. People need babysitters, caregivers, cleaners, and most businesses are having a hard time finding people to work. Remote working positions are also on the rise. Remember, every few dollars saved is money you can allocate to a savings account or paying down debt. Trust us, do this now!
Learn Frugal Living Tips
Once you make extra money, don’t rush out to spend it. Instead, save as much as you can. Learning to live by a few frugal tips will help you save more money so that you can build a nice nest egg before the catastrophe mentioned above. You want to be as prepared as possible, which means saving as much money as you possibly can right now.
As wealth inequality continues to grow, it’s important to make sure that you’re ready to deal with a looming financial crisis at your front door. Becoming financially stable, paying off debt, and making sure that you have money put away for things like utilities and rent will help see you through the hard times ahead.
