How and Where to Get COVID-19 Financial Help

If you’re one of the millions of people struggling financially during the COVID-19 pandemic, it’s important to know that help is available. Here is a brief overview of the assistance programs available to struggling Americans.

Financial Help From the Government

Financial Assistance for Individuals

Congress passed several bills to address the financial fallout of the COVID-19 crisis. The first one was the Coronavirus Aid, Relief, and Economic Security Act (CARES), which was passed in March 2020 and signed by President Donald Trump. This law included a direct $1,200 payment for qualifying individuals.

An additional direct stimulus payment of $600 was included in the Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which was signed into law by President Trump in December 2020.

A third stimulus check of $1,400 was authorized for qualifying adults and each of their dependents through the American Rescue Plan Act of 2021, signed into law by President Joe Biden on March 11, 2021.

The act also included an extension of unemployment benefits and a continuance of eviction and foreclosure moratoriums through July 31, 2021. A subsequent order by the CDC extended the July 31, 2021, eviction moratorium to Oct. 3, 2021, but it was struck down by the Supreme Court on Aug. 26, 2021. Foreclosures, though, were not impacted by the latest CDC or Supreme Court actions.

Student Loans

President Biden extended payment deferments on most federal student loans through Dec. 31, 2022. After a federal court blocked the White House's student loan forgiveness program in 2022, the Biden administration extended the pause on payments again. Payments can be deferred until the earlier of:

• 60 days after the student loan forgiveness program is allowed to go forward or the litigation is otherwise resolved
• 60 days after June 30, 2023

Borrowers with student loans still have the option to apply for other forgiveness programs, such as Public Service Loan Forgiveness (PSLF) or the Teach Loan Forgiveness Program.

Financial Assistance for Small Businesses

The U.S. government's initial stimulus package, the CARES Act, contained a provision called the Paycheck Protection Program (PPP). The PPP was reopened on Jan. 11, 2021, and authorized to accept applications until May 31, 2021. The American Rescue Plan Act expanded PPP loan eligibility to several types of nonprofit organizations and added $7.25 billion in funding to the program.

President Biden's stimulus plan also established the Restaurant Revitalization Fund grant program, which was authorized to issue up to $28.6 billion in grants to eligible entities. An additional $15 billion was appropriated to continue financing Economic Injury Disaster Loans (EIDL). Although the application deadlines have passed for both programs, both programs will remain active until the funds are expended.

Financial Help From Your Lenders

Just about every lender—credit card companies, mortgage lenders, student loan servicers, and others—has offered some sort of assistance for their borrowers who have been affected by COVID-19. That may take the form of deferred payments, waived interest and fees, or additional help in qualifying for personal or small business loans.

If you are struggling financially, it’s always better to reach out to your lenders as soon as possible, rather than fall behind on payments without contacting them.

Another option might be taking out a personal loan or small business loan. These should be used primarily as a last resort and only if you have a real belief that your situation will be markedly better before too long. Otherwise, you run the risk of getting into even deeper debt.

Financial Help From Yourself

Instead of (or in addition to) financial help from the government or your lenders, you may have some do-it-yourself options.

One would be a 401(k) loan or hardship withdrawal if you have a significant balance in your account. In general, it's best to avoid touching your 401(k) before retirement, but in a serious financial crisis, it might be your only option.

If you have a Roth IRA (individual retirement account), you cannot withdraw your earnings without paying a penalty. However, you can withdraw your contributions at any time, since you have already paid taxes on them.

For many people, pre-pandemic commuting costs were higher than they are now. One area not given a lot of attention is car insurance. If you drive less, you can likely lower your insurance costs. Contact your auto insurance company and ask what options are available to you.

On a more everyday level, you may also take another look at your spending to see if there's anywhere you could still cut back or any major expense you might put off, at least for the time being.

The Bottom Line

The pandemic has been a difficult time for many and has caused significant financial stress to large parts of the population. Though the country has moved on from the strict lockdowns during the peak of the pandemic, many of the after-effects are still being felt, along with inflation.

The government has implemented many programs for people in need of financial assistance. Loan providers have also helped in one way or another. If you are in need of financial assistance, take the time to explore your options and reduce your financial burden.