Taking Control of Your Finances During a Loss of Flying
From Your AFA EAP - March 14, 2020
It is prudent for all Flight Attendants to assess their personal financial positions in anticipation of income reductions. While every Flight Attendant’s situation will vary, below are some general considerations that can help you begin strategizing how best to weather the financial impact of flying cutbacks on your household.
Assess your Financial Status.
- Prepare a household budget and cut any non-essential items.
- Prepare a list of all creditors and a contact person. Make minimum payments.
- Place your money in a bank in which you have no debt.
- Attempt to secure a loan early, so you will have a cash flow.
- Assess your tax situation. You may be owed a refund or need to file an extension.
- Be proactive. Assess your credit card debt. Look into a temporary reduction or abatement in payments.
Contact Your Creditors.
You must communicate with your creditors before any payments become delinquent, and the sooner the better. You can negotiate a lower repayment schedule before you run out of money. Be professional, but assertive. Creditors are easier to work with if they know ahead of time that there’s a problem. Also, it shows ‘good faith’ that you are concerned about your debts and intend to pay.
The goal is to make the amount of money you’ve saved last as long as possible. Pay what you can on a regular basis, even if it is less than expected. Partial payments may keep collection agents away. Follow-up all telephone conversations with a letter and keep documentation. Even in the worst-case scenario, it takes a long time for collections, repossessions and evictions to occur. Contact credit counselors who can help you sort out your financial affairs. Be sure to remember to contact the creditors that are automatically payroll deducted.
Even if you can’t pay creditors the amount they want, make your best effort to pay something regularly. This holds arrears as low as possible and lets the creditor know that you are doing all you can. Partial payment may keep your account from being turned over to a collection agency.
Put your payments in order of importance: this will help you pay first things first when money is short. Generally, your most important payment will be the mortgage or rent payment, followed by utilities, health insurance and car payments.
And after the initial contact, it’s important that you keep in contact with creditors – every two weeks or so. This reassures the creditor, shows a responsible attitude toward your obligation and may keep the creditor from ‘hounding’ you.
Prepare a household budget.
A budget helps you see where you spend your money and where you can save. Your budgeted expenses should include:
- Fixed expenses, including: mortgage, rent, taxes, insurance, loans, installment payments, credit card payments and any other monthly payments.
- Monthly expenses, including: food, gas, repairs, dues, recreation, prescriptions.
- Future expenses, including: income/property tax and any other outstanding debts.
Your budgeted income should include:
- Any remaining income
- State disability insurance benefits
- Workers’ compensation checks
- Savings
- Social Security
- Any furlough pay
- Unemployment compensation
- Other pension funds
Your assets may include:
- Cash value of insurance policies
- Equity in your home
- Prepaid burial or funeral policy
- Resale value of vehicles (including boats and snowmobiles)
Now you are ready to adjust your expenses, negotiate with creditors and use assets in the most effective way possible.
Contact AFA’s Employee Assistance Program: 1-800-424-2406
