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We are happy to have a guest post from financial expert Veronica Baxter from the bankruptcy lawyer industry. This is well worth the read, but if you find yourself pinched for time, look for the section headers to focus on the area that best suits your needs. As solutions vary depending on where you are from, we also advise that you follow up with a financial advisor to ensure you have taken advantage of all possibilities available in your area.


These are unprecedented times. Due to the coronavirus epidemic and attendant government-mandated shut-downs and slow-downs, we have had to find new ways to work and new ways to procure products and services. Unfortunately, many of us have become unemployed, underemployed, ill with COVID-19, or have had to stay home to care for someone with COVID-19.

This article will address strategies and solutions to the financial difficulties you may be experiencing due to the pandemic, from the office of noted Philadelphia bankruptcy attorney David M. Offen, Esq.

Job Loss Due to COVID-19

If your employer has laid you off or has closed due to restrictions imposed because of the pandemic, you are likely eligible for enhanced unemployment benefits.

The CARES Act provided an extra $600 a week for several weeks, and following that, an extra $300 a week, in addition to your state’s unemployment insurance benefits. Take advantage of this program – you paid into it, after all.

Seek Part-Time Work

Just about every state’s unemployment scheme allows for a recipient to work part-time up to a certain amount without a reduction in the weekly benefit. In excess of that, the weekly benefit is reduced. 

You may want to research available part-time work opportunities to supplement your unemployment benefits, even if outside your career field. You can find work online at sites like Indeed, craigslist, and others. Also, ask friends if they know of any work opportunities.

Work from Home Opportunities

There are many virtual jobs available now that social distancing has moved many in-person services online. These include:

      • Virtual receptionist
      • Virtual office assistant
      • Court transcription
      • Medical billing
      • Writing web content

For some positions, all you need is a computer and internet access. For others, some training is required.

Cottage Industries (Etsy, eBay, Shopify, FreeWebStore)

If you have a hobby or craft, consider monetizing it and selling your creations online. There are several low-cost and even no-cost sites that allow you to set up an online store.

Craft a Pandemic Budget

Regardless of whether you are able to supplement your unemployment benefits or not, you must find ways to cut expenses so that your current income covers them. Making sure current income meets or exceeds expenses is the basic tenet of budgeting.

If your income is reduced, you must reduce expenses. The alternative is to charge some expenses to credit cards, and that quickly becomes untenable. Commit to living within your current income.

Make a list of your monthly expenses. Include occasional expenses such as holiday gifts or travel. Add them up. If that number exceeds your current income, you must find ways to pare down your expenses.

Can you get take out twice a week rather than four times a week? Can you turn the heat down a couple of degrees and the AC up a couple of degrees? Can you switch to store brands over name brands?

Many small adjustments in spending add up to a budget that you can afford.

Ways to Save Money During the Financial Crisis

Reduce Transportation Costs

If you are working from home or staying home because you are ill or caring for someone who is ill, you are saving on commuting expenses like fuel and tolls as well as wear-and-tear on your vehicle.

Contact your auto insurance company and ask for a discount because you are driving less. Your insurer should offer you at least 15% off your usual premium.

Subscribe to Have Essentials Delivered

There are many virtual sources for staples of the home, pantry, and personal care that will give you a discount if you subscribe to periodic automatic delivery of items like:

      • Groceries
      • Coffee
      • Wine
      • Liquor
      • Beer
      • Home maintenance
      • Office supplies
      • Pet food and supplies
      • Wild bird seed
      • Vitamins and supplements
      • Prescription medications

If you regularly spend money on any of these, look into it. In addition to the subscription discount, there is often a points-reward program attached, with points redeemable at the same vendor.

Pay the Minimum on Credit Cards

If you have credit cards, try not to use them unless you must, and pay only the minimum if that is all you can afford right now. This will preserve your good credit and prevent the balance from ballooning out of control.

Revisit Your Cable and Internet Plan

Do you really need the most comprehensive cable channel package? Chances are, no. Shop around for packages that meet your family’s specific needs. Do they like to watch sports? Home improvement or nature channels? Classic movies? Poll the family to find out what their viewing priorities are, and find out if you can reduce your cable cost by selecting a different package or subscribing with another provider.

Some cable subscribers are eschewing cable altogether in favor of streaming their favorite programs online. In this case, you can eliminate the cost of cable and pay only for high-speed internet.

Hold Off on Big Projects and Large Financial Expenditures

Now is not the time to spend money on large home improvement projects, or to make large purchases such as real estate or automobiles. In this time of financial flux, be conservative with your spending. Devote yourself to small home projects and wait to make any drastic financial moves until you feel more sure of your financial stability and the health of the economy overall.

Bankruptcy Options

If you’ve relied too much on credit cards to make ends meet, or your family has incurred unreimbursed or uninsured medical expenses, you may be considering filing for bankruptcy. Both credit card debt and medical debt are general unsecured debt that can be discharged in either Chapter 7 or Chapter 13 bankruptcy. Here’s how.

Chapter 7 Bankruptcy

Chapter 7 is a four- to six-month liquidation process by which you disclose all of your income, expenses, assets, and debts, and the court determines that you cannot repay your unsecured debt, so it is discharged – meaning, you are no longer personally responsible for paying it.

When you decide to file, know that only pre-petition debt is discharged. Therefore, if there are no immediate prospects of your financial situation improving, it is still best to wait as long as you can to file because then you will capture more debt and have it discharged in your filing.

Chapter 13 Bankruptcy

Chapter 13 is for people who have a steady income stream, and have either fallen behind on mortgage, car, or support payments, or have incurred unsecured debt they cannot pay and make too much to qualify to file under Chapter 7. You will repay secured creditors, and perhaps unsecured creditors in part, over a three- or five-year repayment plan.

Chapter 13 may be suitable for someone who was out of work for a few months, fell behind on some payments and incurred some unsecured debt, and has a new job that can fund a Chapter 13 plan.

Whether you allow your accounts to go into default or you file bankruptcy to get them discharged, know that your credit score will suffer and that a bankruptcy will remain on your credit report for up to ten years. That being said, bankruptcy can be the answer to getting a fresh start in the COVID-19 economy.


Veronica Baxter, Legal Assistant and Blogger

About the Guest Blog Author

Veronica Baxter is a legal assistant and blogger living and working in the great city of Philadelphia. She frequently works with David Offen, Esq., a busy Philadelphia bankruptcy lawyer.