5 tips to lessen the shutdown's impact on your wallet

11:11 AM, Oct 11, 2013   |    comments
  • Share
  • Print
  • - A A A +
  • FILED UNDER

WASHINGTON (WUSA9) -- As the federal government shutdown continues, WalletHub has released a list of ways to prevent it from "stinging your wallet too badly."

Here are its 5 Tips for Shutdown-Proofing Your Wallet:

1. Maximize Your Emergency Fund: The Great Recession taught us how important it is to have a financial safety net, even in times of prosperity, and the government shutdown will test how much we've really learned. In other words, it's a good idea for those of us who are not currently affected to cut back on spending and contribute as much as possible to a rainy day fund in order to better withstand market volatility and potentially rising costs moving forward. You may not end up needing it, but if you ultimately do, you'll be glad that you acted proactively.

2. Apply for Additional Credit: It takes a while to
1.get a new credit card, so if you're worried about your cash flow during the government shutdown, now is the time to apply. The beauty of a line of credit is that it doesn't cost you anything unless you use it.

3. Open a Dialogue with Monthly Billers: The government shutdown obviously isn't business as usual, and much like financial institutions were willing to work with customers affected by Hurricane Sandy, many have already announced intentions to be flexible about due dates and finance charges during the unique circumstances we're currently embroiled in. At the very least, it can't hurt to ask.

4. Offset Investment Risk: If you're worried about the fate of your investment portfolio during the shutdown, keep in mind that there are ways to hedge your bets and not only retain your wealth, but perhaps even profit from the turmoil as well. They may include further diversifying your assets, increasing your cash position, or buying stock on weakness in order to garner significant returns if and when depressed sectors ultimately bounce back. But make sure to consult a financial advisor if you have any questions about the best approach for your needs.

5. Fix Variable Rates: It's possible that credit card and loan rates will rise as we near Oct. 17 - the date by which the government must either extend the debt ceiling or default on its loans. As a result, if you have a lot of debt tied up in variable rate loans and lines of credit, it's worth looking into the possibility of consolidating as much of it as possible into fixed rate loans in order to garner debt stability amidst market turmoil.

Most Watched Videos