Navigating COVID-19 as a Recent High School Graduate

Navigating COVID-19 as a Recent High School Graduate

The COVID-19 pandemic has affected all aspects of our lives and every age group. High schoolers aren’t immune to the negative impacts the crisis has created. For both college- and career-bound students, we’ve put together some helpful tips that can empower you to make good decisions as you navigate the crisis and prepare for your future.

Protecting Your Credit Health

Responsible use of credit generally translates into a credit score that can open doors for you. A higher credit score can mean getting better rates on loans or auto insurance. It could also be a factor used by a landlord to decide whether to rent to you or not.

To determine your credit score, information is gathered from your credit report issued by three credit reporting agencies. They are Experian, Equifax, and TransUnion. They keep track of payment history and use of credit for all consumers who are issued credit. Payment history makes up more than a third of your score, so paying bills on time is extremely important.

But, what do you do if you’ve lost your job or seen your hours reduced because of the economic impact caused by COVID-19? As soon as you realize you might have difficulty making a payment, contact any company or lender you owe money and let them know about your situation. Especially now, you’ll likely be able to work out some arrangement so that late and missed payments won’t become part of your credit report. A delinquent payment can follow you for seven years and negatively affect your credit score.

You should make a habit of regularly pulling your own credit report and reviewing it for accuracy. Federal regulations require each of the credit bureaus to offer consumers a free copy of their credit report once each year. Be sure to go to the only site federally authorized for these reports, www.AnnualCreditReport.com. Because of the COVID-19 crisis, the three bureaus have agreed to provide consumers with free weekly reports online now through April 2021. You can sign up at www.AnnualCreditReport.com

Credit utilization is the other major factor in determining credit score. The takeaway here: Don’t apply for too much credit all at once. Opening multiple credit cards and taking out an auto loan within a short period of time, for example, is not a good idea for a number of reasons, particularly now with so much economic turmoil.

Make and Stick to a Financial Plan

A financial plan (also known as a budget) puts you in control of your money. To make your plan work, you have to understand the difference between needs and wants. A need is something essential such as food or medicine. A want is something that you could live without, like the latest fashion. 

Even in the best of times, controlling expenses can strengthen your financial health. Now? It’s even more important. There is still uncertainty about how long it will take the economy to recover, so you would be wise to hit the pause button on any unnecessary purchases, like the latest smartphone. You’ll also want to take a close look at what you’ll need for your housing expenses, or consider asking your parents if they’d allow you to continue living at home. 

If you have a credit card or have recently taken out a loan, you’re on the radar of other companies wanting your business. For example, you could start seeing an increase in credit card and auto loan offers touting 0% interest. In this case, it might be good to simply ignore them to avoid getting yourself in a jam down the road.

Graduates Starting Careers

If you’re heading into a career right after graduation, our advice starts with your job search. Using online tools like Monster and Indeed can put you in touch with reputable employers. The Internet, however, can also be a source of scam jobs. Since fraudsters are very opportunistic, they are using this time of COVID-19 to run all kinds of schemes. Always thoroughly research all jobs. If a job sounds too good to be true, it probably is. 

Graduates Heading to College

All of the budgeting advice above holds true for you, with the added component of paying for college. Be sure to research all deadlines, including those for scholarships, Free Application for Federal Student Aid (FAFSA), and tuition payments. Because of COVID-19, some of those deadlines have been extended. Make sure you don’t miss them!

You should also research to see if there is additional institutional funding available to you due to COVID-19. Check in with your college’s financial aid office about funding as well as information regarding refundable payments. What if COVID-19-related circumstances mean you can’t attend school on your original timetable? Can you get refunds on payments you’ve made for deposits, housing, and meal plans? The financial aid office may also be able put you in touch with any work-study programs their school offers. 

Because you’re gathering so much information, be sure to keep organized and document communications with schools. Who did you talk to and when? What was the topic – scholarships, work-study? What are the key deadlines? As you make your plans, remember the most important thing: Be ready for anything. Circumstances surrounding COVID-19 may change at any time.

As you head out on your own, you’ll want to continue adding to your money management toolbox. We have lots of free resources available to you, including an Online Learning Center that covers all the basics from managing credit, to budgeting, to saving for retirement.

The content provided in this publication is for informational purposes only. Nothing stated is to be construed as financial or legal advice. Some products not offered by PSECU. PSECU does not endorse any third parties, including, but not limited to, referenced individuals, companies, organizations, products, blogs, or websites. PSECU does not warrant any advice provided by third parties. PSECU does not guarantee the accuracy or completeness of the information provided by third parties. PSECU recommends that you seek the advice of a qualified financial, tax, legal, or other professional if you have questions.