Financial Resilience for COVID-19 (Part 2)

Financial Resilience during COVID 19 (Part 2)

Meet Jade. She is twenty-six, lives on her own, and struggles to make ends meet working two relatively low-wage jobs: one as a coffee shop barista and another as a beauty store customer consultant.

Two weeks ago, a confirmed case of COVID-19 reached her home state, and suddenly her hours were reduced at both jobs.

Still optimistic, she drove to work each day, always careful when she rung up items for customers. One day, while driving, a distracted driver rear-ended her, propelling her further into financial distress. The driver was uninsured. Jade’s insurance covered the repairs, but she was responsible for a $500 deductible. At the time this came due, Jade had only a couple hundred dollars in her checking account and a nonexistent savings account. Her paydays were just over a week away, and she needed to make her cash stretch, so she put as much as she could—$420 of the $500—on her credit card, bringing the card to its $4,000 limit. Everything will be fine, Jade thought. I’ll be fine. And although she was thinking about the 25 percent interest rate on her card and how, after the last time, she’d sworn she’d never max it out again, she was also thinking about the continuous stream of cases reported on the news. 

With the spread of COVID-19 on the rise, all non-essential businesses were closed, and Jade’s hours at the beauty store were completely cut. Although she got one last paycheck from the beauty store, it was only enough to cover her rent. She still went to work at the coffee shop for to-go orders only, but Jade’s anxiety about her financial situation increased.

A few days later, Jade’s mother turned sixty. The family was worried about gathering together with so many of them during the pandemic and opted out of a party. Weeks ago, Jade had bought her mother a $60 certificate for a manicure and pedicure. Because she couldn’t visit her mother in person and the salon was closed, Jade ordered a nice jar of local honey online and shipped it to her mother to open on her birthday. After this gift, including the cost of shipping, Jade had $60 to last her three days until payday at the coffee shop.

Distracted at work, Jade made the wrong latte for a to-go order, her supervisor watching over her shoulder. She noticed how many customers came in, how many times she touched her face. Jade took deep breaths. On break, she tried to call her mother. That’s when Jade realized her phone wasn’t working. An impatient customer service representative told Jade the problem was an overdue bill and that to restore her service, Jade had to pay $64. She needed her phone, so she gave the rep her debit card info even though she knew she’d incur a $35 overdraft fee.

Anxiety-riddled and tired, Jade returned home to an empty fridge. She still needed to brave the crowds at the grocery store, a task that would have to wait until morning, as the shelves were bare by night. I’m too hungry to sleep, Jade thought, and she used her debit card to order a $10 pizza she knew would end up costing her $45. 

The car accident, this crisis, not seeing Mom, Jade thought, everything is just too much.

The Solution

Jade’s story isn’t unique, as the reality of our world in the midst of COVID-19 is one of emotional struggle and economic strain.

Even before the arrival of COVID-19, 78 percent of American workers live paycheck to paycheck, and because of the timing of pay, they often incur late fees and overdraft charges.[1] Sometimes, they are forced to secure high-cost payday loans just to make ends meet.[2] High-cost credit in particular creates cyclical debt, which makes staying afloat and setting money aside even harder. Emergencies only make matters worse. Sometimes, people can’t bounce back.

Much of this cycle is avoidable. How? By changing the timing of pay.

PayActiv does just this. An employee benefit offered at no cost to employers, PayActiv enables workers to access up to half of their earned wages when they need them. Timely access to earned wages helps employees avoid throwing money away on late fees and overdraft charges. PayActiv’s budgeting tools, financial counseling services, and savings accounts also help employees take control of their money—and plan for their futures. For employees like Jade, PayActiv can be the difference between weathering the storm or drowning in it.

The COVID-19 pandemic has upended our daily routines. Having to struggle paycheck to paycheck—uncertain if you can make it until payday—doesn’t have to be an option. There are far more important things to focus on during this time of global health crisis. PayActiv frees up the timing of your wages as well as the time spent in financial stress so that you can spend that time with your loved ones, take a walk outside, and breathe.


[1] Zack Friedman, “78% of Workers Live Paycheck to Paycheck,” Forbes, January 11, 2019, https://www.forbes.com/sites/zackfriedman/2019/01/11/live-paycheck-to-paycheck-government-shutdown/#3778c8834f10.

[2] Beth Brockland, Thea Garon, Andrew Dunn, Eric Wilson, and Necati Celik, U.S. Financial Health Pulse: 2019 Report, Financial Health Network, 17, https://s3.amazonaws.com/cfsi-innovation-files-2018/wp-content/uploads/2019/12/16161507/2019-Pulse-Report-FINAL_1205.pdf.

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