PHOTO: iStock

At CNN Underscored, we know people are hurting financially from the coronavirus pandemic, and we want to help. So we’ve put together this series on how to deal with your money problems in the midst of the worst economy in at least a decade. And since this is an unprecedented crisis, we’re not just offering the same old rote financial advice that you may have heard many times before. We’re sometimes offering unprecedented advice, because when the present looks grim, it’s hard to think about building for the future and more important to focus on fixing things now.

When you’re having trouble making ends meet, there are three basic things you can do: Increase your income, cut costs, or go into debt.

If you’re one of the 33.5 million Americans who filed for unemployment in the last two months, increasing your income isn’t likely an option right now. While expanded unemployment can help keep you afloat for a while if you qualify for it (and if your state government ever gets its act together and sends it to you), you can’t rely on it for the long term.

So if you can’t increase your income at the moment, you have to look to the two remaining options: cutting your expenses or accumulating debt. There are smart ways to do the latter, and we’ll get into those in future installments of this series. But today, we’re going to cover how to lower your expenses in ways that cause the least amount of pain. It can be easier than you think.

Rightsizing your life: Car, house, entertainment

People tend to spend the majority of their money on three main areas: their cars, housing costs, and entertainment. So if you’re going to cut your expenses, you’ll want to look at those three spots first, since that’s where you’re likely to get the most bang for your buck.

Let’s start with your car. If you’re not using it as much as you were before, now that you’re no longer commuting, you may be able to lower your auto insurance costs with one quick phone call. And yes, it really can be quick.

You may be able to lower your auto insurance premiums if your car is sitting unused.
You may be able to lower your auto insurance premiums if your car is sitting unused. PHOTO: iStock

So here’s your first task: Put aside 10 minutes today — not tomorrow, today — to find your auto insurance info (it’s probably in your car’s glove compartment) and call your insurance company or agent. Tell them you’re driving less right now and ask what options are available to lower your premiums.

“Switching from commuting to using [your vehicle] for pleasure can save 5% to 10%,” according to Dan Karr, the CEO of ValChoice, a data analytics company that acts as an insurance industry watchdog.

Some companies will also allow you to change your annual mileage estimates, though they may require a cell phone app or device to be installed in order to measure mileage. But, Karr says, “a reduction from 12,000 miles per year to 3,000 miles per year should yield approximately a 25% savings.”

Also, some insurance companies have been offering rebates on premiums, so while you’re talking to your insurance company or agent, ask if there are any credits or rebates you qualify for. And if a lowered premium is still more than your budget can handle right now, ask for your payments to be deferred, which is an option being offered by some insurance companies.

But be careful, because unlike a rebate, deferring payments means you’ll still owe the money down the line. “Drivers need to make sure they will be able to pay when the payment comes due,” says Karr. “Some insurance companies will increase the price of insurance when there is more than one late payment, so drivers want to make sure they don’t end up in this situation.”

Want to save even more money on your car? Consider making a second phone call to your lender and ask to defer payments on your car loan as well, or even refinance your loan. Since interest rates have plummeted in the last few months, you may be able to get a lower rate than the one you currently have, and also extend the length of the loan at the same time, which will reduce your payments even further.

Let’s be blunt: It’s going to take longer than 10 minutes to refinance your car loan, and you might have trouble qualifying if you don’t currently have an income. So use your first 10 minutes to work on lowering your auto insurance payment, then come back to the car loan when you have more time to explore it (and see how much you can do online first instead of calling, because everyone else is calling).

Cutting your rent or mortgage payments