CERB: How to make the most out of it

CERB is saving people from financial ruin, but what is CERB

CERB is a lifeline for many Canadians

CERB or Canada Emergency Response Benefit is a Canadia support system for those who have been adversely affected by Covid-19. CERB may provide Canadians with temporary income support of $500 a week for up to 16 weeks.

As we breathe with relief because the Canadian government is there to help its citizens, many of us are wondering when would we ever go back to normal life and how should we prepare ourselves, emotionally and financially, for that comeback?

In these times of great uncertainty, the next question is: How can I make the best of this help?

We all have different needs and circumstances, but here are a few ideas on how to best use your CERB

Cut spending, focus on the essentials, and pay high-interest debts

Of course, we should prioritize our essential expenses, such as the mortgage, food, internet, phone, and Netflix (yes, in these times when we are forced to stay home Netflix had become an essential expense).

This is a good time to re-evaluate your regular expenses. For example, can you reduce your data plan from your phone now that you may not need it as much? Can you renegotiate your car insurance now that you are driving less?

Then, if you have any high-interest debt, it’s very important to reduce it. This is a perfect time. If you are spending less on going out, buying fewer clothes, and doing less recreational spending in general, this is the time to reduce or even, eliminate your high-interest debt.

Put away some cash

Assuming that your monthly expenses are less than the $2,000 you will be receiving from Canada, this is a great opportunity to put some of that cash away. If you are spending more than $2,000, you should re-evaluate your expenses.

Having some paper money at hand is always reassuring. If you could put together $500 to $1,000 and hide it under your mattress, you would feel so much in control in a world of uncertainty.

If you already have some paper money under your mattress, the next step is to build a 3 to 6-month emergency fund cash in your bank account. Don’t worry about not earning any interest in your bank account, that’s not the purpose of that money. The purpose is to protect you, even if it is just psychologically, against big uncertain times like these.

Make a plan for the rest of the funds

By this time you should not have any CERB left, but in case you do, then continue honing on your priorities, whether it’s to continue to put some money for retirement, traveling when the pandemic is over, paying for self-education or the education of your kids, etc.

This is the time to re-evaluate everything

We are constantly bombarded with psychological triggers to buy this or the other thing. What marketers do is that they highlight our differences and manufacture a desire for us to buy the social symbols that would increase our rankings.

If you think about it, that’s the whole game of the apparel industry, the car industry, and practically any other industry you can imagine.

But in a time when we are all locked down, when we can’t dine in fancy restaurants, we don’t care anymore what kind of car is parked in the garage because the car is going nowhere, we don’t care about the fancy suit or dress because most people are walking around in the yoga pants. Very few of those psychological triggers are working.

This is a time to reflect and admit to ourself, that we never needed to buy and send those signals at all. Maybe, when we go back to normal. We can continue focusing on the things that are important to us and let the others continue being influenced by the marketers.

Related Posts

Connect with me

I would love it if you connect with me via social. You can find me on Facebook, Twitter, LinkedIn, YouTube, and Instagram.