Payback: Coronavirus Could Impact Those in Debt

If you are in debt, coronavirus might make your bank account sick. As new cases of the virus continue to spread around the country, financial analysts are warning that those with high debt could be in trouble if there's a full-blown outbreak. "This has been a growing crisis in my opinion, that people have just over-borrowed for their vehicles," says Bruce McClary with the National Foundation for Credit Counseling. "And now people are about ready to pay for it, as the economy potentially worsens due to the spreading of the coronavirus."

In particular, McClary warns about the financial consequences if people are forced to miss work, either due to sickness or quarantine. "For about 20-25 percent of Americans working right now, their employers do not pay for time missed on the job," he says.

That loss of income, even temporarily, could be devastating to many people. "The main piece that's missing here is savings," says McClary. "Most people don't have a safety net, they have no personal savings set aside...and when they do have personal savings, it's insufficient to be able to cover them when they have an extended time off of work."

While the coronavirus fears have hit the financial markets pretty hard in recent weeks, the underlying U.S. economy remains strong, with solid job growth and low unemployment. We haven't seen job losses from the virus in the U.S. so far, but some companies like Amazon and Facebook are asking employees to telecommute, or work from home. "If you're healthy now and things are going fine, and if you can go through your budget and find room to save, I'd say do it now," says McClary.

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