As a self-employed, single parent – and as a crisis manager – I am in general quite relaxed when a situation comes to a head or when things get financially tight. It takes a little while before something frightens me. And if it does, I’ve learned to greet fear as an old friend who reminds me to pay attention rather than stressing me out. Over the last weeks, however, when more and more states imposed a curfew to further stem the spread of the corona virus, I felt a little uneasy. Staying home voluntarily is one thing. But when the state forces me to do so, I find it worrying.
What annoys me most is that a measure is being taken here which, according to several virologists, is nonsense. Walking in the park, you’re unlikely to get a corona infection. But the rate of domestic violence and psychological stress increases massively when you’re locked up at home for weeks – and that’s what it will come down to.
Of course, it is totally advisable to reduce personal contacts as much as possible! And of course we stay inside if possible. For many people, however, this means massive financial losses in addition to a cabin fever. That also frightens many – and rightly so.
Several governments very quickly announced and took measures to help overcome the financial damage. And although these measures are available in principle to all self-employed persons and entrepreneurs, it can be seen that those in power think in large numbers and that smaller companies or solo self-employed persons are given little consideration in their policies. What are the operational costs of a commedienne whose sets are currently cancelled? The freelancers affected first do not need credit lines to maintain their independence. They need money for their private living expenses. Just like the temporary workers in the catering trade, for whom no short-time work allowance will be paid.
A large proportion of the self-employed, who are currently losing their income, are not insured against unemployment. And if they are, having to apply for unemployment benefit feels bad. And then you have to do it even though you did nothing wrong. Demand hasn’t gone down because your performance is poor. It’s because of a government order. And then they do it all for “the big guys”! And you have to deal with it. Go to the job centre. What a load of crap. It’s not fair.
No wonder that the demand for basic income is currently being heard particularly loud. And surely there is hardly a situation in which the idea of a basic income can be so convincingly communicated to a broader section of the population. I must admit, I have two hearts in my chest. On the one hand, I am in favour of a basic income. On the other hand, I’d rather we develop a sustainable concept and discuss it thoroughly and community-wide before introducing it.
What exactly can you do?
So now you are sitting at home and have to cope with the tense situation. Probably your kids are also at home. They get bored and can pick up on your fears. You have to calm them, too. Maybe you’re worried about your parents or friends who work in care or sales. When I’m scared, it helps if I get back into action. Fear has a lot to do with the feeling that I have no control. When we act, the fear also dissolves. So, what can you do to deal with financial fear or worry?
Protect your business
The next few weeks are all about whether your business will survive. Securing liquidity is the top priority. Questions such as compensation or what consequences the interruption will have for your success are a topic for later.
What can you do now?
- Make a cash register drop. What funds do you have available, how long can you cover your costs?
- Reduce costs: What costs can you save if you are currently not producing / selling / performing? Can you get payment deferrals from suppliers? They are probably also in need at the moment, but have an interest in their customers still being around after the crisis. Talk to each other in any case!
- Before you fire employees, remember that you will need them if you continue! Find out if short-time work benefits are an option for your company. Employees who cannot make do with short-time working allowance may be entitled to supplementary benefits. Make yourself smart and help your employees!
- Check out your government’s emergency package. What are they doing to help businesses through the shutdown? Are you eligible? Who is the person or institution you need to talk to?
- Look at your business model to see what you can digitize. Are there ways to generate sales even without direct customer contact?
Make ends meet at home
After you have hopefully ensured your business survival, you might ask yourself: What do you live on privately, if the business is currently not profitable?
- Make a cash register drop. Just like for business, you accumulate all your personal funds. How long can you last? Now is the time you created your emergency fund for.
- Reduce costs. What costs can you reduce? And which ones do you prefer not to, because otherwise you will go crazy if you sit on the butt for 4 weeks? Take advantage of all discounts you might be entitled to (now).
- Speak openly and honestly to your family. What income is left? Who contributes what? Does this change the dynamics in the relationship or family? If you were the main source of income and this is now gone, make it clear to everyone what works and what doesn’t work.
- Investigate ways to raise money. Sell what you’ve been wanting to clean up for ages. Selling stocks might not be a good idea right now, but it might be necessary. Also consider getting a new job for a while. In which industries is the demand for employees currently increasing? If you don’t have any orders anyway, why not dig up the old knowledge from your youth and go help in a store or on a farm?
- Apply for social benefits if necessary. Housing benefit, unemployment benefit, and child benefit allowance have different requirements and contact persons. Don’t hesitate. You want to claim your benefits as long as the administration is not closed down because their staff is sick.
It’s all Mindset!
It’s easy to say, but there’s a lot to it. How we get through a crisis has to do with our attitude towards it. As self-employed people, we’re still in the ranks of the resident population. We are used to taking responsibility, enduring uncertainty and solving problems. Otherwise we would not have become self-employed.
Or so. In many industries there are no permanent jobs at all anymore. There are many people who are not self-employed because they want to be. But because it’s the only way they can do their job. If you’re self-employed, it’s your own fault and shouldn’t cry out for the state, I’ve been reading again these days. That’s easy to say. And of course: No matter for what reason you are self-employed: bearing the entrepreneurial risk is part of it. Anyone who can’t stand it should actually rather reorient themselves. But maybe we should also think about what services and products would no longer be available – or not so cheap – if everyone really did that.
If a situation scares you, it’s okay. That doesn’t mean you should give up. Or that there’s no solution. Fear is a reaction of the body to danger. It mobilises your powers. How you use them is up to you. You can read all the scary news online and ride the fear further and further. Or you can breathe in and out, nodding to the fear: “Thanks for warning me. I’ll take it from here.” And then take on the challenges one step at a time.
Need more help?
In your business, you have it all together, but when it comes to your personal finances, you somehow lose control? You’re successful, but you never feel relaxed about money? Slow months are causing you fear and your friends start telling you to find a job if you can’t handle the stress? The shutdown was the kick you needed to finally face the drama in your personal finances?
We start the next round of our Drama-free Personal Finances course on 06 April. In 6 weeks, we will take a close look at common problems many female entrepreneurs face and how to deal with them. For those who want individual support, a VIP option is available with 1:1 coaching sessions included. And if you want to participate but money is tight, there is currently a Corona Assistance price available for the Basic Option. Check out the Curriculum and join now!
Cover picture: Photo by Aarón Blanco Tejedor on Unsplash