Despite improved conditions and the creation of 1.3 million jobs by the end of 2021, many Americans will still be unemployed, according to an analysis by Goldman Sachs. (iStock)

The expanded COVID-19 unemployment benefit helped millions of Americans make ends meet during the pandemic, but analysts noted that some actually made more by staying home than they would have gone to work.

Because of these generous unemployment benefits, many politicians have argued that unemployed Americans have less incentive to return to work. In fact, about half of the states ended additional pandemic unemployment benefits prematurely by June to address a growing labor shortage.

Although unemployment benefits for the 5.3 million Americans ran out in early September, the hiring will only increase by about 1.3 million by the end of 2021, according to an analysis by Goldman Sachs released Oct. 4.

“The current labor shortage reflects a perfect storm of factors that have significantly reduced the supply of labor currently looking for a job, while at the same time labor demand – as measured by job vacancies – has risen to an all-time high.”

– Analysis by Goldman Sachs

Goldman Sachs analysts have made a few suggestions about how the coronavirus pandemic has affected the workforce:

  • Many workers used the pandemic as an opportunity to retire early. There are 1.5 million surplus retirees – that’s about 0.6 percentage points for the labor market.
  • The number of self-employed people rose by over 800,000. Self-employment increased most in the construction sector, where labor shortages are affecting the supply chain.
  • Visas for immigrants and temporary workers fell by around 700,000. Analysts do not expect the pandemic-induced immigration declines to be offset by higher immigration rates in the future.

Yet many Americans are simply unemployed with no excess pandemic unemployment benefits. If you are unemployed and need cash now, there are a few bridging options you should consider, such as:

If you decide to borrow money to make ends meet, visit Credible to compare interest rates on a wide variety of financial products. This ensures that you are getting the most competitive interest rate for your financial situation.

MILLIONS AMERICANS FEAR MISSING DEBT PAYMENTS, NY FED REPORTS: HOW TO MANAGE THEIR DEBT

3 ways to get cash now if you are unemployed

Predatory short-term unemployed loans – such as those offered by payday lenders – can come with high interest rates and impossibly short repayment schedules. Fortunately, there are other loan options for unemployed consumers who need quick online loans. Consider the following:

  1. Research emergency loans
  2. Borrow from your retirement account
  3. Make use of your home’s equity

Read on to learn more about loan options for unemployed borrowers.

SENATE BLOCKS STATUTORY LAW TO SUSPEND DEBT RESTRICTIONS, AVOID GOVERNMENT CLOSURE THAT MAY DELAY SOCIAL SECURITY

1. Research emergency loans

Emergency loans are usually a type of unsecured personal loan offered by a bank, credit union, or online lender. They offer a small lump sum that you pay back over a period of time, usually several months or years.

Personal loans can be a great option when you need cash quickly, as your money can be deposited into your bank account as early as the next business day after loan approval.

Since personal loans are unsecured and do not require collateral, you can use the money however you want. However, if you are unemployed it can be difficult to qualify for this type of cash loan as lenders determine eligibility based on your annual income, creditworthiness, and other financial criteria.

Even if you are currently unemployed, you can qualify for this type of loan if you have a solid credit history and an alternative source of income such as social security, child support, or alimony. But without a steady source of income, you may only qualify for offers with higher interest rates and additional fees. Still, personal loans are a great alternative to high interest credit cards and payday loans.

You can check your credit options with multiple lenders without affecting your credit report on Credible. Once you have an idea of ​​your estimated interest rate, use a personal loan calculator to estimate your monthly payments.

UPDATE OF THE EVOCATION MORATORIUM: WARREN, PROGRESSIVE IMPLEMENT A LAW THAT AIMED TO EXTEND THE BAN

2. Borrow from your retirement account

Another option for emergency cash is to take out a 401 (k) loan. When you borrow from your retirement account, you essentially get a cash advance on your 401 (k) with a low, fixed rate of interest and a flexible repayment schedule.

Since you are borrowing money from your own retirement savings, you are not subject to any credit checks. Because of this, these types of loans are popular with borrowers with poor credit ratings.

However, not all retirement plans allow you to borrow from your 401 (k), and many require that you be employed during the borrowing period. Still, it is a good idea to check with your financial institution to see if you are a suitable borrower.

AOC EXTENDS PANDEMIC UNEMPLOYMENT INSURANCE: WHAT TO DO IF YOU NEED CASH NOW

3. Make use of the equity of your home

Real estate values ​​are at all-time highs and mortgage rates are still around 3%, according to Freddie Mac. These are favorable terms for homeowners looking to tap their home equity with a cash out mortgage refinance.

With a cash-out refinancing, you take out a home loan that is higher than your current mortgage and pocket the difference in cash. Your new mortgage has different repayment terms, such as the interest rate and monthly payment.

A similar way to tap into the equity of your home is to take out a second mortgage in the form of a home equity loan or line of credit (HELOC). These different types of loans allow you to borrow against the value of your home with a new loan but keep your current mortgage.

The main disadvantage of home borrowing is that if you cannot make payments, you risk losing the roof over your head. But borrowing against your home usually allows for lower interest rates and less stringent eligibility criteria compared to unsecured loans such as personal loans.

Contact a skilled loan officer to see if home loans, HELOCs, or cash-out mortgage refinancing can help meet your expenses.

REVOLVING CREDIT BALANCE SHEETS REACH PRE-PANDEMIC LEVEL: HOW TO PAY CREDIT CARD DEBT

Do you have a finance-related question but don’t know who to contact? Send an email to the credible money expert at [email protected] and your question could be answered by Credible in our Money Expert section.