Piggy bank with bandage and declining coin pile.

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Millions of Americans lost their jobs in the wake of the coronavirus pandemic. Even if you managed to stay employed this year, you may still have had to manage reduced working hours and subsequent income loss. And that, in turn, may have led to unhealthy debt. 

If you've had a hard time financially in 2020, you're probably eager to turn things around in the coming year. Here's how.

1. Get on a strict budget

You may only have limited financial resources at your disposal at the start of 2021, but you can make the most of them by getting yourself on a tight budget. That means only spending money on essentials or reasonable extras, and banking the rest of your income. By "reasonable extras," we're including the $10 a month or so you might pay for a streaming service. When you're stuck home during a pandemic, you need some type of entertainment. But most non-essential spending will need to be cut so you can work toward financial health. 

2. Work on building an emergency fund

Many people who struggled financially in 2020 did so because they didn't have money in a savings account to fall back on. Building an emergency fund will put you in a strong position to handle future financial hiccups without falling into debt. Once you're on a budget, aim to slowly but surely sock cash away in the bank. You may not start out putting away hundreds of dollars a month. But even $10 a month is a good start if your savings account is currently empty. 

3. Come up with a debt payoff plan

If you're carrying debt from 2020, freeing up money to pay it off is only part of the battle. You'll also need to figure out the most efficient way to pay it off. That means paying as little in interest as possible.

If you have a balance on a high-interest credit card, you could try transferring it to a new card with a lower interest rate or, better yet, a 0% introductory rate. Or, you might try taking out a lower-interest personal loan. If you use the funds to pay off your credit card(s), you'd be able to pay that loan back in more affordable installments. 

Borrowing against your home may also be an option. Just as you can take out a personal loan to consolidate and then eliminate debt, so too can you take out a home equity loan or line of credit. As you use your home as collateral, you may qualify even if you have a lower credit score. However, if you fall behind with your payments, you risk losing your home. 

The key is to explore your options and see which one makes your debt the cheapest from an interest rate perspective. 

4. Find yourself a better job

If you're not being given enough working hours or feel you're underpaid, then 2021 could be the right time to seek out a new job -- one that pays you more and helps you dig out of your financial hole. Start by sprucing up your resume so it reflects your most current and important responsibilities, all the while highlighting the skills you'll need to move into the job you want. 

Next, start networking. Tell your friends, neighbors, and family members that you're job-hunting and ask them to keep an ear out. The job market is tough right now, but many companies' budgets do renew at the start of the year. As such, hiring could open up early on in 2021, especially in industries that haven't been impacted or hard-hit by the pandemic. 

The past year may have dealt you a financial blow, but try to keep a positive attitude going into 2021. There are coronavirus vaccines on the horizon and the U.S. unemployment rate has slowly but surely been creeping downward since its April high. It may take work to stage your personal financial recovery, but if you keep at it, there's a good chance you'll close out 2021 on a much stronger note.