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Family squabbles over how to spend the 100,000 yen cash benefit.

By on May 22, 2020
A cash relief of 100,000 per household member (regardless of age) is on its way to reach many households in Japan as part of the Japanese government’s response to the coronavirus outbreak. The total amount covering all the members of the family is generally wired to the head of the household’s bank account. According to Yahoo Japan, consultation desks have been flooded with calls amid family squabbles regarding conflicting intentions on the use of the cash benefit.
● Husband, head of the household, wants to keep everything.
● Children want to spend it on themselves.
● Wife looking forward to use the money on shopping.
For many families with higher fixed costs because of children, the past two months have caused physical, emotional and financial strains forcing them to rethink the uncertain future. Many have lost their jobs, some are experiencing a dent on their savings due to prolonged temporary closure of businesses, while those with little to zero back up plan find themselves scrambling for immediate solutions to cover recurring expenses.
The reality is – no financial expert can predict how long this pandemic will last. No one knows for sure what will happen with their jobs and income thus, Prime Minister Abe’s generous stimulus package was designed to help all segments of society affected by the outbreak, foreign residents/business owners included.
In 2009, the government handed out an insignificant amount of stimulus  following the financial crisis after the collapse of US investment bank Lehman Brothers, to spur spending.
However, this time, Japan’s Economic and Fiscal Policy Minister Yasutoshi Nishimura helped adjust and put together a large-scale economic stimulus package matched to the actual damage of coronavirus to the economy. The whole idea of a larger cash benefit is to stimulate the consumption demand.

“It’s crunch time not business as usual,” argue economists. These cash benefits should not be used to make families shop or stimulate spending but are intended for basic survival – paying for rent, food, and necessary utilities as the top priority.

There are a lot of things to consider. What is the best thing to do?
1.  Support small businesses in your community such as local mom and pop stores. Economists say local small businesses have a tendency to pump more of its profits back to the community than large businesses. As a result, the money stays in the community improving lives, creating jobs and them doing the same by buying lunch or grabbing a cup of coffee at a local store.
2. Reduce fixed monthly costs like phone bills, credit card payments, etc. If you’re paying for 3 or 4 mobile phone contracts, cancel 2 so you can hold on to as much cash as possible. According to most financial advisors, families should be stashing away cash to have the equivalent of at least 6 months of your monthly living expenses.
3. Try to negotiate a reduction in rent with your landlord if you had moved before the pandemic. If they refuse, apply for an interest-free no-guarantor-required loan from your municipal office to help you defray the initial costs of moving to a cheaper apartment. The idea here is to reduce your fixed costs and ultimately the stress. Your option: Combine the subsidy with an interest-free loan mentioned in #10 in this article. Initially, only permanent residents qualified. As of the end of April 2020, the policy has changed, now covering foreigners on work visas too. We will cover that in the next article.
4. Actively seek gainful employment to turn things around.
5. Reinvent yourself, polish your skills set and explore other career opportunities that will insulate yourself from prolonged economic downturn.
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