COMMUNICATED – Losing your job can be one of the most devastating things that happens to you. You might be well-off financially until the news reaches you that your sole source of income has been completely cut. Job loss happens to many people, and it’s a problem that will eventually be resolved sooner or later. The issue comes with having to deal with finances while searching for new employment. Your bills and creditors don’t stop just because you don’t have any money coming in. Surviving job loss financially could mean the difference between staying above the water or filing for bankruptcy.
Contact Creditors
First, you’re going to want to contact your creditors. This includes credit card companies and loan officers. If you have old student loans, now is a good time to consider consolidating them all onto one account. This eliminates frustrating interest fees and confusing monthly bills. Rather than having multiple accounts to pay, you’ll have one convenient, affordable loan that’s less stressful. Your creditors may also be able to work with you temporarily to try to defer payments until you’re able to satisfy balance dues.
Prioritize Bills
Typically, most people have bills that aren’t necessary to everyday life. These bills might include subscription services, cable upgrades or memberships that either aren’t being used or won’t be needed during a financial crisis situation. Now is the time to get rid of these bills and to prioritize what’s a need rather than what’s a want. By doing so, you’ll be reducing what you owe every month, which can add up to an incredible amount of savings until you’re able to secure future employment.
File for Unemployment
Unemployment is a state-provided service to individuals who have lost their jobs. With each paycheck, money is taken and put into unemployment insurance. In the event that you are no longer able to work through no fault of your own, you can apply for and receive benefits. The amount that you will typically get is roughly half of your current salary, but you’ll find that the little bit of funds coming in does help to keep you afloat until you can find something better.
Budget Your Finances Precisely
If you’ve been putting off creating a budget for yourself and your family, it’s about time that one was established. This involves taking all of your expenditures and income into consideration to see where you need to make cuts. If you’re no longer working, you may find that your expenditures cost more than what you’re currently earning. In this case, you’ll want to identify where cuts can be made to lower what you owe.
Avoid the Temptation of New Debt
During a crisis event, like the loss of a job, it can be tempting to apply for loans or to take out credit cards as a way to provide a buffer to your finances until you’re able to secure a new income. Unfortunately, these options are only a temporary solution to a temporary problem. Once you secure a new career, you’ll be left to pay off all of these debts, and you may find that they cause more financial stress than they were worth.
