Getting laid off from your job is a situation none of us wants to face, but there are strategies you can put into practice to help you get through it until you find work again. Below, is a step-by-step plan that will help you cut your budget to stay afloat after a job layoff.
Step 1. Make a List
The first thing you should do is determine how much your monthly bills cost. Start off by listing the things you can’t change, such as your mortgage payment, rent, car payment, insurance, and the things that are the same each and every month.
Step 2. Create a Bare Bones Budget
Once you’ve figured out what monthly bills are absolutely necessary, and which ones you can cut, you need to make a bare bones budget. A bare bones budget includes only the items that are absolutely necessary for you to pay for every month. If you have debt, this means paying only the minimum payments on your debt if you are able to keep paying at all.
When you lose your job and don’t have much to fall back on, it might be worth a phone call to your creditors to explain the situation and see if they can offer some temporary relief while you get back on your feet. In general, it’s better to communicate with your creditors than to keep them in the dark if you don’t think you’ll be able to pay your minimum payments after a job loss or other catastrophic event. If you don’t call, you might risk damaging your future credit for years to come.
Step 3. Avoid All Unnecessary Purchases
This is rather obvious, but it still needs to be said. After a job loss, you can’t afford anything extra, so don’t put yourself in a situation where you might be tempted. For instance, do you have a friend having one of those home-based parties? Let them know kindly that you simply can’t go right now, but plan to another time if they would invite you again in the future. If they are truly a friend, they will understand. Likewise, you should avoid any girls or guys nights out until you find work, and you will definitely have to let your significant other know that date nights will also be temporarily on hold until you find a job.
Step 4. Consider Part-Time Work
Depending on your emergency fund situation, and what the job prospects are looking like, you might need to consider taking on a part-time job to make ends meet. You might even need to consider employment in a less desirable position to help you make ends meet temporarily while you continue your job search.
Step 5. File for Unemployment
Depending on the reason you lost your job, unemployment is not always an option. However if you do qualify, it might be an alternative that will help you out enough financially to get through this rough spot until you can get another job. Unemployment is a temporary skipping stone to your next job or career-move, and not a permanent place you want to be.
Hopefully this guide helps you stay afloat from the set-back of losing your job. These tips should help you get back on your financial feet quickly when you do find new employment.
Have you ever been laid off or lost your job? How did you deal with the financial implications of job loss?
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