As someone who recently found herself unexpectedly jobless, this article offers some suggestions to help you “financially survive unemployment”.
With proper planning & budgeting, you can hopefully prepare for even the worst circumstances.
I have learned many things over the years, that have helped me improve upon that tiny bank account I started with my paper route money when I was 11. And, please don’t misunderstand me. I’m not suggesting you stop “living a happy life” or doing things you enjoy just to sock away every penny you have.
I’d like to share some basic things with you that have served me well. Will you be able to do all of these things, every day? Maybe not. You may hit some financial hardships (like being unemployed) but, for the most part… smart spending & planning can help save you if your own pink slip should ever arrive at your desk.
No matter what your situation is, you should be paying closer attention to where your money goes, how you are saving for retirement and looking at everyday items where you can make better money decisions. Quite a few years ago, I read a book by David Bach called Smart Couples Finish Rich. It’s a simple & easy read that can help you get on the right path for your future.
And, if you’re not already unemployed like me, it can help you to better prepare for a future lay off or another life-changing event (although, I’d never wish this on anyone!). I have lived by many of my own principles over the years and now, sitting where I am, waiting for a government check every 2 weeks, I’m thankful that I was living by these “rules”
I’m sure my system won’t work for everyone, and some of these may need to be modified if you are already struggling but hopefully, you’ll find something that will help you (Disclaimer: I am not a trained money professional, and all suggestions are from my own personal experiences)
1) Do NOT buy something you cannot afford. There’s nothing worse than credit card debt. If you have c/c debt, do everything in your power to pay them off. Once they are paid off… don’t use them if you cannot pay the bill, in full, at the end of the month. (Unless of course, you are dealing with interest-free credit cards ..which is a whole other conversation).
2) Be Frugal. Don’t always buy the “best”.. buy the “best value” until you can easily afford the “best” without going into debt.
3) Accept FREEBIES especially when you are just starting out. When I moved into my first place I took every free piece of furniture that was offered to me. I had mismatched rooms and stuff that I would have never picked out for myself (like a pink-flowered sofa) but little by little I was able to replace pieces one at a time with stuff that I loved. This same concept can apply long after you are “starting out”, this way you can get what you NEED now and what you WANT when you can afford it. Use sites like Craigslist & Freecycle to find items in near perfect condition.
4) Do internet research before you buy stuff or use online loan services. You can almost always find the best price or rates on-line.. just do a search for “payday loans near me” and you are all set… You’ll know which payday lender or retail store has the best deal or, you’ll find an online store that sells it cheaper than a local retailer. Once you’ve found your item, google coupons.. you can often find a store coupon and/or a free shipping code.
5) Save money every month.. a liveable amount that you can stick to. Set up direct deposit so that a fixed % of your paycheck goes into a savings account.. and vow to never touch that money. Now, I realize emergencies come up but, make sure it really is an emergency (as you’ve just lost your job or rain is pouring through your roof), not an emergency like.. I saw a fantastic handbag on sale at the mall. (Try to build up an “E-Fund” of 6 months salary)
6) Don’t buy an expensive car. I know this is a touchy one for many people since people “love” their cars. but there are tons of cars that work just fine that don’t cost an arm and a leg. I have owned 2 cars that I’ve driven until they died.. which gave me a few years where I had NO car payments and that’s an awesome feeling (that’s another $300-$400 a month that went into savings)
7) Negotiate with vendors and shop around. Any time you need to have work done don’t accept the first price you are quoted.. you can almost always talk them down. Always comparison shop.. you can leverage one offer against another (and, if you’re unemployed like me.. you have plenty of free time!). Also, many times you can even negotiate with service providers (and this can be done EVERY year)
- We got quotes for our car insurance and then called our company to discuss a lower rate and they knocked off almost $800 yr
- Call your phone company every 6 months or so and ask them if they have any specials or if they can review your phone bill to lower your monthly cost
- Call your cable provider and tell them you’re considering switching to another company… they will most likely find a way to lower your bill. 8) Contribute to a retirement fund. So many people overlook this one! Contribute the most that you can comfortably afford but, always try to max out any employer contributions… Don’t leave money on the table!
9) Sell all that crap laying around your house on eBay. Especially if you are unemployed! You have nothing but time and.. “one man’s trash is another man’s treasure”. It never ceases to amaze me what people will buy on eBay!
10) If you do find yourself unemployed… call all your vendors & monthly bill companies to explain your situation to see if they can adjust your payments/interest etc. Remember these guys want to get paid and many of them will indeed try to work with you!
So… those are the basic tips I hope that at least some of these suggestions can help. It’s certainly not a new concept but the key is, reducing your debt and finding small ways to save more.
Any time you owe someone else $$ (like with credit cards) you’re just throwing money out the window… and the more money you are keeping in your own pocket, the better you’ll be if you find yourself unemployed, on your couch, in your pajamas.