With unemployment figures hitting a 16 year high in the US, fuelled by the worst economic crisis since the Great Depression of the 1930s, there are now more than 10 million Americans out of work and it doesn’t look like it is going to get any better.
If you have just been laid off or lost your job through no fault of your own, then file immediately for unemployment insurance. Your state’s Department of Labor and Workforce Development Agency will be able to advise you to the nearest Unemployment Insurer’s office.
The next thing to do is to sort out your finances immediately. Never wait until things get that bad that you are facing eviction or the bailiffs. By prioritizing your outgoings, you will be able to sort out a financial schedule that will allow you to be both flexible and frugal.
Look after the money that you have already. Tell yourself that those few dollars that you keep in the bank, may get you out of a difficult financial spot at a later date, so try not to make yourself feel better about your predicament by splurging the rest of your cash on non essential items.
Managing day to day debt will hinge a lot on how you control your monthly outgoings. The best thing to do is to sit down with the whole family and have a crisis meeting. Include the children too, because anything you decide will affect them also.
Depending on how drastic the situation is, and how confident you are in finding new employment, will dictate to how much you prune down your outgoings. Before you contemplate selling the house as a last resort, you may be surprised how much money you can save each month by simply keeping an eye on your outgoings.
Initially you can take your bank statement and look at what you pay out already. Can you change your life insurance policies and get cheaper elsewhere? Cut the television package to its barest minimum. Energy suppliers offer very competitive rates at the moment so it may be well worth switching providers to get a better deal.
How many charity donations do you make by direct debit each month? What about house, content insurance and car insurance? Do you have a regular pension or savings plan? Contact your bank and ask them whether you can change the amount you pay and cancel the savings plan.
Manage your bank account and other facilities online. This way you can keep a track on what you have spent and will be able to keep up to date with bill payments. Being organized is also the key to good financial management.
Do you have a mobile phone package? Depending on how long you have been on the plan, some providers will allow you to change to a cheaper plan or even convert to Pay as you Go. Give them a ring and explain your situation. Tell them that you are worried about having to pay the next bill and see what they can come up with for you.
Now you no longer have a job do you really need the car? If you are a two car family then perhaps it may be wiser to negotiate terms for sharing just the one. For short journeys you could even start riding a bicycle – a healthier option for the environment too.
The Internet is a great place to pick up a bargain, so before you commit yourself to handing over your dollars, check on the web to see if you can get the same item any cheaper. Keep your eyes open for sales, and bear it in mind that supermarkets offer great deals such as “buy one get one free” and “two for three offers” If you are on a shopping spree, use the calculator application on your mobile phone to add up the total, so that you can keep track on how much you are spending.
Prioritize your needs. Pay for what is important first, such as the rent or mortgage, rates and heating and cooking. At least if you have nothing else, you will still have a roof over your head and a warm environment.
If you start getting into trouble with bills, and find that you are unable to keep up to date with payments, ask for help immediately. Contact the people you owe money to, and explain your situation. It is much better to negotiate lower terms at the beginning of your money troubles rather than let your debts ride, incurring non-payment charges and possibly higher rates of interest.
Leave your credit card at home or just use it for emergencies. It will deter you from buying things on impulse or purchasing something unnecessary that you can do without.
Use your debit card instead of taking cash out. This way you can track where your money gets spent and any spare cash stays in your account. Avoid taking out large cash sums and saying to yourself “This will have to last me until so and so” It is better to leave your cash where it is and use it only when you need it. Tell yourself “if I haven’t got it, then I can’t spend it!”
Economize by making home prepared meals and take advantage of the shop’s cheaper own brand products. The Internet is a great place to find tasty, low cost healthy eating recipes.
Try to find a hobby or interest that is going to be fairly cheap to run or join. If you have a game console then swap games with friends and sell them when you have finished with them.
Be interested in what others are doing, and you may learn a few extra skills, such as, helping your Dad plumb the washing machine or repair that old wall at the bottom of the garden. Each new that skill you acquire, equals money in the bank, because you haven’t had to hire an expert to do it for you.
Board games such as Trivial Pursuit, Scrabble and Monopoly, can inject a little fun into the situation and compensate for having to give up those expensive trips to the cinema or theme park.
Sell unwanted gear on eBay or Amazon. Both forums are very user friendly, and an account takes very little time to set up. Although the idea may seem a little daunting at first, you will be glad you made the extra effort when the cents come rolling in!
Recycle you old or unwanted articles. For example, instead of throwing those old shirts away, why not cut them up and make dishcloths from them? If you are getting rid of a worn sheet, then don’t waste the fabric. You can use the good material (the bit that usually gets tucked in) to make pillowcases and ironing board covers. Old sweaters can be unwound and the wool re knitted into a new garment. Before you throw anything away take a good look at it and figure out how it can be adapted to reuse as something else.
Gardening is a fantastic past time, and takes very little money to keep ticking over. Vegetables and fruit are a great way to supplement your diet with those essential vitamins and minerals, and producing your own home grown food can give you an amazing sense of pride and achievement.
Why not ask if someone needs some decorating doing or a messy garden sorted out? Baby sitting can bring in a few extra cents too and dog walking can be a fairly profitable pastime. Not only will you be generating a few hard earned dollars, you will also be getting some exercise and you could get the family to help out.
If you are a smoker, then a hefty amount of your weekly budget is going up in smoke. You may decide that this is the right time and a good reason, to finally quit the cancer sticks.
Losing your job with fill you will an immediate sense of devastation and you will worry about what you are going to do next. By taking a firm grip of the family purse strings and sorting out the important details in life before they turn into real issues, you will have taken one big step forward into regaining the control over your life that you lost when your job finished.
Tell yourself that as one door closes, another one will open, and who knows where you will be this time next year…