LOSING YOUR job does not have to lead to a financial catastrophe. Hopefully, you've been saving for life's unexpected disasters, but if you haven't, here are a few tips to help you cope with the situation.
PRIORITISE
Make a list of what you deem most important to least important, in descending order. The top of your list should entail mort-gage/rent, utility bills, food expenses, school fees (if you have children) and transportation to get to your job interviews. The bottom of your list should entail credit cards, student loans and other unsecured debt. Review your list and see if there is anything at the bottom you can do without, if there is, cut it in order to increase savings. When it is time to pay your bills, refer to this list and be reminded of your priorities, then decide which bill should be paid first. Think about it, missing a credit card payment will mess up your credit a bit, but missing mortgage or rent payments can leave you without a roof over your head.
BUDGET
Construct a new budget and ensure that you cut down on some of your expenses. If you are married, your budget will have to be constructed for getting by on your spouse's salary. It will definitely be to your advantage if you aren't deep in debt. If you are and can manage to continue repaying your debt, do so.
TRACK AND CONSERVE
It is advisable to know your cash flow, what's coming in and going out. This way you'll be able to effectively monitor your spending, and know whether or not it is feasible to go grocery shopping once or twice a month, or if the items you choose can be substituted for another brand at a cheaper cost. You can also conserve by downgrading your car and/or getting a place with a lower rent or mortgage cost.
Leave your retirement fund alone! You may be tempted to dip into these savings, but don't unless it's absolutely necessary. Dipping into this fund will cause you to lose the returns that would be beneficial to you in the end. It isn't advisable to use your retirement fund to pay for credit card bills. Remember, creditors cannot touch your retirement fund. So find another option to slowly repay these bills, until you're once again employed.
MONEY RAISING OPTIONS
Think of all the possible ways you can raise cash. For instance you could rent a room in your house, or sell equipment you do not really use; maybe you have three televisions but only use two, or both a video and a DVD player. Some individuals also opt for garage sales.
Source emergency aids as a last resort. True, this should be an extremely last resort, after all, we all like our independence. However, if you are less prepared for unemployment than others who have been heavily saving, you may need the help of a loan from your parents or another family member, even a good friend, in case of emergencies. However, if this option is used, stick to your promise of repaying this loan as soon as you're hired.
ENJOY OCCASIONAL TREATS
It may take awhile for you to get back on the wagon. In your effort to conserve, track your cash and save, it doesn't mean you have to be miserly all the time. After all, life should still be enjoyed. If the family used to eat out at a restaurant three times a month, you can still go once instead. If you used to go to the salon often, still go occasionally. Just ensure you aren't overdoing it as often as you usually do, considering the present circumstance.
So employ these tips in coping with the situation. Remember, it is always important to have funds tucked away for a rainy day. While you are employed, save monthly, and when you've acquired a substantial amount, invest it. This way you will have more of a chance maintaining your lifestyle if you're suddenly unemployed, or at least be comfortable until you're back on the wagon.
To further discuss investing and the many options we have available, contact DB&G at info@mydbg.com or toll free at 1-888-CALL DBG.
