Trying to pay your bills and manage your finances while unemployed can be incredibly stressful. When you have no income, but the bills keep coming in, it’s easy to feel overwhelmed. However, by carefully budgeting and managing expenses, you’ll be able to stay afloat until you find your next job. Here are some of our tips on how to manage your finances while unemployed.
File for unemployment benefits.
The most important step to take initially if you get laid off is to file for unemployment. You can typically do this on your state’s website. This will ensure that you at least have some money coming in while you’re searching for your next job. It may not be as much as your salary was before, but it’s better than nothing. For some people, they may feel that there is a stigma when it comes to claiming unemployment benefits, but there is no need to be ashamed. People get laid off or furloughed through no fault of their own, and it often has nothing to do with your work ethic or how good at your job you are. Also, filing for unemployment will not show up on your credit report, so don’t worry about it affecting any loans or credit in the future.
Contact your creditors.
If you know you won’t be able to afford the minimum payments on your credit card while you’re unemployed, contact your creditors. Make sure you contact them before you miss a payment. A missed payment can seriously damage your credit score, since payment history is one of the main factors that goes into calculating your score. Your creditors may be able to work out a payment plan with you. For example, they might lower your minimum payment or reduce your interest rates.
Revise your budget.
Another important step to take if you are unemployed is revising your budget. You will probably have to cut some expenses, like going out to eat or getting takeout. Prioritize the necessities, like groceries, medicine, and housing. The rest is all extraneous at this point. Pay the minimums on your credit cards if that’s all you can afford right now. Also, dip into your emergency savings if you have any. This is what your emergency fund is for!
Update your resume and start searching for jobs ASAP.
Chances are, you want to start working again sooner rather than later. It may have been a while since you even looked at your resume, so you should get that up to date. Try to tailor your resume towards the types of jobs you want if possible, focusing on relevant skills from previous jobs. Make sure your LinkedIn profile is up to date as well. Apply for as many jobs as possible, and don’t be afraid to apply for jobs where you don’t meet every single qualification.
Check your options for healthcare coverage.
Unfortunately for many Americans, health insurance is tied to employment. This means for the unemployed, healthcare coverage can be tricky. However, you can still have affordable healthcare even if you’re between jobs. If you were laid off, you may be able to temporarily keep your previous employer’s health insurance through the Consolidated Omnibus Budget Reconciliation Act (COBRA). You can also check to see if you are eligible for Medicaid. Anyone living below the poverty line qualifies for Medicaid.
If you’re struggling to pay off debt, ACCC can help. Sign up for a free credit counseling session with us today!