Downsized? Laid off? Those are terms all too familiar to many families during periods of economic turmoil. With companies making staff cutbacks, families face navigating their own financial disasters. Unemployment isn’t the end of the world, however. Here are a few ways to survive unemployment.
Create an Unemployment Budget
If you suddenly find yourself unemployed, draft a temporary budget immediately. This gives you a full overview of your financial status so you can prepare for making ends meet while you’re out of work. List your savings, other income – no matter how small – and all your monthly expenses. Will you receive severance pay? Does your spouse or partner work? Can your spouse pick up extra hours? Figure out exactly what you’re missing for staying afloat.
Look for Freelance or Temporary Work
While many companies are laying off employees, there are also many looking for freelance or temporary help. Contractors aren’t subject to the same rules and guidelines as regular workers, so enterprises avoid paying unemployment tax, providing health insurance coverage, and other overhead costs. Freelancing gets many professionals by between jobs.
Make Sound Investments
Making sound financial decisions, like investing, while you’re employed helps you cope with temporary periods of unemployment. Profits from investments you made years before are often enough for getting your family through difficult times. Online resources, like FI’s Market Minder, are valuable for learning about making smart investment decisions even if you don’t know much about financial markets.
Sell Stuff You Don’t Need
You probably have old electronics lying around that you haven’t used in years. Sell them on eBay, Craigslist, or on other sites like BuyMyTronics.com. If listing them online and shipping them isn’t appealing, sell your used stuff to family and friends or have a yard sale. Clothing, old DVDs, furniture, fish tanks, and plenty of stuff you don’t give a second glance is a great buy for someone else. The small amounts of cash you earn could pay your electric bill for a month or two.
File for Unemployment
Not every laid-off or downsized employee is eligible for unemployment, but it’s one method for earning a percentage of your previous income if you meet eligibility criteria. Regulations and benefits vary by state, but generally if you’re fired for a good reason you don’t qualify. However, if you’ve been laid off or let go for no fault of your own, you’re probably eligible for some unemployment benefits. What you earn through unemployment won’t equal your former paycheck, but it helps pay the bills in the interim.
Make Logical Budget Cutbacks
Enjoying the same luxuries you had while earning a regular paycheck probably isn’t possible when you find yourself unemployed. But unemployment is temporary, so make some temporary sacrifices while you look for a new job. Quit the gym and start jogging, or do yoga at home. Things like dining out, premium cable channels, and other entertainment are easy areas for reducing expenses. Also look at cutting expenses you carried related to your job, like a more expensive mobile plan if you used your personal device for work purposes.
Save Everywhere You Can
Cutting coupons isn’t just for the savings-obsessed. Cutting your grocery bill in half is entirely possible by taking advantage of in-store savings, like double coupons or buy-one-get-one-free sales, and using coupons as much as possible. Sign up for rewards programs at your local grocery store and maximize your savings.
Start a Business
If you’ve dreamed of starting your own business, start digging in now. You can continue looking for a new job in the meantime, but why not take steps towards your dreams while you have the extra time? Technology reduces the barriers to entry for many industries, such as publishing, so accomplishing your goals is probably easier than you think. If your business becomes profitable, you’ve created your own job.
The most important thing when you’re unemployed is staying positive. The world is full of opportunity, and great things often come out of the most unfortunate circumstances. Remember that your situation is temporary, and take action every day towards your goals. Whether you end up launching the next great tech company or you find your dream job next week, there is light at the end of the unemployment tunnel.
Don’t let unemployment get you down or stop you from moving forward. There are plenty of coping mechanisms and strategies for navigating the uncertain path of unemployment. From selling your old electronics and other personal items to taking some freelance work and even starting your dream business, unemployment is often an opportunity in disguise.