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Job Loss:
The financial challenges of job loss can be overwhelming. Severance (if available) lasts for a few weeks and then there is unemployment (which does not cover much if you have a family). Finding a new job is your number one priority, surviving financially is a very close second.
Job loss is difficult on many fronts, and the stress is second only to the loss of a spouse. Our job defines so much of who we are, and not being able to provide for your family weighs heavy and can be extremely distracting.
At CareerAlley, we focus on what is important in your job search – resumes, cover letters, social networks, recruiters, etc. Still, we also need to help you prepare and position yourself for surviving after your job loss and during your
This post focuses on the most important prerequisites for your
Full of practical, time-tested counsel, this handbook offers simple, useful tips and activities to counter the typically negative reactions to job loss, such as loss of self esteem, and explores thoughts and feelings with the goal of healin
Surviving Job Loss:
There are four things you need to think about to manage your money while out of work:
- What you spend
- Money coming in
- Budgeting
- Available cash sources –
savings , unemployment benefits, 2-1-1 services, renegotiatingdebt , discounts, etc.)
Outflows:
The first step is to make a list of where your money goes . . .
Recurring Bills – This list includes your regular monthly bills (utilities, rent or mortgage, credit card payments, etc.). The best place to start is your checking account statement and any other account where you spend money. If you have any type of savings plan (savings account, 401k, IRA, etc. – see more below on this), these outflows should go on your list as well. For most of us, our biggest outflows are our mortgage and credit card payments. There is also stuff you can do about minimum payments as well as managing your
Discretionary Spend – Next up is a list of your “discretionary” spending. This is either where you spend money (but don’t have to) or where you spend money but can spend it more efficiently. Some examples of discretionary spending include entertainment, eating out, and vacations (there are plenty more). One you probably have not thought about is your grocery bill. While this is not discretionary (because we all have to eat), you can be smart about how you spend your grocery dollars.
Emergency Spend – This category is for unplanned (but necessary) spending. Things like repairing your refrigerator or your car. while you can’t plan for these, you can be sure something will need to be repaired or replaced. You should have a rough idea of how much you spend in any one year and include it as a placeholder.
This clear and simple guide provides tons of practical advice for keeping track of your finances. With useful tips on setting financial goals, reducing debt, finding ways to save money, and creating and following a budget plan, you’ll have your dollars and cents under control in no time.
Inflows:
Next comes a list (small as it might be) of incoming money.
Unemployment: The first thing you must do when you’ve lost your job is sign up for unemployment benefits. This is not a hand-out, you’ve paid your dues when you were working and now it’s time to collect. While the maximum benefit is not all that much, it is more than zero. Sign up and collect. Another benefit of most unemployment programs is training and
Savings Plans: This has two parts: First, as a last resort,
Other Sources of Income: Depending on how dire things are, you may want to consider other ways to make some money in the short term. Keep in mind, that some of these (like a part-time job) will impact your unemployment benefits. There may be some passive income opportunities that do not.
DESIGNED FOR PERSONAL CASH BUDGET - Save time and energy with our color coded cash envelopes, at 7x3" specifically designed for use as a cash budgeting system.
Creating a Budget and Other Important Information:
Your lists from above are what you are going to use for your
Burn Rate: Burn Rate is a term used (especially in start-ups) that calculates the net outflow each month and estimates when you will “run out of cash”. This is a scary concept but you will seriously need to consider and calculate it. You need to live on the smallest amount of money possible during your job search. It won’t be the easiest thing to do, but it will help you last longer financially during your out-of-work period. This should be monitored regularly (more on that when we get to the tools piece) but in no case less than once per month. Putting your various lists together will form your
Interview clothes, meals when traveling or commuting to interviews, etc. Again, try to estimate these expenses as best you can.
Gorilla Tactics: Strange title but appropriate. Another thing you should do as soon as possible is to call your mortgage company and credit card companies. Explain your situation and ask for a modified payment plan that does not impact your credit rating. This will help stem some of the outflows, but keep in mind that you will be paying your balances more slowly and, therefore, increasing the amount of time (and overall cost) of paying down your
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Resources:
One important lesson in life is knowing what you don’t know. While I know quite a bit about
Managing Your Money – Let’s face it, unless you are Bill Gates donating your wealth and time to charities (and there is nothing wrong with that), one of the top three reasons (if not the top reason) you are working is to make money. And your goal? Retire rich as soon as possible. Most of us (like 98%) will never get there.
Your Job Search Journey – Once you’ve read and implemented all of the great information in this article (and trust me, you will feel GREAT when you’ve got your plan locked down), mosey on over to all of the amazing
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Additional Resources
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$24.86Buy on AmazonLayoff. If you haven't experienced one, you know someone who has. Dwain Schenck speaks with authority; not only has he seen energetic, talented, and accomplished friends undergo the stress of job loss, but he, too, has felt the sting of being "let go."
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10/22/2024 01:57 am GMT -
$6.91Buy on AmazonFind practical advice on how to take advantage of your opportunity without regret.
We earn a commission if you click this link and make a purchase at no additional cost to you.
10/22/2024 02:32 am GMT -
$11.95Buy on Amazon Buy on Walmart.com
Full of practical, time-tested counsel, this handbook offers simple, useful tips and activities to counter the typically negative reactions to job loss, such as loss of self esteem, and explores thoughts and feelings with the goal of healin
We earn a commission if you click this link and make a purchase at no additional cost to you.
10/21/2024 05:18 pm GMT -
$10.95Buy on AmazonThis book is about getting one's life in order and moving on after career setbacks. The book shares a number of anecdotes from personal experiences, intending that the book be both instructional and motivational in its tone.
We earn a commission if you click this link and make a purchase at no additional cost to you.
10/21/2024 08:23 pm GMT
