Unemployment may be near historic lows and companies may be hard-pressed to lure top talent, but that doesn’t mean you are guaranteed to land or keep your job.
Layoffs still happen. It can still take weeks if not months, to find new employment.
If you are among the many trying to stretch their budgets as they seek new employment, fear and stress can be common. Worrying about how you can cover your bills or put food on the table will be top of mind. The good news is that you can get through this transition relatively unscathed. It will call for a few major changes, but there are many ways to survive unemployment. Read on to learn about eight ways to do so.
Tips for Effectively Getting Through a Job Loss
1. Create a Frugal Budget
One of the first things to go out the window when you’re out of work is your lifestyle. Those pricey cups of coffee, weekly movies, and dining out have to be put on hold to cover your bills. But that's not the only way you should cut back. If you are out of work, you have to set an extremely frugal budget.
List all of your outlays and compare that with the money you have coming in, whether it's from unemployment of savings. Identify ways to slash your current bills, in addition to your spending. Take utilities for starters; you may be able to get a lower rate from your existing energy provider or find a lower cost alternative. Even making an effort to shut off lights, use water sparingly, and not overheat or cool the home can save you cash. The same applies to reducing the number of vehicles in the household or getting rid of your vehicle altogether.
Thanks to ride-hailing apps, short term rentals, and vehicle sharing programs, it’s much easier to get from point A to point B without owning a vehicle, paying to park it, and purchasing insurance. Shop your car insurance, homeowners insurance, rental insurance, and medical insurance to see if there are lower cost plans. The same goes for your mobile phone, Internet and streaming services. The more you reduce your bills, the less you will worry about it.
2. Prioritize Your Payments
Your bills are typically at some point in the month, but some are going to matter more than others when you are out of work. You want a roof over your head, a warm place to rest, and food on your plate. Water is another necessity that can’t be ignored. As a result, you should focus on paying those bills first before tackling other debt.
If you think you're going to fall behind on your credit card payments, contact each company and let them know you've lost your job. Some cards have hardship programs for individuals who are going through a personal crisis. The same goes for mortgage companies — if you find yourself out of a job for an extended period of time and you don't think you'll be able to keep up with your payment, don't hesitate to ask your lien holder for assistance.
3. Tap Your Network for Employment
The Internet has brought billions of people closer, presenting opportunities to network and reach employers you couldn’t in the past. These days, it is common for people to work remotely and for some to get hired unseen. If you are out of work, use the Internet to your advantage by networking. The more networking you do, the better chance you'll have to find new employment.
A great place to start is on LinkedIn, the professional social media network. If you don’t have an account, create one. If you haven’t been active, get started today. Join networking groups in your industry and complementary ones. Let your network know you are open to new opportunities and keep your status as "actively looking." That will enable headhunters and recruiters to reach out to you. Share articles and information that is interesting and actionable, and try to establish yourself as an expert in whatever field you are in.
But don’t stop at LinkedIn. Facebook and other social media platforms can also be a great way to find a new job. There are groups within Facebook covering different industries, providing the opportunity to connect and show off your skills. It's now common for employers to post job openings on Facebook and Twitter, so make sure to follow the companies you are hoping to be employed by.
4. Postpone Retirement Savings
It may hurt to postpone retirement savings, but it's not sensible to set aside money for your future when your present bills are suffering. You don’t want to blow off paying a credit card to fund your retirement savings if it means a higher interest rate and even more debt.
If you have automatic contributions set up for a retirement savings plan, put a temporary hold on it until you find employment.
5. Enroll in Unemployment
As soon as you lose your job, head to the unemployment office or fill out your unemployment application online. It doesn't matter if you think you'll be out of work for five minutes or five months, you want to get the ball rolling. Checks aren't issued overnight, and since you really don't know when you'll land your next job, the sooner you can receive payment, the better. Most states provide workers with up to 26 weeks of unemployment benefits, although 10 states provide less than that and one longer. Check with your state to see how long you can collect this benefit.
6. Expand Your Job Search
Instead of looking for a new position strictly in your niche, expand your job search to improve your chances. Many companies look positively on anyone with a bachelor's degree, so start exploring other industries. Make sure your qualifications match the job description you're applying for, even if it's in a different field — management skills are highly transferable — and tailor your resume for each position.
The gig economy has changed the way scores of people work. You may not be able to land a full-time job with benefits right away, but you can supplement your income by driving for a ride-hailing company, delivering packages, or completing tasks for mobile phone users. There are a host of gig economy jobs you can land that won’t interfere with your job search. You get to set the hours your work, creating a way to make some money on the side, while you still focus on landing your next job.
7. Take Any Available Job
If a local retailer or restaurant is hiring, dial them up. If a nearby home improvement center needs a customer service rep, go ahead and apply. Don't wait for your money to run out — check your ego at the door and accept any position you can get your hands on. That doesn’t prevent you from continuing your job search, but it does ensure you have money coming in and that you won’t lose your home or apartment as a result of your unemployment.
8. Earn Money in Other Ways
Instead of wallowing at home on the couch feeling sorry for yourself, use your free time to generate extra income. Fill out Internet surveys for cash, or start selling some of your stuff online. You could even start a small landscaping or sewing business. Assess your skills and parlay them into income any way you can.
Once you come out on the other end of unemployment, you still have work to do. You’ll likely be facing past due bills and payments that are double or triple what you owe. Talk to your creditors about repaying any past due bills, then set up an ongoing budget that includes money going toward an emergency fund. Getting through a job loss is important, but it's even more important to remember the lessons you learned and apply them to future finances. The last thing you want is to face the same challenges if your employment status changes again.
Have you suffered a job loss? What are your tips for getting through it successfully?
Nick Brown is a freelance writer and career counselor. He writes about careers, personal development, and money for several websites and platforms. Nick lives and works in Brooklyn, New York.