An unexpected job loss can seem like the end of the world. After all, the next day in itself is a mystery! And when it comes to personal finance, nothing is more devastating than a loss of income. However, it’s not the end of the world but a beginning of a new one, and with a few proactive measures, the unexpected transition from one job to the next can be navigated with minimal consequences.
Don’t Panic, Be Proactive
- Reflect and Make Sure You’re Dealing with the Loss Properly.
Breakups are never easy and a job loss is no different. Whether the loss was because of performance or because it demand, it is still a change in the everyday and deserves to be recognized as significant. It’s important to look at the situation honestly and make sure to learn from it. Take a moment to reflect and write down what you learned from the job and what you took away from job loss. Then, make a list of what you will improve on when going to the next job. This may also be good talking points for your next interview! Also, make sure to turn to family, friends and therapy for support.
- Review Your Monthly Expenses
Your life just hit some turbulence, so make sure that everyone is properly buckled in. This means a) if you believe that you are or are entitled to unemployment, make sure that you apply for that as soon as possible; and b) you need to sit down with pen and paper (or iPad and finger) and have a thorough review of your monthly expenses. This is a good time to figure out what your “needs” and “wants” are. Just a hint: that expensive wine club subscription is a “want.”
- Stop any and all unnecessary automatic deductions.
Predictability is going to be crucial in the transition period between jobs, so it’s important to make sure that you do not forget about any automatic deductions. Some are necessary and may be able to stay. For example, your lights and gas are necessary. Your mortgage or rent may be necessary to keep on an automatic basis. Credit cards minimums however, need to be assessed individually and determined who needs to be in charge of the monthly payment. Never is prioritizing more important than in the wake of a job loss.
Pick Up the Phone
The old saying, “Honesty is the Best Policy” adheres to this sticky situation, too. Before paying another penny to any creditors (that means doing step #3 above!), it’s best to call each and every one. Make a list on Excel or even a piece of paper. Make sure that a representative for each creditor makes a note of the job loss. Determine if it offers any emergency payment plans or a temporary forbearance. Often, credit cards have a small window where it can offer forbearance. It may even waive the interest rates! Of course, results vary, but a creditor is going to have more leeway to work with a current debtor over a delinquent debtor.
Call The Shimotake Law Firm at (312) 934-5886 for More Advice
It’s a tough road ahead but we’re here for you too! If you’ve experienced a job loss, feel free to call us for a free evaluation at (312) 934-5886. We’re here to help!