How to Stay Out of Debt When You are Unemployed

How do you weather the loss of a job and keep yourself going till you get a new one? It may seem very difficult, but if you have prepared for the worst and if you deal with the problem methodically, then you can pass the period of crisis without getting a huge debt burden.

Make a budget

Assessing your own finances should be your starting point. Check on how much money you can afford to spend on a weekly or monthly basis. Next, make a list of required expenses and set a limit on each. You will not be able to maintain the lifestyle you had before, so be sure to leave out the things that you can do without. Add up your mortgage payments or rent, health care bills, tuition fees for your children, food and utility bills and put them down as the highest priority expenses. Once you have made a monthly budget, stick to it religiously, and look for ways to further reduce your spending.

Find part-time or odd jobs

Being unemployed is going to be very hard on you and your family. Swallow your pride and try looking for odd jobs in your neighborhood like mowing lawns, babysitting or caring for pets. You’d be surprised how much you would end up making in a week. You can also find part-time jobs at a supermarket, restaurant, or a retail store. The internet is a great place to find freelance and part-time employment opportunities. You can even set up a small business and keep yourself going for months.

Don’t use your credit card

Avoid paying for expenses with your credit card. If you lapse in a single payment because of inadequate funds, you will be slapped with late fees and interest charges. Even when you don’t use your card, you may have to pay annual or inactivity fees. It’s a good idea to contact your bank and ask them to put your credit card on hold for a while if you can’t afford the fees.

Most of us feel depressed when we lose our livelihood. This is perfectly normal and you can seek counseling to stay positive. Move forward and keep your eye out for suitable job openings but don’t give up if you don’t find one immediately. Remember that this is just a temporary setback and you’ll soon find a way out of it.

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