Losing your job can be extremely painful. It not only affects you personally, but can affect your family and friends as well. With the loss of income comes financial uncertainty…how will you pay the bills, how long will it take to find a new job, have you saved enough in your emergency fund? Even though it may be an emotional time, it must be dealt with immediately to minimize or avoid additional financial crisis and stresses in your life.
So where do you start? The first thing to do is size up what resources you currently have. Find out what benefits or payouts, if any, are available to you from your former employer.
- Severance package or continuing benefits – While employers are not required to offer severance pay, some companies grant it upon termination based on your salary and length of employment, but it can also be a flat figure. You may also receive pay for unused vacation and sick days, and possibly low-cost medical insurance for a limited amount of time. Fully understand the terms of your separation and what conditions you must meet to receive any benefits.
- COBRA (The Consolidated Omnibus Budget Reconciliation Act) - This federal law gives certain employees and their families the right to continue their group health insurance, usually for about 18 to 36 months. While the premiums may be high, it’s a benefit you may want to look into if you held the insurance in the family.
- Career help - Sometimes employers will provide assistance through outplacement and career transition services. If this is the case, take advantage of them! These services could include career counseling, resume development, interview coaching or job-search assistance.
What about unemployment pay? Under certain circumstances severance payments could disqualify you from unemployment benefits, but eligibility varies, so check with your local unemployment office. If you are eligible for unemployment benefits, make sure to apply right away since there can be a waiting period between when you apply and when you receive your first check. Remember though, that unemployment benefits won’t replace your old salary so it is important to not get too comfortable. Update your resume and put together a plan—apply for jobs, go on interviews and network for job leads at least 8 hours every day. Finding a job should be your new full time job! Don’t allow your job loss to make you a couch potato or a daytime TV addict. The key is to find another job as quickly as possible. Your local unemployment office will also have many other resources to help you get back to work.
What financial steps should you take? Take a financial snapshot. You can visit Kohler Credit Union’s MEMBERS Financial Services for a free consultation and financial analysis to help you understand your options and where you stand. Do you have money in savings? A 401(k) or 403(b)? Life insurance? Wondering what consequences you might run into if you open a line of credit or tap into your retirement account? If you don’t know where you and your household stand financially, this is an opportunity to get up to speed. Don’t wait until you’re in too deep to ask for a financial checkup. The earlier you ask, the better the outcome can be.
The most important thing you can do is set priorities for your fixed payments—mortgage or rent, utilities, child-care, health care, etc. By doing this and keeping up with your credit card payments you will avoid paying more in fees and interest. The easiest thing for someone to do is get sucked in by the plastic. Although the use of your credit card may work in the short-term, it will not help you long-term. So in order to protect your existing credit, stay away from charging what you can’t afford.
If you haven’t already created a budget, now’s really the time! You may find that you will need to cut back in some areas of spending. You may be surprised to find out where all of your money’s going. The easiest places to cut cost are eating out, over paying for 400 cable channels you don’t really need, and entertainment costs such as concerts, movies, shopping sprees, etc.
Finally, consider credit counseling. A foundation like the NFCC offers free and low-cost help from a trained, certified counselor who will assist you in determining the best options to meet your individual needs. To locate the nearest CCCS office, call 800.682.9832 or visit nfcc.org.
AddtoAny has their own
policies which may differ from Kohler Credit Union.
Everything changes when a new baby is on the way, including your finances.
When it comes to purchasing gifts for the holidays and spending money within reason, it can be a little tricky…
Off to college? Beginning your career? Budgeting your money can help you stretch your dollars further.
Buying a car, whether a first-time purchase or a brand new experience can seem like a pretty daunting task.
Besides the obvious money savers like not eating out too much or clipping coupons, there are some less painful alternatives to saving money when grocery shopping.
Choosing the right school can be extremely stressful—but how do you find the school you love AND can afford???
What limits are you going to set to keep from going broke this holiday season!?
Budgeting for your new furry family member
When it comes to remodeling, every house has its own story but there are a few general rules of thumb.
Need a Christmas gift that is better than just another candle holder?
Could going green actually benefit you and not the just the environment?
A few reminder how to get back on your feet after a job loss.
Could you benefit from talking to a professional, particularly in today’s economic standings?
WHY NOT embrace the fact that you can handle all of your finances through the internet?
Home equity lending can be a valuable tool for responsible borrowers.
Unless you plan on working until you’re 80, you should think about saving for retirement…well…today!
Some easy to-do’s to help speed up the home selling process.
Marriage is a financial partnership in addition to the tying of your hearts and minds.
How much do your credit card purchases really cost you?
Kohler Credit Union.
