My parents just recently received word: After 23 years with the company, my father's employer laid him off in favor of employees with less seniority. With 40-plus years in the coal mining industry, this isn't the first layoff my parents have dealt with but it is certainly hard to take. Considering that I have lived through tough times growing up and tough times in my own adult life, preparing for a financial disaster is something I take seriously. Whether you've just gotten the call, or the letter, or "the talk" and are now wondering what to do, here are some tips for first steps following a layoff or job loss as you try to determine how to keep your head above water and your family taken care of.
Talk to Your Family
First things first, talk to your family about this employment change. Sit down with your spouse or significant other to go over the budget and come up with a strategy. Remember, you are in this situation together and need to rely upon your loved ones to help during this tough time.
Call Your Creditors
Start calling your creditors to find out what programs they have available for job loss. If you have opted in for it, your credit accounts may have insurance to cover a job loss, health issue or the like. In some instances, such insurance may pay off your loan or defer payments for a certain amount of time.
Even if you don't have such credit protection on your account, your creditor may still be willing to work with you to reduce interest rates or payments or even defer some payments. Calling and asking is the best way to find out exactly what options you have.
Take an Inventory of Your Finances
Sit down and look over your current budget, your current balances on all credit accounts and bank accounts. Do you have any savings that you can fall back on? Do you have anything that can be cashed in to cover bills?
Take a hard look at your current budget. Can you cut back or cut out satellite television? Can you cut out Internet service and use free Internet at your local library? Where can you cut to save a few bucks here and there?
Change Your Habits
Start using coupons to save money on food and household items. If you don't know how to use coupons effectively, ask for help from friends and check around for a class in your area. Do Internet searches to find tips for using coupons and saving money.
Reduce electricity expenses by paring down how much you use. Turn off more lights. Close off unused rooms. Hang clothing to dry.
Cut out extraneous spending such as fast food runs, newspaper subscriptions, gym memberships and other unnecessary expenditures. Consolidate shopping trips to save gas and carpool when you can.
Sell What You Can
Eliminate payments or scrape up extra money by selling whatever you can. If you no longer need two vehicles, sell one. "Play" things such as ATV's, campers, motorcycles can bring in extra money to help get you through hard times or such items can be sold to pay off debts. Consider also selling small household items, clothing, toys and the like for small amounts to help build up savings or add funds to the budget.
Swallow Your Pride
Don't be too proud to accept help. If family or friends step in to offer help, don't blow them off just because you don't want to accept help. You might need to accept help from your church or loved ones in order to keep your children fed. When your family is in need is not the right time to be full of stubborn pride. There is not shame in going to a food pantry, applying for assistance or asking for help.
A job loss is never easy but with strategy and determination, you can make it through and survive even the toughest of times.
*Note: This was written by a Yahoo! contributor. Do you have a personal finance story that you'd like to share? Sign up with the Yahoo! Contributor Network to start publishing your own finance articles.
