Have you recently been laid off from work? Dealing with a layoff can be an incredibly stressful time, and much of your anxiety may be related to finances. During a financial emergency like a layoff, you might be asking yourself:
- How will my family and I survive without income during a layoff?
- What financial steps should I take after being laid off from work?
- Are there any tips for dealing with this loss of income?
If you’re being laid off from work (as in, the layoff hasn’t yet happened), these tips can help you feel more prepared if the worst happens.
What is the Meaning of Laid Off?
What’s the meaning of being laid off, or laid off meaning? Usually it means that employers tell employees they have to leave their job because there’s not enough work to do or because of budget or money problems.
You don’t have to feel helpless after a layoff.
Here are 7 key things you can do to feel more in control of your financial situation after you’ve been laid off from work.
#1 – Seek Benefits You’re Entitled To If You’ve Been Laid Off from Work
If you’ve been laid off from work, you may be eligible for unemployment benefits. Immediately visit the unemployment office in your area to begin the process of applying for benefits (your employer may offer information about this step if you’ve been laid off from work). It may take several weeks for the money from unemployment benefits to be processed, so it’s vital that you address this as soon as possible.
For health care, you may be eligible for COBRA health care benefits as well. You may also be able to receive food and toiletries from the local food bank if you’ve been laid off from work. There may be free programs in your area for childcare while you search for a job.
#2 – Got Laid Off? Create a New Budget
If you’ve been laid off from work or have a financial emergency, it’s a priority to review your budget and identify any cuts you could make. Could you stop the following outflows while you’re laid off from work?
- Contributions to retirement or savings accounts
- Tithing or charitable giving
- Discretionary spending categories, like for clothing or books
- Child care expenses
- Subscription services you can live without, like Netflix, Hulu, Amazon Prime, Xbox Live, or Spotify
- Spending on fuel and eating out, since you are no longer working outside the home
- Cell phone plans or landlines
Dave Ramsey, a popular personal finance author, recommends that you worry first about the “four walls” during a financial emergency. That means you take care of paying only the highest priority bills – mortgage or rent, electricity, food, and basic transportation to get you to work.
Since the Internet is such a crucial way to search for a job in today’s world, I’d rank it right up there in necessity with electricity, although you could use the Internet at a local library if you needed to.
My favorite Dave Ramsey books for when you’re struggling with financial problems:
You should be able to find these in your local library if you’ve been laid off from work and don’t want to spend additional money.
#3 – Brainstorm Money Sources
If you’ve been laid off from work, you’ll probably be spending a lot of time seeking a new job. But what will you do in the meantime? It can help put your mind at ease to create a strategy.
List out all of the sources of money you have available to you, including savings accounts and emergency funds. How long do you anticipate the money will last you based on your monthly expenses? Are there any retirement accounts you could take a loan from in a dire situation? (Keep in mind that there may be early withdrawal fees and penalties associated with this strategy.)
It can be helpful to mentally identify any friends and family members who might loan you money in a pinch or offer you housing as a last resort.
Considering all of your options as soon as possible may offer some mental relief from the financial anxiety of not knowing where your next paycheck will be coming from.
#4 – Start Free Side Hustles to Earn Some Income
If you’ve been laid off from work and you’ve never had a side hustle before, now’s the perfect time to start one.
Being laid off from work means you need a way to earn extra income that’s no cost to start. You don’t have the room in your budget.
One way to earn extra income from home for free is to take surveys. The great thing about taking surveys is that you can work as little or as much as you want and it fits great with a busy schedule of interviewing and looking for work.
The way to earn the most money with surveys is to get hooked up with a variety of survey companies. That way you can always have surveys available to do.
Here are some legit survey companies I recommend:
Survey Junkie is totally free to join. And it’s easy and quick to sign up, too.
Once you complete a review on Survey Junkie, you receive points. Once you have at least $10 in points accumulated, you can cash out for Amazon, Paypal, or other e-Gift cards. Even if you don’t qualify for a full survey, you can still get points for your time.
Whether you like online surveys, in-home product testing, or want to participate in focus groups, Survey Junkie’s simple and user friendly interface can help you earn points.
Every task or activity you do on Swagbucks has a point value. Once you accumulate enough points, you can cash out for gift cards for retailers like Walmart or Amazon. You can even get cash payments straight to your Paypal account.
You can get started with Swagbucks by clicking here and signing up.
Here are some other survey companies you can sign up with to make money while you’re laid off from work (just click on each name below to sign up right away)
You can get started today by signing up for one or all of the survey companies above.
- How to Live Frugal: 21 Tips to Master Cheap Living
- 50 Easiest Things to Flip for Profit and Make Money – and Where to Buy Them
- 40 Online Jobs for Students from Home
#5 – Contact Your Billing Companies and Creditors for Unemployment Programs
Once you’ve secured any unemployment benefits you’re entitled to and created a bare bones budget to keep the lights on, call any creditors or bill companies you work with to explain your situation of being laid off from work.
- You may be eligible to defer your student loan payments for a time if you are jobless.
- You may be eligible for certain programs that reduce the cost of utilities for people who are out of work.
- You may be able to negotiate a lower rate or better terms for any loans or credit cards you have.
- You may be able to put medical bills on a lower payment plan or stop payments until you get a new job.
The key to success with this step is to be proactive and let the companies know up front. Don’t wait until you can’t pay the bill after several months and late charges are accruing.
Being proactive and honest about your situation allows time for you to enroll in any special programs for people laid off from work and prevents late fees and adverse consequences for your credit.
#6 – Create a Minimal Meal Plan
Spending money on healthy, nourishing food when you’re laid off may seem like an indulgence. But it’s critical that you eat right to stay healthy. If you’ve been laid off from work, here are a few tips for meal planning:
- Visit the food bank or pick up any food vouchers if you’re eligible.
- Make a list of simple meals without fancy ingredients that you could cook, using food bank items as the centerpiece.
- Create a shopping list and budget meal plan prep list that limits processed foods (since those tend to be more expensive) and focuses on homemade and scratch cooking.
- Try bulk cooking (making large portions or several meals at once) if you don’t normally cook from scratch. That way you can have the convenience of lots of leftovers without the cost.
- If you or your children are used to eating lunch out, pack lunches instead. You could also check with your children’s school to see if they’re eligible for free or reduced lunch based on your job loss.
#7 – Start a No-Spend Challenge
Reducing expenses is a critical part of financially surviving being laid off from work. Although it’s typically a stressful time, there are ways to embrace the challenge of cutting expenses from your everyday budget.
- No-Spend Weekend: 20 Things to Do for No Money
- I Have No Money: Top 6 Tips for a No Spend Money Challenge
If you’re on a tight budget, aiming for “no spend” days can help keep your goals on track. Set a challenge for the number of days you’ll avoid spending. If you’ve never done a no spend challenge before, aim to rack up 15 no spend days in a month.
Put a big red X on the calendar for every day you avoid spending money, from credit to cash. Every day you go without spending money while you’re laid off from work will allow you save and go a day longer until you get your next (hopefully better!) career position.