The first few weeks after getting laid off can be difficult. Don’t be too hard on yourself and take it one day at a time. You still have the skills to find a suitable job or better yet start your own business. The possibilities are endless for you.
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Companies are at times forced to downsize their workforce when they go through tough economic situations. And in a worst-case scenario, you might find yourself on the receiving end of such dismissals. When this happens, the first thing that normally comes to mind is money. “How will I pay the bills?”, “What will I do to survive?”, “How will I support my family?” First of let me just say this, losing a job in the middle of a pandemic is scary and in no way am I downplaying this. The first instinct is to panic, but that will only make the situation seem worse than it is. You need to know there is hope and you can get through this (read that again please).
If you have been laid off recently or just want to plan ahead should it happen to you, then reading this article is a step in the right direction. Here are some tips to help you manage your finances appropriately.
Make a list
Start by making a comprehensive list of all the funds that you have available. It could be some savings, assets or an emergency fund you set aside. The next list is of all debts you have like a car payment, loan, mortgage, and credit cards. For each of the items on the debt list include the due date, minimum payment, and lender’s name. For example, a mobile loan of sh. 30,000 to be paid in full on June 15th. It is important to list them down because it gives you a clear picture of your financial status. You shouldn’t bear the weight alone. If you have a family then let them know. You need all the support you can get.
Create a budget
Once that is done, the next step is creating a budget. The budget is meant to help you spend only what is necessary. When creating one, carefully review the transactions on your bank statement. Then add up your normal expenses and subtract them from any other income available to your household. Adjust your budget according to how much money you currently have. You also need to clearly understand which things are essential. An example is food, rent and other basic needs. Be observant of what you spend your money on and cut out all unnecessary expenses. You need enough funds to get you through some months till you find another job. Only buy what you need, not what you want. In order to survive such times, you need to adapt. This means your lifestyle will have to change but only for a season.
Prioritize your bills
After you have a precise monthly budget, you need to prioritize your pending bills. Look at which ones you can pay in installments to avoid interest payments and late payment penalties. If you have borrowed from friends or relatives then explain your current situation to them. They may offer you an extension on the date of payment or even possibly reduce the interest rates. Granted, they will still want their payment but at least they are now aware it may take longer than expected. The point is you should inform your creditors sooner rather than later so that you are both on the same page.
Get a side hustle
While you manage the money you have, look for part-time work. You can do some freelance work. This will bring in the extra cash flow and add to the savings and pay off some of the debt. Don’t be tempted to get into more debt to cover bills because it will make financial recovery more difficult for you. If you’re passionate about something, go for it. What started as a side hustle could eventually turn into a full-time job. It might take time but the long-term result is worth it.
Save
As much as you are cutting back on spending, you need to set aside some money like an emergency fund. These days you can save money through your phone by creating a savings account. You don’t have to start big. The money can be tight but you work around that by getting a part-time job. Have a small amount that you can deposit on a weekly basis and within six months you will have saved up a good amount of money. Eventually, you can decide to invest the money saved up to make more so that you can increase your income.
Conclusion
Dealing with a decrease in income can be very frustrating, not to mention how the first few weeks after getting laid off can be difficult. It will take hard work and discipline to bounce back. Honestly, it is not going to be easy living without a paycheck but it’s not impossible either. Don’t be too hard on yourself and take it one day at a time. Yes, this may be a setback but keep your spirits up. Change your perspective. Take it as an opportunity to learn and grow. You still have the skills to find a suitable job or better yet start your own business. The possibilities are endless for you. No matter the circumstances, you can make it work.
