Tips to Manage Money During Unemployment

It happened. That meeting popped up on the calendar, and your heart sank. You knew what was about to happen. The company is downsizing and struggling to meet its revenue targets. An hour later, you’re packing up your things, the severance package in hand, and heading home. You are unemployed.

If you have found yourself in the land of unemployment, we understand how stressful this can be. And unfortunately, you are not alone. According to the Bureau of Labor Statistics, the unemployment rate rose from January to February 2024. At this point, approximately 6.5 million adults are unemployed in the U.S. That’s a big number.

But it is possible to manage unemployment. So, if you’re wondering what to do when you lose a job, the team at Cash Store wants to make this time a bit easier. Therefore, we have put together some tips to help you master your finances and manage your money during unemployment. 

What To Do Right After You Find Out About Being Fired 

Whether you have been let go due to downsizing or cost-cutting measures, or your employment has been terminated (you’ve been fired) due to poor performance, it’s a distressing time. You’re probably wondering what to do. Should you start applying for a new job right away? Is your resume up to date, and should you update it? Should you pursue more training or education to bolster your skills?

All of those questions are valid. And yes, you should likely do one or all of those things. Yet, when it comes to your finances, there are definitely some dos and don’ts. 

What to Do After Losing Your Job

• Notify creditors or lenders about your job loss. This can open up flexible payment plans for unemployed folks like you.
• Take a close look at your spending. When budgeting when unemployed, distinguish between what's essential and what's not. Ask yourself: What expenses can I delay or skip? What must I pay, like utilities or house payments?
• Update your resume and online profiles right away. It's easier to do this now before life gets busier. And remember that in today’s digital world, your LinkedIn profile is more important than ever. So, don’t forget to update that, too.

What Not to Do After Losing Your Job

• Don't panic. Losing a job is more common than you think. The sooner you start preparing for your financial future and job hunt, the faster you bounce back.
• Avoid buying things you don't need. Yes, it's tempting, but saving your money for necessary expenses is crucial now.

What Kind of Short-Term Loan Options Exist?

On average, it takes about three months to find a new job after you have been laid off. While you may be taking all the steps to cut down on spending and keep your finances in order, we understand that sometimes money can get a bit tight. When this happens, it is super important to continue to pay your minimum payments due on time. If you don’t, it can cause your credit score to plummet by as much as 180 points. And it can take a long time to build your score back up.

When money gets tight, and you've talked to your creditors about flexible payment plans for the unemployed but still feel stretched thin, exploring short-term loan options might be a path to consider. Remember, while unemployment can limit some loan opportunities, having assets or a good credit score can open up alternatives.

Firstly, a payday loan when unemployed might seem like a quick fix, but since you don't have a regular paycheck, many lenders will be hesitant. However, some lenders are more flexible and might consider other sources of income or guarantees. Cash loans are another avenue. Some lenders offer cash loan options with more flexibility for those unemployed, considering other income forms or future employment contracts as part of their criteria.

Then, there are title or installment loan options. These allow you to borrow money against the value of your car. It's a way to access cash when you need it most but understand the terms fully to avoid any unwelcome surprises.

Lastly, selling assets or personal belongings could provide some relief. It's important to approach this carefully and not sell items in a panic. Think about what you can part with that won't compromise your long-term financial stability.

What Else Can You Do to Shorten Unemployment?

Remember that while taking time for self-care and refocusing yourself is important, don’t think of unemployment as a long-term vacation. The key to getting back to work quickly is persistence and perseverance. Here are some tips to help you land a new job and start raking in the dough again.

• Career Fairs: Attend career fairs in your area. They're a great opportunity to meet potential employers face-to-face, learn about different companies, and understand what they're looking for in candidates. Be sure to have copies of your resume for those who want a paper version.
• Websites like Indeed and CareerBuilder: Use job search websites like Indeed and CareerBuilder to find openings. These sites allow you to apply for multiple jobs quickly and easily, broadening your search.
• Update Resume/Use Resume Service: Consider updating your resume or using a professional resume service. A polished resume can significantly improve your chances of standing out.
• Turn to Gig Work: Look into gig or side hustle options to supplement your income. Platforms like Uber, Upwork, or Fiverr can offer flexible earning opportunities while you search for a full-time position.
• Keep Your Head Up: Stay positive and keep your morale high. Job searching can be a marathon, not a sprint. 

Unemployment, Too, Shall Pass

We’ve all been faced with hard times, but it is important to remember that this hard time, too, will eventually pass. That said, we understand what you’re going through. It’s a tough economy and a tough job market. But by following these tips and keeping your head in the game, you will come out better for it on the other side.

If you need a short-term loan for the unemployed, fill out our pre-qualifcation application today. The team at Cash Store is here to help as best we can.

The content on this page provides general consumer information or tips. It is not financial advice or guidance. Each person’s circumstances are unique. The Cash Store may update this information periodically. This information may also include links or references to third-party resources or content. We do not endorse the third-party or guarantee the accuracy of this third-party information. There may be other resources that also serve your needs.