In Between Jobs? Here Are 3 Tips to Budget Better


Laid off, downsized, corporately restructured out, or even fired – no matter the reason or whatever you call it, being in between jobs is a tough and stressful time for anyone. A part of you is embarrassed. Another part angry. A small part may even be excited for the little break from the wearying monotony of work. But the bulk of you is worried beyond measure about the uncertain future and of course, the financial fright that comes with it.

To help ease that economic distress, here are three tips to budget better during unemployment, and what to do in case of emergencies.

Apply for unemployment benefits

The first thing you need to do is apply for unemployment benefits without any delay. Also referred to as unemployment insurance or compensation, this is a government welfare program where workers who are currently unemployed, through no fault of their own, receive a stipend while they search for a new job.

To receive these benefits, you must register yourself as being unemployed and prove that you’re currently searching for work. While the sum of the benefits is small, it is enough to fetch you your daily necessities so you can focus on your job hunt.

The qualification criteria may vary depending on the state, but typically, you have to be:

  • Completely unemployed or demoted to part-time status,
  • In a position to look for more work,
  • Able to prove that you have worked in the past 12-18 months in order to file for unemployment benefits.

If you negotiated a severance package, then you won’t receive your unemployment benefits until after your last salary. Nevertheless, it’s critical to apply for these benefits at the earliest to get the application process started and out of the way. Once you’ve applied, it would be one less thing to worry about and you can focus on getting your act together. In most states, you have multiple ways to apply for unemployment benefits – online, over the phone, or by mail.

Typically, the process will require a ton of documentation to ascertain your eligibility. As already mentioned, they will check your employment history from the past 12-18 months including gross pay amounts, outside income, and other personal information. Thus, ensure you have everything ready before you apply to expedite the process.

Don’t put it off. You paid your taxes, and your former employer paid for insurance. So, you might as well cash in on every government program you’re qualified to use.

Prioritize your expenses

Payment of certain bills needs to be prioritized over others. Keeping a roof over your head and putting food on the table is obviously more important than, say, paying for Netflix. It doesn’t make sense to pay for something that will put you in danger of being unable to pay for the basic necessities. So, meticulously review all your expenses and establish the most critical ones.

For each impending payment, ask yourself is this a need or a want? While it’s not fun to cut back on things you’re used to, doing so may just save you from getting in dire straits.

Do you really need an expensive gym membership to get/stay in shape? Go for a run outside instead of on a treadmill. Do your weight-lifting at home until you find another full-time gig. If you frequently go out for meals, maybe it’s time to curtail. Perhaps the only perk of eating out is the time saved. But now that you’re out of work, you have time to cook at home. It is significantly more economical and healthier than dining out.

Furthermore, it’s time to clip the cable service and subscriptions such as Netflix and Hulu. Start shopping sensibly rather than impulsively – use coupons and keep an eye out for items on sale. Also, consider changing your thermostat settings to save energy bills, carpool, and reuse/repair items instead of buying new.

All these savings, big or little, will free up money that can go toward necessary expenses such as rent and healthcare.

Negotiate with lenders

Facing trouble keeping up with credit card bills or mortgage? Call your lenders. Don’t hesitate. It may sound strange to you, but it’s in their best interest to assist you in making your payments, even if it translates to a lower interest rate or providing extensions.

People often tend to wait until the situation gets severe enough, but by then it’s maybe too late and lenders aren’t as willing to work with you. If you realize money’s getting tight and you’ll soon fall behind, contact them promptly.

Reaching out to your credit card company can lead to a lower interest rate, and may even result in a temporary suspension in making payments. Contacting your mortgage company may result in a restructuring of your loans without credit check related issues. Moreover, utility companies like gas and electricity ordinarily offer programs to help keep things going and make payments affordable if you’re experiencing financially tough times.

In a nutshell, take action before the warning letters start coming in.

Final thoughts

Above all, it is important to keep your head above the water and not hesitate in asking for help. Don’t bottle up your stress, talk to someone – friends, family, ex-colleagues. Unemployment is something almost everyone goes through at least once in their life, and you never know what opportunities you may find just by talking.

Keep yourself busy – read, write, exercise, freelance, volunteer – whatever floats your boat. An idle mind will work against you. And lastly, when hunting for a new job, don’t settle for something that doesn’t interest you or pays below-par just because you’re in need. Think long-run, and act accordingly. May the force be with you!