How to Survive Financially during Unemployment and Thrive

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You can survive a layoff or voluntary unemployment and still thrive. Read on for your guide on surviving unemployment financially.

Being unemployed is not ideal, specially when there is no second income to support the household. But, you can use your layoff as an opportunity for bigger things in your career.

What to do after a layoff? and how to survive unemployment? are very common questions after losing a job.

You may be a bit sad or outright panicked during unemployment. But, if you want to make a new beginning, this stage will give you time to restart your work life.

I went thru voluntary unemployment when I stayed home with my kids. It’s a bit different when is voluntary, but unemployment can be challenging no matter how it was caused.

You go from having your days filled by commuting, meetings and tasks to having all the time in the world. So, now you have to come up with a plan to survive this not having a job thing, soon.

Here are some fun things I did when unemployed, before I got busy again. Visited every museum in New York City. I know, museums are not for everyone, but you can pick whatever it is you enjoy doing. Joined the gym and started doing Zumba. Took my kids to the zoo, every week.

I din’t give up on working. I was making plans for a different kind of work, like working at home. But, before getting so busy again, I wanted to enjoy some time off.

Most people getting layoffs don’t know they are going to lose their jobs. Therefore many don’t have a plan to survive unemployment financially. But now all of that has changed and it’s time to make a switch.

How to Survive a Layoff Financially

Surviving unemployment financially is different for everyone. The compensation may be enough to put food on the table, but it may not cover all the rent. Whatever your situation, you do have some options.

Don’t panic. You’ll need to be calm and collected to make the most out of this stage of your work life. This decision was out of your control, you didn’t seek to be unemployed. But, now you have to take control in order to move on.

You have to talk or think about money. The reason why many people find themselves without a financial plan during a hardship is because they don’t like to discuss money.

Money shouldn’t be a taboo subject. It won’t make you happy, but it buys you food, shelter, clothes, medical insurance, peace of mind during hardships, some freedom and fun. During this transition is a perfect time to feel comfortable talking about money.

Read and save this post for resources to survive unemployment. 100+ Financial Assistance Programs Resources for Hardships and Emergency.

1.File for Unemployment Compensation, right away

The sooner you file for unemployment, the faster you’ll start collecting your money. Each State has guidelines for compensation, make sure to go over your state’s requirements.

The Department of Labor has unemployment information for all the states. You can find out about Federal guidelines and States guidelines there.

IMPORTANT: There are new and specific guidelines to cover for compensation for those impacted by the Coronavirus. Read the new guides because they have new flexibilities.

Find out the logistic for filing for unemployment in your state. Many of the states provide online filing, others have a telephone number and physical offices.

2. Get a Health Insurance Plan

The COBRA plan. If your health insurance is tied to your job, the COBRA plan is an option given to you once you’re laid off. This plan is often expensive, so you may want to look at other options.

If you have kids, take a look at Medicaid and CHIPS in your state. These programs have income requirements, but it’s worth trying if you’re unemployed.

The government’s Health Care Market Places. These plans are more affordable than COBRA. they are sold by insurance companies. You can find more information on these at HealthCare.gov.

3. Take a look at your Financial Situation

List all your income. All your cash inflows, for example; unemployment compensation, severance package from work, rental income, passive income and other sources.

This list will help you start to think about other ways to bring in money.

Make a list of all your expenses. This should be on your monthly budget, but if you don’t use one, then you’ll need to track how you spend your money.

You have to do this to see where you can cut expenses from.

And if you don’t budget, here is a way to do a Simple Beginners Budget

Prepare your Finances during a Layoff

Do you have debts? If so review them.

Even if you lost your job, do your best to continue paying your debts. If you don’t, your credit score will suffer and you’ll be stuck paying higher interest rates in the future.

Talk to your creditors and tell them you’re struggling. Let them know you are going to need to negotiate your debt terms.

Do a debt and credit card outstanding balances review. This is something I did before taking voluntary unemployment. This step helped to consolidate my debts and get a lower interest rates, which saved me hundreds per month.

Identify how much debt you have, to whom it is owed, interest rate for each debt. The purpose of this step is to identify which debt can be consolidated and which ones can be negotiated with the creditor. The end goal is to try to save money on interest or to get better terms.

Cut your spending – You have your necessities like, rent, phone, food, medical. Then you have discretionary expenses, those that are nice, but you can survive without. These may be Nextflix, other subscription services, cable, an extra family car. Also, cook most of your meals at home to save money.

Avoid taking on new debt – You are trying to manage your debts down, not up during unemployment. So, avoid new credit cards, personal loans, auto loans. Only take a consolidation loan if it’s to your benefit, lower interest rate and is going to save you money.

Do use your credit card for necessities, if you need to.

Make some Money by Decluttering your place – We all have things in the closets collecting dust. This is a good time to take inventory and declutter. Clean up items for sell, take pictures, put them up on eBay, Craiglist, FB Market.

More Things to Do when Unemployed

Use free career resources. Take advantage of your employers and your state’s unemployment office resources. Usually, after layoffs many companies provide carer counseling services. This is help with your resume and help finding a new job.

State’s unemployment offices also provide many free career services. This include, resume preparation, career counseling and jobs resources.

Enjoy nature – Now that you’ll have more time on your hand, you can go into nature more often. Spending time in nature has been associated with reduction in stress and increase in joy, creativity and gratitude.

Pursue a new hobby – That hobby you’ve been putting off because of lack of time, now you can start enjoying it.

Stay Purposeful – Continue to pursue employment opportunities and attend networking events. Put yourself out there and follow up with job leads.

Be Patient – It’s true that you need to take the initiate for finding employment. However, there are challenges to finding new jobs too. Give yourself time and when things don’t work out, move on.

Use your Computer to find Side Hustles during Unemployment

Side gigs are all over on the internet. These are mainly remote and virtual part-time and full-time job opportunities. From virtual assistance and freelance writers to call centers workers, these gigs provide extra money to pay for expenses.

Pursue off line side hustles too. Baby sitting, dog walking, selling crafts, are a few.

Side hustles can help you diversify your skills set. These new skills can lead to new job opportunities to replace your old income and even to create your own small business.

Stop conforming to the 9 to 5 rule. What do you have to lose?

Side Hustles Related Content:

Get Free Stuff while Unemployed

There are governmental and non-profit organizations that provide free things if you have low income or no income. Being unemployed, you may be eligible for some of those.

Check your State’s Human Services Department to:

Get help paying for rent and utilities
Get Food assistance
Get free health insurance

Losing your job and finding new employment can be a frustrating process. However, there are many things you can control during this time. Keeping an eye on your spending and increasing your income, while you collect unemployment can help you stay afloat.

Remember that this is only a temporary phase in your life. Taking some time to take care of yourself and to improve your skills can not only help you survive, but also thrive during this transition.

IMPORTANT – Watch out for scams. Be careful with companies or individuals offering job opportunities in exchange for payment or personal information.