If your budget is tight, even a slight loss of income can be devastating. If you’re faced with an income reduction, whether it’s a loss in overtime or a layoff, you’ll need to make some adjustments to your lifestyle. Things won’t be easy, but the key to surviving such a significant setback is to create a plan and take proactive steps to protect yourself and adjust your financial behavior appropriately. Here are some tips to help you through it.
1. Apply for Unemployment
Apply online at your resident state department of workforce development (WI, MN, IA listed below). You will need personal information along with your work history for the last 18 months.
WI – www.dwd.wisconsin.gov/uiben
MN – www.uimn.org/applicants
IA – www.uiclaims.iwd.iowa.gov/UIInitialClaim
2. Know Your Options for Health Insurance
Contact your HR department to determine options for employer healthcare. Consider insurance on the Affordable Care Act platform.
3. Review Your Budget and Spending Pattern
If you don’t already have a budget, we encourage you to create one and maintain it indefinitely. There’s a variety of free resources online (like this one: budget calculator) that can assist in helping you create a budget from scratch.
Review your bank and credit card statements for recurring periodic fees automatically charged for services that can be eliminated. Examples of this include gym memberships, music and movie services, TV streaming, book clubs and subscription boxes.
If possible, review your auto insurance. There may be a surcharge on your premium for commuter miles that are not occurring at this time.
4. Debts and Mortgages
If you have credit cards, contact the credit company and explain your situation. They may be able to offer some relief on monthly payments.
Contact your bank or financial institution and discuss options for:
• Auto and home equity loans
• Mortgage: if sold to Feddie Mac or Fannie Mae, you could receive up to 12 months in deferred payments
• Student Loans: interest may be waived and you could be eligible to defer payments
5. Beware of Phishing Emails and Money Scams
Turn your scam radar on high-alert. Avoid opening emails, or clicking on attachments or links within emails. Attachments can contain malicious content that can infect your device and steal personal information. Verify the legitimacy of the source before providing any info.
Remember, the IRS will NEVER call you to request bank routing information.
6. Take Care of Yourself!
It’s important to take care both physically and mentally. Try to fit in at least 30 minutes of exercise on a daily basis and maintain a healthy diet if you are able. This is also a great time to fit in hobbies and projects that you may have been putting off. Easier said than done, but maintaining a positive attitude will work wonders. Remember, this situation is temporary.