5 Ways to Handle Debt When Laid Off

Getting laid off can be a shock for anyone. Sometimes they come as a surprise and on some occasions layoffs are expected. When you’re presented with a layoff, you may feel that your life is crumbling before your eyes. With no job and debt, how will you pay your bills?

The thought of having no job and debt can keep even the most financially stable person up at night. It’s every ones worst nightmare. So if you’re not going into unemployment with a large amount of savings then how do you handle debt while laid off? There’s no simple answer to this question and every situation is unique but here are five tips to help you handle debt when laid off from your job.

Know what funds you have available

Make a list of all of the monetary assets that you have. You should know exactly the amount of money you have in your checking and savings account. As for credit cards, know your available credit. If you have any investments or retirement accounts, you should know the cash value for those as well. Desperate times call for desperate measures and you will probably need these funds in order to get by.

Prioritize your expenses

You always want to pay secured debt first. Secured debt means that the asset can be claimed by the lender if the borrower falls short of payments. Examples of secured debt are your house and car. Your mortgage, utilities and food expenses should be the first expenses that you pay before anything else.

It may get frustrating getting creditor calls from your credit card companies but credit bills are the last thing that you pay in these kind of situation. So don’t be pressured to pay the bill unless you can afford it. Also, don’t allow creditors to harass you. Know your rights and find out what laws in your area protect you from creditor harassment.

5 ways to handle debt when laid offSeverance package

When laid off ask your employer about a severance package. Severance package are pay and benefits given to an employee when they have been laid off. The amount given is based on the length of employment. It can include a payment for unused sick and vacation days. Severance pay should be rationed towards your bills until you find new employment.

Contact creditors

Call each creditor and make them aware of your situation. Let them know that you have been laid off. Most credit card companies will be willing to work with you due to the simple fact that they want their money. In most cases there is a good chance that you will be able to negotiate a payment plan. Also, ask your bank about a hardship plan or forbearance program. These programs can involve lowering minimum payment, temporarily lowering the interest rate, or the cancellation of late fees and penalties.

Get a job

It’s important to get a job as soon as possible. When you’ve been laid off and you have debt, you are not in a position to be choosy about where you work. It’s important to get a job, any job. Of course you would like to do something related to your experience and your training but you must face the fact that you may not got the job you desire. Finding a job takes time and patience, so if you know of any places that are hiring immediately, just take it.

If you can’t find a job, then get creative and find ways to make money. Sale your car or rent out a room in your house. If you have a skill start contracting out work as a way to supplement income. Start a business from home using resources that you already have.

In conclusion, unemployment doesn’t have to ruin your finances. Although, being laid off from a job can be one of the hardest times of your life, good money management skills and determination can help you manage your debt effectively.

Romona Bradham is the owner of Monasez.com, a lifestyle blog which helps young adults achieve their finance, career, and life goals. You can contact Romona at info@monasez.com, twitter, and google+.

Embrace Abundance

One of the tried and true tenets of personal finance is frugality.  Either through penny-pinching and coupon clipping, or through budgets and smart spending, we aim for frugality.  We choose to be frugal either because we have high debt loads, or because we just want to save some money for some purchase.  In short, we’re reacting to a scarcity of some resource.  In the case of many of us, that resource is money.

Through scarcity, we find ways to make things last longer, or stretch further.  We find ways to turn something raw into something useful.  Scarcity teaches us to be resourceful; not only with our money, but with our food, clothing, supplies, our whole world.

But, sometimes we get so wrapped up in embracing scarcity, and learning from it, that we forget to also embrace abundance.

Sometimes we even participate in abundance, but only because we claim that it’s the scarcity that’s the driving force of our action.

Today, forget scarcity.  Embrace abundance.

Embrace Abundance

Just for a day.  (I think you’ll want to do so longer, but start with a day.)

Embrace the things in your life that are abundant.  Embrace the abundant opportunity to partake in the last few days of summer and go to the park.  Swing.  Play with your children.  Or pets.  Or friends.

Embrace the abundant knowledge that you have in your local library, or through services like PaperbackSwap, and learn something.  Read a book. (Even if it’s strictly for pleasure.)

Embrace the abundant joy that you have in your family.  Break out the cards or board games and enjoy their company.  (Even the one who’s ruthless at Monopoly. )

It doesn’t matter what it is.  But, don’t do it because of scarcity.  Do it because there’s something in abundance that you want to enjoy.

What do you have in your life that is overflowing in abundance?  Embrace it.

14 Money Rules For Success in Your 20s

The following is a guest post from Martin of Studenomics and now Kettlebell Rebels, where he has released the ultimate kickstarter course.

Are you looking to succeed with your money in your 20s?

I know, times are tough and you have no clue what’s going on. You get paid and you want to go out. That’s cool. The problem lies in spending your WHOLE paycheck. While money management talk can often be boring, I wanted to share some easy tips with you to get ahead with your finances.

I hate strict rules. I hate telling you what to do.

I do however really want to share 14 money rules for getting ahead in your 20s.

What are these 14 financial rules to keep in mind?

14 Money Rules for Success in your 20s

1. Look for ways to make money.

There are many ways to make money out there. I suggest that you always keep your eyes open for the next opportunity. It could be a weekend gig, a freelancing business, or even a promotion within your company. Always try to increase your income.

2. Find ways to save money creatively.

Saving money doesn’t have to be boring. You can be creative with it. I recommend that you find ways to have fun with saving money.

For us it’s simple. We try to see how long we can prepare our own food or go out and not spend any money. Making your own food and saving money can get fun, especially when all you have left is beans and tuna.

3. Stop buying drinks for girls.

Stop this nasty habit. Save your money.

While you’re at it, try to go out sober. I guarantee you that it becomes more fun after a few times.

4. Go out on the cheap.

As mentioned earlier, you should try to go out on the cheap. I know that you’re not going to stay in just because some financial blogger dude told you to. I get that. Can you try saving money when you go out though?

5. Take the bus for as long as you can.

I know that the bus can be annoying at times, but you can save some serious coin if you take the bus for as long as possible. I took the bus an hour each way when I was in school. I got my best studying done on it and I saved money.

Once you get a car the expenses go through the roof (maintenance, gas, parking, and car payments). This is can really take a huge chunk of your paycheck. Don’t let it happen.

6. Hang out with friends that share similar views on money.

If you want to be frugal, you really need to surround yourself with frugal people. It’s difficult to save money if your friends want to go out all of the time and spend money.

I’m sure your parents already told you this. You are who you hang out with.

7. Don’t embarrass yourself to be cheap.

You also have to try not to make a fool out of yourself. Saving money is cool. Don’t be weird about it.

For example, don’t miss your best friend’s birthday to save money. That’s inexcusable.

8. Accept that you won’t be ready for every opportunity.

When it comes to grabbing hold of chances that come your way and moving forward, it’s okay to not be ready. You’ll never be fully prepared for everything. You just have to go.

Earlier this year I signed up for a 10k run. The only problem was that I never ran before! It was humbling, but I managed to complete it in under an hour and not die.

You won’t always be ready. That’s cool.

9. Watch how you use that credit card.

I personally support student credit cards. I also sadly have seen many friends get into insane amounts of debt because of a piece of plastic.

I’m not your parent and I’m sure you’ve been lectured on this. So, just please try to watch how you use your credit card.

10. Never spend money to use your money.

Banks will try to rip you off. Don’t let them. It’s your money and you shouldn’t be charged to access it.

I recommend finding a free checking account to save more of your money. It only takes a few minutes to switch.

11. Don’t buy just because someone tells you to.

Buying a home should be the biggest decision you make in your 20s (aside from getting married). You should treat it as such. Don’t buy a house just because someone tells you to.

Just this past week, a friend of mine bought a home because he heard it was a good time in the market. I doubt that he’s ready for it, but he’s now a home owner!

12. Don’t move in with the next person you kiss.

You don’t have to be single forever like me, but you also shouldn’t move in with the next person who looks your way.

Where’s this coming from? I helped a buddy move last March. He moved in with someone he met in January. By October he was out. He lost his deposit, the money he spent on furniture, and it ruined him emotionally for months.

Please try to stay calm with your relationships!

13. Rent as long as you can.

There’s nothing wrong with renting. Don’t let your buddy who works as a real estate agent convince you to buy. Keep on renting and saving money.

14. Pay your parents back.

Please pay your parents back somehow.

They worked hard forever just to support you, feed you, and make sure you stayed out of jail. Now let them relax.

A few years ago when I graduated, I bought my parents a trip to the Bahamas. They always wanted to go and I sent them away right before Christmas. They were tanned and relaxed for the holidays that year.

Thanks for sticking around with me. I wish you all the best with your finances in your 20s.

Don’t forget to check out Studenomics!