How to Survive a Job Loss
Losing your job can happen suddenly. For instance, in the recent case of Sears Canada, the 65-year-old company was liquidated rather suddenly, leaving 12,000 people out of work. A sudden job loss can be very difficult to deal with, as you do not have much time to prepare and adjust your financial situation to compensate for the loss.
Here are some tips for managing your money while you look for work.
- Note that, if you qualify, employment insurance benefits could help replace a portion of your income for a limited time. You need to apply for employment insurance benefits. More information can be found on the Government of Canada website.
- Create a budget. Even if you already have a budget, you’ll likely need to create a new one to compensate for your limited income. It can often take several months to find a new job so, in the meantime, you’ll need to come up with a new budget to manage your finances during this time.
- Tips for reducing your budget
- Reduce or eliminate cable, phone, and internet expenses. Shop around and look for lower prices, or change your current plan to one that costs less each month.
- Consider cutting memberships and subscriptions. Gym memberships, magazine subscriptions, and streaming services all cost money each month. For at least the time being, you may want to consider cutting these services.
- Limit eating out. Eating out at restaurants and take out locations is almost always much more expensive than shopping at the grocery store and preparing your own meals at home.
- And, when you do go grocery shopping, make a list, shop with coupons, check flyers to get the best prices, and consider buying in bulk to save money.
- You’ll likely need to prioritize your expenses. Make sure you have enough money to pay for what you absolutely need and then come up with a plan for how to use whatever is left over.
- Contact your creditors and let them know your situation. Be honest. Tell them that you have lost your job, that you are looking for a new one, and that lower monthly payments would help you afford your bills. Many creditors will realize that, if they do not lower your monthly payments by reducing interest charges, you simply won’t be able to pay them. They would rather receive something instead of nothing.
- Speak with a licensed financial professional. Some people are hesitant to get help, but discussing your finances with a licensed professional can be extremely helpful. Some professionals, such as Licensed Insolvency Trustees, offer free consultations to discuss your financial situation.
- Tips for reducing your budget
Coping with Stress and Grief
A job loss doesn’t just hurt you financially. It also takes a toll emotionally and mentally. Of course, when you lose your job, you will almost certainly experience stress regarding your finances and your bills. Financial stress can be all-consuming and leave you feeling as if you have no control. The lack of financial security you may feel after losing your job can be very tough to deal with.
However, even if you have your financial affairs in order, there are still many ways in which losing your job is emotionally and mentally tough.
For a lot of people, a job is more than just a way to earn a living. Jobs give us structure and purpose. They influence how we see ourselves. For people who have strong personal relationships with their co-workers, a job loss can mean the loss of a social network or support structure as well.
It’s important to remember that feelings of grief and stress following a job loss are normal. Give yourself time to cope with the loss and adjust to your new situation. Talking to friends, family members, and other people you trust can also be very helpful. Some people naturally feel like withdrawing from social situations following a job loss, but the reality is that talking to people who are willing to listen and support you is extremely helpful.
You will want to make sure to take care of yourself during this difficult time. Be sure to eat well, exercise frequently, and try to get plenty of sleep. Limit alcohol and nicotine as drinking and smoking can actually make you feel more anxious in the long run, in addition to the negative health affects of these behaviours.
Create a job search plan, and break larger goals into a series of smaller ones to stay motivated. If possible, try to learn some new skills and set up meetings with networking contacts to improve your chance of successfully finding a new job.