Lost your job? Here is what you should do to put your money matters in order
Pink-slip is the talk of the town if you are employed in the information technology sector. While changing technology and policies of Donald Trump marred the sentiment in IT sector, the demonetization exercise carried out last year has hit many domestic businesses, which have fired many of their employees. Here are a few money tips that will ensure peace of mind for the less fortunate ones.
Pick up every rupee from your employer
This may sound very basic. But in the shock of losing the job, many employees forget to collect their dues. Seek help from your human resource representative and get a clear idea of how much money the company will pay you and by when you will be getting the money. If you are in dire need of money, even consider withdrawing your provident fund.
Review your situation
Make a list of your assets and liabilities if you do not have one. The liabilities will include monthly expenses, loan EMIs, insurance premium etc. The assets will include your savings and investments. Check if your emergency fund is in place and how long you can go without getting another job. You can take more informed decisions if you know the broad picture.
Cut your spending on wants
Be it the new gadget you planned to buy or the vacation you just booked with some token money, it is time to reconsider your decisions. If there is no regular income, the wants must wait. Even if there is a small loss incurred due to cancellation of your plan, one should take it, instead of putting more money on it to ensure that the money already spent is not ‘lost’. It is time to take some hard decisions. If you have been eating out regularly at the best fine-dining places, better think of cooking at home or go for cheaper options. One cannot change his habits overnight, but a step to cut down on expenses can help you coast along for a bit longer time.
Never skip insurance premium
Insurance premiums are seen as a cost. But term life insurance premium, health insurance premium must be paid. If you skip paying the premium, there is a chance that the cover ceases and a hospitalization can burn a bigger hole than the one caused by the loss of job. If you were solely dependent on your employer provided health insurance, it is time to buy one for yourself and your family.
Take care of your credit card dues
Credit cards are a great means to pay. But most individuals use them as means of revolving credit. If you are one of those who depend on credit cards, you are in tough times. But do settle your credit card dues and do not avoid repaying the money. Otherwise it will pull down your credit score and may deprive you from any other loan. Hence, pay your credit card dues in full before due date. If you can’t pay the money in full, you may want to convert it into a more manageable personal loan to avoid penalties and high interest rates.
Reschedule your loan repayments
If you have large loans outstanding such as home loan and car loan, it is time to review your money situation. If you are not sure of getting another job quickly and you may not be able to pay your EMIs, it is time to call your banker. Most bankers would be accommodative if you have been regular with your loan repayments. You may not get a long moratorium, but there is a high possibility that you will be offered a longer repayment tenure which will reduce EMI.
It is perfectly right to get into a defensive mode after losing regular income. However, one should not overdo it. Do not try to liquidate all your investments at one go. Let your long-term investments run their course. Most mutual fund houses offer to pause SIPs; use it if you find it helpful. This ensures that you are not pressurized to invest at a time when you do not have income. It may be a good idea to invest in your skills. You may consider taking up a short course to acquire new skills that are in demand. This not only enhances your employability but also makes you more optimistic about future.
Look for money
If it is taking a long time to get another job, use online market places to sell off unwanted possessions – things you have not used for at least a year can be looked at to decide if you do not want them anymore. Keep your family and friends in the loop. They may offer you some monetary assistance and also help you to land your next job. Do get in touch with your professional contacts -- they are more helpful in such trying circumstances to land you your next assignment. You can also work as a freelancer or take up small assignments if possible, till you land another full-time job.For many, loss of a job can be a big blow – both in terms of money as well as career. But you should not lose hope. It is time to keep your cool and introspect. Never forget the old wisdom, ‘Whatever happens, happens for good.’ Start afresh and you will emerge winner.