Losing your job can be devastating, but after the initial shock, it’s often managing things in the days and weeks that follow that can feel the hardest.
Being made redundant may have come like a bolt from the blue or it could have ended months of uncertainty. Whatever your circumstances, you’re likely to feel angry and upset about what’s happened and coping without your salary won’t be easy. But you can take steps to make you feel a little more in control and to get the best from the money you have.
Here’s what you need to know.
- Make the most of any redundancy money
- Don’t hide away
- Set yourself a budget
- Lock your credit card away
- Consider a mortgage payment holiday
- Organise your finances to suit you
- Don’t switch banks
- Team up with others in the same boat for support
- Make the most of cashback and discount voucher sites
- See if you can claim on payment protection insurance
- Check whether you’re entitled to any benefits
Make the most of any redundancy money
If you’ve only been paid the minimum level of redundancy pay, you’ll probably need it for day-to-day expenses. If you’ve been given a lump sum, don’t make any big decisions about it until you’ve worked out what you want to do. You may decide to retrain or start your own business, for example, and will need to conserve as much of any payout as possible to put towards this. Learn more in our article How to make the most of your redundancy pay.
Don’t hide away
You may be tempted to hide away after you’ve been made redundant, but this is often the worst thing to do. Try to get out and meet people, as you never know what opportunities might arise from making new connections. Everyone’s aware of the possibility of losing their job so you’re not alone. Use social occasions to network and spread the word that you’re looking for work.
Remember too that Rest Less has an extensive set of resources for people in your position. Our Jobs section includes a search tool for jobs from age-diverse employers across the UK, career advice articles, and one-to-one services for things such as career coaching and CV advice.
Set yourself a budget
Work out how much you have in savings, including any redundancy payout, and then think about how long this is likely to last you. To do this, you’ll need to have a clear idea of all your essential spending each month, for example, how much you pay for energy, food, council tax, your rent or mortgage or so on. Once you’ve worked out your monthly spending, divide this into the amount you have in savings so you can see how many months you should be able to cope financially until you run out of money. Learn more about budgeting in our guide How to make a budget and stick to it and for more information on managing your finances if you’re made redundant, read our article Sorting out your finances if you’ve lost your job.
Lock your credit card away
If you’re the kind of person who goes on a spending spree to cheer yourself up when you’re feeling down, don’t take it with you when you go shopping, or ring your card company and ask them to lower your limit. The contact details will be on the back of your statement. Don’t spend money on your card unless you can afford it. Facing the bills afterwards will do nothing to lift your spirits.
Consider a mortgage payment holiday
If money is really tight and you have a mortgage, ask your mortgage lender if they might be able to give you a payment holiday while you get back on track. It means you don’t have to make any mortgage payments, normally for between one and six months. Be aware that your mortgage payments will go up after your payment holiday as the unpaid interest is added to your loan.
Organise your finances to suit you
Paying for car and household insurance in one go often means you get the better deal but if your finances are stretched, it may make more sense to pay monthly. Some insurers charge a high rate of interest on monthly payments, but others don’t charge anything at all, so check when your policies are next up for renewal and shop around to see if you can reduce costs.
Don’t switch banks
Your credit score will suffer if you’re not in work, and can be affected even if you change your job. That means now is probably not the best time to make other major changes (such as switching your current account to a different bank) as that could also harm your credit score.
Team up with others in the same boat for support
If you’re worried about spending money socialising, team up with a friend who’s also on a budget. It may be someone who’s also lost their job, or who has recently retired. It’s easier to say no to things or that you can only afford to spend a certain amount if you’re not on your own.
Make the most of cashback and discount voucher sites
Don’t spend money just to get a discount or cashback, but you may as well make your money go as far as you can by using cashback sites and voucher codes whenever you’re shopping. Learn more about how these work in our guide Cashback websites: how to earn money when you shop online.
See if you can claim on payment protection insurance
Dig out your loan agreements or bank statements to see if you’ve signed up to any payment protection policies. This type of policy can be expensive and they are now rarely sold due to the fact many were previously mis-sold, but if you do have one, now is the time to use it.
Check whether you’re entitled to any benefits
If your redundancy money is running out, or you only received a small payout and are struggling to copy financially, it’s worth seeing whether you might be eligible to claim any benefits. Charity Turn2Us, for example, can help you understand what benefits you’re entitled to through their Benefits Calculator and any additional support they might be eligible for through their Grants Search. Entitledto also provides a benefits calculator that is free to use and can help you discover which benefits you might be able to claim. Find out more in our article on Five free sources of help if you’re making a benefits claim.
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