With record numbers of Americans facing layoffs and unemployment, workers everywhere are on edge. Some folks have fully-stocked emergency funds, while others scramble to pad their savings accounts and polish their resumes. For those who are concerned about potentially becoming unemployed, it is never too early to prepare. Here are a few strategies that some Americans use to ensure financial stability if they become unemployed.
Trim Expenses and Pay Down Debt
One of the most valuable first steps towards long-term financial stability is creating a budget and sticking to it. For individuals looking to pad their savings or who are concerned about becoming unemployed, slashing expenses is often a good choice. Some people put unnecessary spending on hold while they build up their savings and pay off debt, applying some of their pay monthly toward specific financial goals. This can be incredibly useful for those who find themselves unemployed down the line. Keeping up with loan payments and credit card debt can make the loss of one’s income even more daunting, so prioritizing debt reduction may be wise for some individuals.
Create an Emergency Fund to Use When Unemployed
Contributing to savings or an emergency fund each month is a common practice. For many Americans, the goal of a rainy day fund is to have enough money to cover expenses for anywhere from a few months to a year or more. While saving this amount of money can be intimidating at first glance, having a robust emergency fund can be life-changing during unemployment. Those concerned about employment should consider how much money they should save in case of an emergency and how much they can put towards the fund each month.
Prepare Sooner Rather Than Later
The most critical aspect of emergency financial preparedness is getting started before incidents occur. It is never too early to prepare for unemployment, and those without plans should consider their financial situations, future goals, and monetary needs in the event that they become unemployed. Many people start preparing slowly, and putting a few dollars away each pay period is better than not saving at all. By getting the ball rolling and gradually ramping up their savings and debt reduction, individuals can bolster their savings and mitigate the effects of unemployment.
Take Control of Your Finances with EveryIncome
EveryIncome is dedicated to providing our clients with career and finance management tools to help them create a stable financial future. Regardless of where you are in life, our system of tools and guided learning is tailored to fit your specific needs. Take control of your financial health today. Contact the team at EveryIncome online or give us a call at (571)370-5400. For more tips and tricks to foster financial wellness, follow EveryIncome on Facebook, Twitter, and LinkedIn.