Job Loss? Here's How to Secure Your Finances During This Challenging Time

New Delhi. Losing a job not only disturbs finances but also breaks down a person emotionally. However, one should not panic and try to manage things and focus on planning to navigate through the challenging time. Experts advise that one should allocate the income into three categories: 25% of the income to be used for saving and investment, 25% should be spent on lifestyle expenses and 50% on household expenses. 

So, if someone has been laid off from the organization, they prioritize curtailing the lifestyle expenses. Pause the SIPs if going through too much turmoil. By considering some of the steps, one can manage the expenses.

Although it is a tough situation to handle but here are some tips to manage your daily expenses after a job loss:

Prioritize ruthlessly

Make a list of everything you spend money on. Separate those expenses into essential (housing, food, utilities, minimum debt payments) and non-essential (entertainment, dining out, subscriptions). Focus on keeping the essential expenses covered.

Renegotiate or defer expenses

Contact service providers like cable or internet companies and see if you can get a better deal. Ask about temporary deferrals for non-critical bills, explaining your situation.

Boost your income (if possible)

Look for ways to bring in extra cash.  This could be a part-time job, freelance work, or selling unused items.

Use your emergency fund (if you have one): This is exactly what an emergency fund is for. If you have one, don't hesitate to use it to cover your essential expenses while you find a new job.

Cut back on non-essentials

This might be difficult, but temporary sacrifices can make a big difference.  Consider cooking more at home instead of eating out, reducing entertainment subscriptions or using free alternatives, and delaying non-essential purchases.