Surviving a Layoff
Tips to help you put your best foot forward after a sudden job loss or reduction in income
Losing a job is one of the most stressful events in life and produces enormous financial and mental challenges. A sudden loss in income is a game changer, and constant worry creeps in as you try to find a way to pay bills and provide for your family. Worst of all, it could happen to just about anybody and sometimes your job security is out of your hands.
But unemployment does not have to ruin your finances. There are ways to weather the storm, and it may provide a good opportunity to re-evaluate your spending habits and cause you to make sensible changes in your life. And at the end of it, you may even find a better, more satisfying job – you just need to endure the dry spell.
In some cases, emergency funds, employment insurance benefits and reduced spending cannot make up for lost income, and you may need a helping hand. If you are worried about bills and you are not sure where to turn, our trained credit counsellors may be able to offer some advice. Give us a call at or try our Free Debt Analysis online.
Here are some financial strategies to help you survive a layoff.
- Retool your budget – Your income levels have changed, and so too must your spending levels. Re-evaluate your budget and make changes where necessary. Our website has plenty of budgeting resources to help you with this. Try to avoid leaning on credit cards; mounting interest will only magnify your financial troubles.
- File for Employment Insurance (EI) benefits right away – If you were laid off through no fault of your own, you may be eligible for EI benefits. Apply online through Service Canada immediately so that you can receive benefits as soon as possible. If you delay filing your claim for benefits for more than four weeks after your last day of employment, you may lose benefits.
- Check your benefits – See if your company offers a severance package following your layoff, and see if you are owed anything else (such as unpaid overtime or vacation pay). If you are not leaving on negative terms, ask your supervisor for a reference letter.
- Come up with a plan for your bills – Your income may have stopped, but your bills won’t. Try to eliminate any unnecessary bills or downsize services like cable or cell phone packages. Also, try to negotiate with your creditors to work out a lower payment arrangement. Trained credit counsellors can help you with this.
- Downsize – It might be a difficult thing to do, but now might be a good time to take an honest look at your assets and think about wants and needs. Selling an extra vehicle might help you make ends meet and downsizing to a less expensive home may be necessary if you cannot find a job soon at your old salary.
- Full-time job hunt – The job hunt is no easy task and it requires dedication and time. Take advantage of government employment programs that offer resume and job interview workshops. You may even consider temporary work so that you can pay your bills, gain experience, and make connections. It may even turn into a “real job” once the assignment is over.
A layoff can have devastating effects on our financial and personal well-being. Even the best-developed contingency plans can only last so long, and if you’ve been unemployed for a long period of time, you may need help sorting out your finances. Speak to a trained credit counsellor by calling or take our Free Debt Analysis and see how Consolidated Credit can help you bridge the gap.