Worried about a layoff? 3 movements to do immediately

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Although the unemployment rate in the United States is considerably lower now than when it reached an all-time high in April 2020, it is still much higher than before the pandemic. While there is reason to hope that the economy will improve in 2021, especially with the widespread rollout of coronavirus vaccines, we probably still have tough months ahead.

If you work in an industry hit hard by the pandemic, or know your business is not doing well, you might be concerned about your job. The good news (“good” being a relative term) is that if you are fired through no fault of your own, you are generally entitled to unemployment benefits. But these perks may not be enough to keep you going without a paycheck for long. Here are some important steps to take if you are concerned that your job may be on the line.

1. Put more money in your emergency fund

While unemployment benefits can replace part of your salary (maybe even a large part), you can still lose a fair amount of money as long as you don’t work. This is why it is essential to have a emergency fund ready. Ideally, you should have enough in your savings account to cover at least three months of essential bills, and if you’re aiming for six months, that’s even better. If you can’t spend that much money right now, save what you can. The more you can save, the more leeway you will have if your job goes missing.

2. Identify budget cuts

If you are laid off and lose income, you may need to cut spending to avoid going into debt. Plan cuts in advance. Examine your budget and propose a backup plan. If you have a month-to-month lease, you can easily break it off, maybe you can go home or make other cheaper living arrangements to save on rent while you’re unemployed. If your options are limited, consider discounts like canceling a cable plan or other more modest expenses. The key is to be prepared, so if a layoff occurs, you are ready to respond immediately.

3. Secure a secondary job

A secondary job may not replace your regular job when it comes to income. But it could be a lifeline if you’re made redundant and your unemployment benefits don’t replace your paycheck enough. It may be beneficial to focus on any “scalable” side work, that is, work that you can do more often if your schedule allows. For example, if you currently sign up to drive for a rideshare company three nights a week, you could potentially drive more often if your main job leaves you.

Unemployed workers currently receive a weekly boost of $ 300 on top of their regular state benefits, and that boost is expected to rise to $ 400 a week once the last coronavirus relief proposal is enacted later this month. While a layoff is always a financial concern, you could at least be entitled to more income than usual. Also, keep in mind that in addition to unemployment benefits, you may be entitled to severance pay from your employer, which could also help you get by while you look for work.

Getting laid off is a scary prospect, and it has happened to many of us over the past year or so. If you take these steps, you may find that you can get through a period of unemployment with less financial hardship.

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