How you should prepare now for unemployment

UNEMPLOYMENT is rising and with it comes a lot of financial calculations and uncertainty that workers have not dealt with before.

Many Australians are facing the prospect of unemployment or reduced hours right now as the coronavirus outbreak causes businesses to shut their doors or cut back staff.

Comparison website Finder.com.au’s spokeswoman, Bessie Hassan, said nearly 20 per cent of Aussies were living week to week before the pandemic and those numbers had climbed since lockdown measures were put in place.

“The health crisis is having a devastating impact on the financial wellbeing of Australian households, especially those who had little cash in the bank before it hit,” she said.

If you think it’s possible you might be laid off in the near future, you can take proactive steps today to get your finances in order, so you’re prepared for the worst.

A first step is to contemplate how you would cut back spending.

The list of budgetary line items to consider should be familiar enough by now: food deliveries, online shopping and household utilities.

Being more aware of how you spend your money will cause you to spend it more carefully.

“Look for places to save money in all areas of life – particularly financial products,” Ms Hassan said.

Simplicity could become the new normal for a while. Other ways to save money include renting out your car or a room in your home, or growing your own fruit and vegetables.

For those still in a job, start building an emergency fund.

Finance specialist Glen James says to apply for Government-based help.

BE PROACTIVE:

If you’ve lost your job, Ms Hassan said to contact your employer as they might be able to hire you back in light of the Federal Government’s newly announced JobKeeper scheme.

Finance specialist and My Millennial Money host Glen James said there were a number of state-based government programs available to help you in the event of a lay-off, so take advantage of them.

“No one is above this,” he said. “People have found themselves without work in otherwise stable industries.”

Mr James said it was a good time for households to get their payments under control.

“Ask your creditors about a payment deferral and know which lenders have this option available if you need to call on them,” he said.

If you are already in debt, particularly credit card debt, you may want to consolidate your loans into a single monthly payment with a lower interest rate.

You will be able to stretch your savings if you have additional income.

Consider part-time work while you look for a job. Use social media and your LinkedIn profile for business networking. They can be invaluable sources for finding new opportunities.

moneysaverHQ.com.au