Millions of people have lost their jobs in the previous year due to the pandemic. Hardly anyone was prepared for an economic slowdown second to the great depression. However, there are many lessons people learned the hard way during the unemployment phase.
One critical lesson was cost-cutting once the income was reduced to none. The limited savings could not have lasted forever in uncertain times. It was hard to manage the essentials while the employers were laying off people.
Nevertheless, you can save money on regular expenses to significantly reduce the budget. Here, we have mentioned some tips to cur expenses and save money during the unemployment phase.
Stop the Savings
It makes no sense to remain on the savings goal if you have lost your job. Many people will not have income from any source to contribute to the savings. Simultaneously, some may receive returns from an investment or some small income from side hustles.
There are more essential expenses than savings that include debt repayment and groceries. Timely repayments of your debt will keep the credit history clean for future benefits. You can stretch the timeline for the savings goal if the unemployment phase lasts long.
Take Repayment Holidays
Lenders don’t want to repossess the assets or file a lawsuit against their borrowers. Also, they understand the tough times to help their customers. Therefore, some lenders offer repayment holidays to the borrowers if they face a sudden financial crisis.
You can contact the lender to discuss the repayment holiday and the charges associated with it, if there are any. Ask them for flexibility with the installments if the holiday option is not available. It will save money from the savings account while keeping your credit history intact.
Ask the Landlord for Help
You cannot afford to go homeless because of some missed payments. A new apartment will also require rent and more security before moving in. Therefore, it is recommended to explain the situation to the landlord.
They might offer some relief on the rent for the next few months. Pay them the amount you can afford after allocating money for the essentials. Pay them the pending dues in installments after receiving a job offer.
Change the Insurance Policies
You don’t need expensive insurance plans to cover some needless emergencies with the present finances. Ask the insurance provider to downgrade the policy for various assets. This includes your car, house, renters, and medical insurances.
Search the internet for a new policy at a lower price. You may find the same coverage by spending less money. Discuss the offers from the competition to your present insurance provider to force them to reduce policy price.
Refinance the Car Loan
You can reduce the installments of a car loan with the help of refinancing. The process can take a little longer with the bigger financial institutions. Nevertheless, you can contact direct lenders for an instant decision on the refinance application.
You need to find the overall cost of the refinancing that includes any charges on the pre-closure. Do not sign the agreement if the overall cost far exceeds the present loan cost. However, the lower installments can help you stay afloat with the savings for a longer duration.
Take Financial Support
Many people live paycheque-to-paycheque only to end up with no savings to rely on during an emergency. The only option left now is to take financial support from family or friends for a short duration. They may not ask for interest over the loan amount and repayment until you get a job.
You can also take quick personal loans in Ireland if sharing the financial problem is not an option. The interest rates will be determined by various factors that include security, guarantor, and credit history. Contact a direct lender if the credit history is bad and there is no security or guarantor.
There are plenty of memberships that are non-essential to your lifestyle. The gym, Netflix, cable, and sports club can wait for the next few months. Make a list of the subscriptions and cut the unnecessary ones from the list.
You can easily find some free and engaging activity to divert attention from the stressful situation. Use the time to add more skills to your resume or start reading books to gain knowledge. Just make sure the activity doesn’t affect your job seeking on different platforms.
Smart shoppers can save a significant amount of money in grocery shopping alone. They know the shelf lives, nutritional values, and the right stores for each item. And learning the art requires some hours of research on the internet and visits to a few stores.
Always chose seasonal vegetables and fruits as they are cheaper and offer a longer shelf life. Visit the farmer’s market instead of supermarkets to find food items at a reasonable price. Also, try to buy the pantry items in bulk to get a heavy discount.
Contact the Service Providers
You should contact the service providers of the essential commodities such as electricity, water, mobile phone, and internet. They may provide you with a better offer after a few rounds of negotiations. Ask the competitors for offers based on your reduced requirement to strong-arm the present service providers.
Your negotiation skills will be tested once you dial the number. Do not waste hours trying to negotiate with the first executive who picks up the call. Ask for someone from customer retention or an individual with authority to provide a better offer.
Plan the Meals
Food requires a considerable portion of your budget as an essential expense. You need to optimize it with the help of a meal plan. Start with reducing the frequent visits to restaurants to minimal or zero.
Add some fruits and vegetables to the table instead of unhealthy and expensive items. You can preserve some food items to use for a whole week. You will save money while living a healthy lifestyle.
To sum up, you can save some serious money with the proper spending habits. It is critical during the unemployment phase as the savings is limited. The uncertainty over its duration makes the situation even more challenging to plan and manage the finances.