How Will You Live if You Lose Your Job?

Have you ever thought about how you will live if you or a spouse loses a job? This is something most of us don’t like to think about because it’s either uncomfortable or it won’t happen to us. It can, though.

My husband sent me a text message on Friday that was short and to the point. It said, “I just got fired.” After I called him to see if he was okay, I spent the next 45 minutes staring into space, trying to figure out what to do next.

I knew I had certain things I needed to do immediately to protect us and our income as much as possible, like refilling our prescriptions before the insurance got cancelled. I also did the math in my head. How much would his final check be with overtime and vacation time added? How much money would he get from unemployment? How many months of emergency fund did we have until everything we had worked so hard for was gone? To say it was unsettling is an understatement.

It turns out we’ve been planning for this day, sort of. We never expected him to get fired, but we have been responsible with our money. I can pay the mortgage for so many months and cover our monthly expenses before we dip into savings. It wasn’t always this way. We’ve worked hard and did without many things to get to this point.

So how would you live if you or your spouse lost a job? Do you have any money in savings? Do you know how much unemployment you would be eligible to receive? Do you know how you would pay your bills? Do you even know what bills you have?

I highly encourage you to take the followings steps, even if you don’t think it will happen to you:

1. Make a list of all your monthly expenses – loan payments, utility bills, groceries, gas, extra curricular activities for your kids, church tithing, rent or mortgage, gym memberships, prescriptions, Starbucks, etc. Add it up to see how much you are spending every month.
2. Pinpoint which of these expenses are wants and which ones are needs. If you take a sudden loss of income, remove the wants first.
3. Figure out how much you have leftover every month and start putting some of that money into an account with the highest interest rate you can get.
4. If you have a job that pays you overtime, live on the amount you usually bring home, and put all of the overtime pay in savings. This requires discipline, but you’ll be thankful you did. My husband has been at this job for a year and a half and has worked more overtime than regular time. Unless we had an emergency expense like car repairs or hospital bills, I put every dime of overtime into our money market account. It adds up faster than you think.

Unemployment is barely enough to make rent of pay mortgage. Make a plan now so life isn’t so uncomfortable if you lose a job.