Five steps to take if you have lost your job
Examine your savings, expenses and find the help available to you.
First, determine the amount of money you will have at the beginning of your unemployment. Will you receive severance pay or pay for unused sick or vacation time? Have you acquired any savings?
Next, review your expenses. What is the minimum amount needed to survive? This is the time to scrutinize all expenses. Decide what can be eliminated, replaced or reduced. Prioritizing your bills is extremely important. Your top goals are keeping a roof over your head, food on the table, functioning utilities, and prescription medication.
Will you be eligible to receive food benefits and unemployment benefits? There may be programs to help pay utilities, mortgage, child care, and prescriptions. Check with your local government or unemployment office to find resources that will help you.
Don’t forget to factor in health care. You have a few options from which to decide:
- Continue with the coverage offered by your employer via COBRA
- Go with a private insurer
- Investigate the Affordable Care Act Marketplace
- Research Medicaid coverage
Another important task is to contact your creditors. You should contact them as soon as possible, especially if you are concerned about continuing to make your payments. They are usually willing to work out a payment plan. It is critical that you follow through with the new plan once you have committed to it. Contact a certified Housing Counseling Agency, if you suspect that you will not be able to sustain your mortgage payments.
This is also an opportune time to obtain a free copy of your credit report. This will give you a clear picture of who your creditors are and give you a chance to clean up any inaccuracies.
Be proactive and follow these steps as you assess your situation and make a plan to move forward. In addition, Michigan State University Extension offers money management and homeownership classes in-person and online. For more information about classes offered in your area visit the Events channel on MI Money Health.