What steps should I follow when I find myself without a job?
First, you need to assess your financial situation on paper, even if writing it down reveals a picture you don't like. There is less anxiety in knowing than there is in ignorance.
Write down your assets and your debts, your monthly income and all the monthly or weekly expenses you can identify-all the financial realities you have to deal with in the coming weeks or months.
How do I set up a personal budget? Where should I start?
Go to any bookstore and pick up a household budget book. This makes it easy to list all your various expenses-rent, gas, electricity, groceries, that kind of thing. You will not only see how much you now spend every month but where any waste is.
Suppose I find I have more bills than I can pay?
Talk to your creditors. Generally, creditors will work with you if they understand what your problem is. They have little to gain by not cooperating with you. Fill them in on your financial situation. Don't hold back out of embarrassment. Usually they want to come to some kind of terms on how to pay your obligations. Offer them specific alternatives such as partial payment, ex tended terms, etc.
What about credit cards?
Credit card issuers should be handled as fairly and openly as other creditors.
In many cities you'll find a name such as Credit Counseling Service listed in the phone book. Many such services are run by not-for-profit groups such as churches or city government. You might be pleasantly surprised at the professional help you can get in managing credit card accounts and all your other credit obligations.
How do I deal with unreasonable collectors?
A collector can reasonably expect you to tell him or her when you are going to pay your bill. He or she can't be abusive or harass you. He or she can't call you at odd hours or at work if you tell him or her not to. The law provides a lot of protection. Answer collectors' questions, but don't put up with abuse. You don't have to.
Do I have more financial resources than I realize?
Yes. Most people don't know what their net worth is. They are surprised to learn that they have money in the cash value of a life insurance policy, for example, or maybe some money in a company pension plan they can utilize.
Other possible sources of funds: back pay, severance pay, unused vacation pay, partial year's bonus, expense account balances, and profit sharing.
What are some good belt-tightening techniques?
Keep track of every penny you spend. If you put a quarter in a candy machine, jot it down so you know what you spend. After you keep records for a week or more, you will discover that you are spending a lot on things that you don't need.
What about the really big items, like mortgage payments?
If you are paying on a mortgage and money is really getting tight, check into paying just the interest each month. Your mortgage holder will give you details, but often you can make the interest payment only and suffer no consequences except having your payments stretched over more months. For example, many mortgage holders will still give you a good credit rating if interest but not principal is paid on schedule.
