For most of the population, employment is what keeps our finances healthy and life ticking over. It allows us to grab a designer coffee on the way to the office, pay the mortgage, or enjoy annual vacations to idyllic destinations.
Without our job, we can plummet into financial insecurity and experience mental health issues from anxiety to depression. These problems can be mitigated by knowing what financial support is available to you.
Bloomberg recently reported that South African job losses would almost reach 30% due to COVID-19, which is an alarming statistic being matched or exceeded in Europe and the USA.
First, It’s Time to Make a New Budget!
A monthly budget is helpful whether you are employed or not. In fact, monthly budgets are usually more beneficial when you are down on your luck. If you already use one, remember to update it with your reduced income to see a clear picture of your finances.
It may help you to identify items, subscriptions and memberships you should cancel while you seek new employment. We recommend checking out this in-depth guidance from Wonga on what to do when you become unemployed and are facing an imminent loss of income.
Also read: How Self-Employed Person can Maintain Balance in their Work and Personal Life
If you have recently been made unemployed, there are financial support options available:
The first point of call should be to investigate what state support is available for you. Your government will have finances available while you search for a new job.
It is best to investigate this option as soon as possible because most governments include a cooling period before paying out the first instalment.
You may have lost your job but already have a new one lined up. This doesn’t mean there won’t be a period of instability for the weeks or months between these jobs.
The good news is that in these situations, an emergency loan is a viable option. Because you will have an income soon, lenders will be more likely to offer a loan to tie you over.
You will probably need to supply your new job contract to get approval. Each case may be different.
Also read: Report Says India's Sensex May Treble by 2025. Here's What is Driving the Growth
Sudden unemployment can be even more worrying for people who have mortgages and debt. The best option in these situations is to contact your mortgage lender or creditor and tell them you have lost your job.
You may be able to go onto a payment holiday while you search for a new one, and some loan companies will renegotiate a reduced payment plan to help you get through your period of unemployment.
Some businesses run unemployment insurance schemes to help workers retain their income in the event of losing their job. This works by signing up to the scheme when you get your new job and some of your salary going into the scheme directly.
Some workers forget they signed up and therefore don’t realise that there is financial support waiting for them right now. Check your contract to see if you are involved in an unemployment insurance scheme.
Even if just one of these options is available to you, it should go some way to easing your immediate financial worries!
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