When there is a reduction in income whether it is due to a job loss or reduction in hours, it can really take a toll on the family.  Before we get into the financial aspect let’s consider the emotional and psychological impact job loss can have.  Now is NOT the time to shy away from communicating.  The worse thing that you can do is try and hide the situation.  Communicating to the family about the change in the family resources is important so that they understand the changes that will be taking place.  I’m not saying panic your family but be realistic in what it means for the family resources.  Setting expectations at the very beginning is important since it can take a while to recover the income or find another job. 

The first thing that you must do is stop spending immediately.  By immediately I mean the moment you find out your job has ended.  This is not the time to try and keep things normal as far as spending goes.  It is important to minimize expenses immediately and hold on to cash since your income stream is temporarily reduced. (You WILL find another job, it just may take some time.) Start by looking at your flexible expenses such as eating out, groceries, entertainment and any subscription services you’re paying for and NOT using.  You might be thinking groceries???  Yes, groceries are a flexible expense in that you can choose more cost-effective items over others.

Now is not the time to shy away from your budget.  It is important to allocate your resources and track your spending.  If you are not using a budget, then you must start NOW.  If you are using a budget it’s time to analyze it to see where changes can be made. This is also a good time to take a look around the house and see what you’ve been meaning to sell.  It’s a great way to generate extra income to put up for later use.

You know that emergency fund you have in place?? It’s times like these that it will come in handy. Pull out your emergency plan that you created to identify if it is time to start using it.  Not sure what an emergency plan is? Check out my livestream “An Emergency Fund is NOT ENOUGH”.  The key here is to know when to use your emergency fund.

It’s time now to focus on replacing your income. Time to refresh your resume, take stock of your skills, reach out to your network and search out your next opportunity.

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