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Jobs: A Special Report, part two
It has long been an underlying tenet here at the BlueCollarDollar that you look for something to do that provides you those things while you still have a job. If you failed to follow that advice, now is the time to take some sort of inventory of your likes and dislikes. For the newly unemployed this is really a lot easier that you might think. For the long term unemployed person its time to look at your approach. First, the newbies. You need to take financial stock of where you are. I don't recommend jettisoning all your worldly belongings and minimalizing your life... yet. But look to assess where you stand from the point of minimums and waste. The minimums should be tallied from all of your bills. There is an outside chance that you are the rare individual who has no bills other than the basic necessities such as food and shelter. You can skip this part and go to the next section on merit. If you have bills, add them up and subtract them from the total of all cash assets including your unemployment benefit. Cash assets include any savings or other cash income that was due you outside of the check your employer paid you. Wait for the 401(k) rollover until your head clears some. That is a big financial decision that is best left for just a little later. Now we will take a look at those debts in order of importance going from the least to the most.
It is important to note two things here. One is the protection of your credit is important for long range goals. These are short term circumstances and believe it or not, the blemish isn't so bad as the psychological effects. The second thing is prevention. These will be stressful times that could have been avoided. Remember that when you become gainfully employed again.
If you have kids in college, this may effect your ability to pay their tuition. In the short term this will be heartbreaking. But in the long term, they will be able to apply for additional financial aid and possibly grants.
Pay your rent, mortgage, and utilities. Providing yourself with shelter and the amenities that make life livable should be your highest priority. This doesn't mean refinancing and taking cash out of your house to sustain your lifestyle. If refinancing in advance of a layoff will lower your monthly bills significantly, then by all means take whatever action you would take in normal economic times. You will have little luck trying this after the layoff. Take a good look at other loans that are tied to collateral. Cars can be repossessed but there is little likelihood they will take a washing machine. In every situation, take the time to write your creditors asking for help. If they do not respond, then you may be left with no other option but to become delinquent. It is easy to look at the waste in your life as the reason you are so cash strapped. But those spent dollars altered the way you think of yourself. So you want to be careful about slashing your way to misery. You still will need to sell yourself as you begin your job hunt. Just a little note here. This unemployment period should not be treated as a vacation, even if your severance package (lucky you) was enough to make the transition comfortable. Get busy looking. Take your time to be measured in your approach. You want to be frantic without seeming so. These are all however, short term adjustments for the possibility of long term problems. Order your copy of Building Wealth in a Paycheck-to-Paycheck World by Paul Petillo. It is packed with safe, proven wealth-building strategies that cover all the major components of a balanced financial plan, including:
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