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Budgeting for Unemployment

April 1, 2011

As costs are on the rise, employment rates are steadily falling. Large corporations are restructuring, companies are cutting back on costs, and numerous factories are shutting down. Many people are suddenly finding themselves unemployed and in need of financial help. It is often necessary for unemployed individuals to cut back on costs and streamline their budgets in order to survive a failing economy.

Unnecessary Costs
Everyday luxuries become so common that many don’t even realize the amount of money they are spending each month on items they can easily do without. While it is nice to splurge on yourself once in a while, it is best to avoid too many of these luxuries if you are currently unemployed or in need of financial help. Try to avoid unnecessary costs, such as stopping by your favorite coffee shop in the morning or going out to eat. Try making a thermos of coffee and packing your lunch instead. You’ll be amazed at the amount of money you will save each week simply by cutting out a few small extras.

Saving Money on Electric Bills
Electricity bills are often one of the highest utility expenses people have each month. Cut back on your electricity costs by following these tips:

  • Turn out the lights—Don’t leave lights on in a room nobody is using. When you leave a room you will not be in for a while, turn the lights out. You can save even more money on electricity by using energy efficient light bulbs. Energy saving light bulbs are more expensive than traditional bulbs, but will last approximately 10 times longer and use much less energy.
  • Don’t leave items in standby—Electronics such as computers and DVD players should be completely turned off when not in use. Leaving appliances in standby mode means they are still using a small amount of electricity.
  • Unplug it—If you are going to be gone for an extended amount of time, unplug all appliances that do not need to be running. Even when plugged in, electricity is being used in small amounts.

Cutting Costs at the Grocery Store
Next to utilities, the grocery bill is perhaps the largest monthly expense people have. Depending upon the size of your family, it may even be your largest expense. Cut down on your grocery bill by following these tips:

  • Make a list—Keep a piece of paper and pen on or near your refrigerator and write down items as you run out. Look over your list before going to the grocery store, and make sure you have included everything you need. When you get to the store, go directly to the area where each item is and stick strictly to your list. Avoid being tempted by browsing the aisles.
  • Don’t go hungry—Try to plan your grocery shopping trip to be right after a meal. If you cannot do this, at least eat a light snack before shopping. Going grocery shopping when you are hungry will likely only tempt you to buy items you don’t really need.

Credit Card Pitfalls
One of the most important tips for wise budgeting during an economic downfall is to avoid using credit cards. Many unemployed individuals are often led to use credit cards to pay off expenses and make purchases. Interest fees and late payment charges will eventually catch up to you though. You will also be more easily tempted to make unnecessary purchases if you are using a credit card. It is best to completely cut out using credit cards and keep one put away only for emergencies.

Written by Lauralynn Schueckler · Filed Under Credit Counseling 

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