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I’m Afraid I’m Going To Get Laid Off. How Will I Pay My Bills? What Will I Do?

“Dear Steve,

When I read the news I get so afraid that I will get laidoff. Business at work seems to be slow and I find myself surfing the internet more at work and reading more of these stories about the pink slips that are coming.

I’ve got bills and credit card debt to payoff and a wife and kids to care for and I’m afraid. What should I do, or maybe, what can I do now?

James”

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The Answer

 

Dear James,

I’m afraid you are right, the news is not good about jobs in the near future. As an employer even I am not immune from facing those same pressures and potentially reducing staff. Even sites like one of my favorites, The Consumerist, has just laid off some really good writers.

Rather than blow smoke up your ass and give you hollow good news I’d like to give you some honest and from the heart advice that you can use.

  1. Losing Your Job Does Not Mean You Suck – When pink slips and job loss notices are distributed it does not mean that you are not a valuable member of the team. In my past I had to once layoff 18 members of a 70 person team. It was horrible at it and cried each time I had to do it. Maybe that shows a weakness in me, I’m not sure. Regardless, it was painful for all concerned.

    As an employer it was not a decision that I took lightly. I fully realized that these were the lives of good people that were going to be hurt by the failure of my business to produce enough income to support them. I was deeply hurt that I had failed them by not finding my magic wand to save them.

    Decisions to let people go were based on a number of factors that had nothing to do with who they were as individuals. Sometimes business is just business and what had to happen to save the remaining jobs.

    I guess what I’m trying to say here is that if you’ve been working hard, contributing ideas and help to the company, and doing your best, you could still lose your job but that it not a negative reflection about you.

    Layoff decisions in big companies come from slash and burn policies to reduce a specific head count or certain departments. Again, that is not personal it is personnel.

    You might find my America’s Job Bank page helpful for looking for a new position.

  2. Let’s Assume That You Are Going To Lose Your Job And Start Implementing a Plan – It is always better to plan for the worst and enjoy the best, if that is what fate is going to give you. And so much that life has to offer is fate or divine intervention or just random luck.

    Even before you get notice I think you should consider the following advice now.

    1. Talk Honestly With Your Family Now – Even if you’ve always maintained a facade as a strong provider it is time to sit down with your spouse and lay out the facts. Once the two of you are on the same page then it is time to sit down with the children and be open about the facts now. Let them know what your concerns and worries are. Let them know that there might have to be cuts and ask them to help where they can to reduce expenses. Keep the entire family in the loop so there are no bombshell surprises.

    2. Don’t Buy Another New Thing On Credit – If you might find yourself in a hole, you can stop digging it deeper right now. You can use your credit cards to make a purchase but make sure you are paying for what you buy in full each month. If things get really bad and bankruptcy might be in your future, which it might, then recent credit purchases can pose a problem.
    3. Cut Where You Can But Don’t Eliminate – It is important to prepare for an eventually but you don’t have to run for the bunker right now. If the family is used to going out to eat twice a week, trim it back to once a week and then maybe once every other week. You don’t need to cut out things that bring happiness completely.
    4. When You Face Fear, Bring Hope – You are facing uncertain times and these moments make us face our fears. Actually they just make us focus on our fears and make us feel desperate. The reality is that anyone can lose their job at anytime, and for any reason. Even in your best days there was always a possibility that you could be unemployed. You would have been hopeful then if that had happened, be hopeful now.
    5. Evaluate Most Every Purchase – As you are your wife go forward from this point, spend money wisely and thoughtfully. Start asking yourself why you are buying this thing and if you really need it. Here are some helpful pre-purchase questions to ask yourself, in your head. If you ask them to yourself out loud in line, people will stare.

      Pre-Purchase Checklist

      • I feel like I really want this. Why?

      • What does this thing represent to me?
      • Once I buy this, how will it make me feel?
      • If I don’t buy this, how will it make me feel?

      (This list is from page 122 of my book The Path to Happiness and Wealth which you can download for free as my gift to you.)

      If you find that you are purchasing an item because it makes you feel better, you deserve it or it reduces your stress; put it back. Now is not the time for medicating yourself with shopping. Now is the time to be a good steward with what money you do have.

      That means that if you feel like you must buy a name brand of a particular item that is more expensive and you have not evaluated the less expensive alternative, do it now. Just because you have always bought the name brand of an item does not mean that the extra expense is justified, it primarily means that you have associated a benefit from purchasing that product.

      Not that long ago I travelled all over doing some price comparisons and found where I could buy the things we normally use for the least amount of money. You might want to do this also to find out where your money buys the most. Read the article.

    6. Let’s Assume That You Will Not Be Able To Find a Replacement Job – It is better to deal with the issues of not being able to find a job that pays the same amount as you are making, now.

      There are certain realities to go along with that situation. If you do not have enough income to support your current lifestyle, you are going to have to layoff part of your current lifestyle. I guess that’s what trickle down economics is all about, at least in down times.

      You might have to go bankrupt, talk to your mortgage lender about a loan modification, buy generic instead of name brand, drive the family car till is falls apart, etc. All of these things are a reality.

  3. What Happens When You Lose Your Job – If you’ve been working this plan then you will be better prepared to deal with the pain and misfortunate of losing your income. At least by thinking about these things in advance you will have better prepared yourself for the eventualities. The most likely solutions when you are not bringing in enough money are:
    1. Only pay the essential bills; food, shelter, clothing, utilities, etc. You will notice that credit cards and other unsecured debts are not on that list.

    2. Look at credit counseling and see if that is a payment you can afford with your new limited income.
    3. Talk to a bankruptcy attorney and find out if bankruptcy is right for you. Many bankruptcy lawyers offer a free bankruptcy review.
    4. Reduce your lifestyle. Move to cheaper housing, rent if you have to. Trim back on expenses that you can’t pay for in cash. Get out of your car lease or refinance your car loan to lower your transportation costs.
    5. Think of your savings account money as water that can’t replaced in a drought. Consume it as carefully and wisely as you can. When it’s gone, it’s gone.

As always, I’m here for you when you need my help. I wish I was there to give you a big hug, goodness knows you sound as if you could use one. We don’t have to tell anybody.

Im Afraid Im Going To Get Laid Off. How Will I Pay My Bills? What Will I Do?
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • luis

    Dear Steve,what a times ,I am facing the same situation right now i am in the limbo suspended for almost two weeks  and don’d now  what they gone do ,any way as well  you said  we need act a nd have a back up plan ,and that is exactly what i am doing . I still afraid  you know  this  thing in may chest  . By other hand i use always say we just loose our job but still have aour skills . Is hard to face this  but is not the last  we have more to do .  

  • Turdsnifferonepointo

    this is new advice.

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