Budget Categories to Cut First When You Lose Your Job
Job loss hurts. Aside from the emotional loss, worrying about how you’re going to make ends meet is also stressful. If you lose your job and have to reevaluate your monthly expenses, there are several categories that you should focus on first.
Obviously, emergency funds are needed to stay afloat when you lose your job. But it’s also important to keep a close eye on your monthly spending. Most of us will have to cut costs a little if we lose our job, but where do we start?
Finance writer Donna Friedman of Credit.com offers food. Food is obviously a must, but it’s usually a budget category with little wiggle room. You can bring dinner, start cooking everything at home, and when friends want to go somewhere, invite them instead. In addition, Friedman suggests focusing on utilities and transportation:
Utility bills can be a budget killer, especially during hotter-than-normal summers or harsh winters. But, as a rule, these costs can be reduced – and sometimes you can get free advice and / or materials. Check with your local utility provider.
Transport is another place to cut yourself. I grew up in the countryside and I know that life without cars is not always possible. But you can cut your gas bills by sharing a car, cycling, using public transportation (if applicable), and combining errands. Or suggest “shopping in the car” – you and a friend or two go to the supermarket together and share the gas.
We’ve talked about this before. It helps you focus your money-saving efforts on the categories with the greatest impact . We’ve included housing in our review, but that may not be the most practical advice in the event of a job loss – it’s not easy to simply move and cut housing costs. However, there are usually many ways to save money on food, utilities and transportation.
For more details, check out the full publication at the link below.
How To Adjust Your Budget When Income Falls | Credit.com