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How to pay your bills if you’ve lost your job

Stay on top of your finances while you look for a new job.

If you’re proactive in managing your money and dealing with your debtors, it’s possible to get through this period unscathed — and if that’s not enough, there may be resources available to help you until you’re back on your feet.

9 steps to meeting your financial obligations

If you’ve recently lost your job, it’s important to get in control of your financial situation before things start to go downhill. Follow these 9 steps to help keep yourself on stable footing while you hunt for your next job:

1. Apply for unemployment

If you qualify for unemployment, you should take it. Unemployment can help spare you the financial hardship of being terminated by a company should you qualify for it. You’ve dedicated time to this company and done your job, and it’s why they pay for unemployment insurance in the first place.

2. Calculate your savings

If you have savings, now is a good time to rely on your savings accounts and potentially trade in any stocks. Think about the outgoing costs you have and how long your savings will be able to support you so that you can focus on the most important tasks first.

3. Find out if you’re waiting on any outstanding payments

If you have any overdue invoices from past clients, insurance checks that haven’t shown up from a car accident or flood last year or even friends who owe you money, now’s the time to collect. You should also take stock of income-generating assets such as rental properties and figure out what you expect to receive each month.

Also factor in any benefits you can expect to receive in the future. For example, if you’re covered by income protection insurance, you can expect to receive a monthly payment until you’re employed again. Credit card payment insurance might be able to pay up to a percentage of your outstanding balance each month if you lose your job.

4. Prioritise your expenses for the next two months

Start by looking at your regular and essential costs, such as groceries and utilities, before considering your ongoing debts. When it comes to debt repayments, you can divide them into unsecured and secured loans.

For example, credit cards and personal loans are types of unsecured debt, while a mortgage or car loan is secured debt. Prioritize paying secured debts first, as creditors can reclaim assets secured to a debt if you don’t make your monthly payments. But if it’s possible, you should always aim to pay at least the minimum required on all of your debts.

5. Work out your budget

Work out a budget so you know how long you’ll be able to live on your savings, outstanding payments and any income support payments you receive. Remember, this is your safety net and there’s a chance that you could find employment sooner than expected. A budget can also help you cut unnecessary spending by showing you where the majority of your money goes.

6. Limit your spending

Using your budget, identify which expenses are your “needs” and “wants.” The expenses in your “wants” list can be cut to free up extra cash while you’re looking for more work. Gym memberships and subscription services like Netflix are examples of “wants” and can be canceled or suspended while you’re looking for work.

7. Contact your providers

Reach out to your creditors and service providers and let them know that your employment circumstances have changed. They will most likely offer you a range of options based on your individual situation, such as a payment extension, an extension of the loan term so you have smaller repayments, or a temporary hold on your repayments. You’re much more likely to get a positive response if you’re proactive and ask for help before the debt goes into default.

8. Continue seeking employment

This could include contacting colleagues and friends to see if they know of any appropriate opportunities you could apply for, updating your resume and connecting with people on services such as LinkedIn. There are also employment agencies and placement services that could help you find secure or temporary employment.

You may also want to get the money coming in again by picking up odd jobs or a side-hustle. The more money you earn right now, the more secure you’ll be if you do lose your job in a few month’s time. Online work is more accessible than ever, and freelance work platforms such as Upwork or are handy when you’re looking to make a couple of extra euros.

9. Explore debt relief

Debt relief is often used as a last resort because the implications can have negative long term effects on your credit score. Forms of debt relief include bankruptcy, debt settlement, and debt management. The main goal of debt relief is to drastically reduce the amount you owe your creditors, or in some cases, such as filing for bankruptcy, wipe the slate completely.

If you’re interested in exploring debt relief options further, make sure to do your own research first before committing to something that may not be right for you.

Do I qualify for unemployment?

If you were transitioned for reasons outside of your control there is a high chance that you qualify for unemployment benefits. The first step in finding out if you meet this criteria is to apply. Unfortunately, many people never reach this step because of preconceived notions regarding their eligibility and feelings about taking money from the government. Read about the eligibility requirements for Jobseeker’s Benefit on the Citizen’s Information website.

Know your rights

  • Redundancy: If you’re a permanent employee and you’re made redundant, you may be entitled to redundancy pay. The amount you get is dependent on your employment agreement.
  • Sick leave: Full-time and part-time employees might be able to take paid sick leave if they need to look after themselves or a sick family member.

Other options to consider

Consider the following options if you’ve lost your job and money’s tight:

  • Debt consolidation. Consolidate your debts into one monthly payment. A debt consolidation loan or balance transfer credit card can save you money by giving you a lower interest rate. Some lenders accept unemployed applicants.
  • Emergency help services. Charity and community organisations can provide emergency financial assistance if you spent all of your money paying your bills and don’t have enough for food or other essential costs. You may also be eligible for government assistance. Contact your local government services department.
  • Short-term loan. If you need help paying for everyday expenses while you job hunt, some lenders offer short-term loans to people who are unemployed. Keep in mind that these loans are likely to have high interest rates and should be a last resort.

Should I use my credit card to pay bills when I’ve lost my job?

Avoid using your credit card to pay your bills. Creating new debt to pay an older debt is a slippery slope to financial ruin. Instead, work out a plan with your provider or contact a nonprofit financial adviser to discuss your situation and get specific advice on how to manage your financial commitments.

The exception to this rule is a balance transfer credit card. If you already have debt on several credit cards, a balance transfer card with a 0% introductory rate can help you avoid accruing interest on your current cards while you get back on your feet. This is only a good option if you feel confident that you’ll be able to repay the balance before the introductory period is up.

Frequently asked questions

The stress of unemployment is getting to me. Where can I get help?

If you’re suffering a mental health crisis and need immediate help you can phone or go to your local doctor, go to the Accident & Emergency department of your nearest hospital or call 999.

If you’re not currently in a crisis but you require access to mental health resources, Samaritans is available 24 hours a day, 7 days a week. For confidential, non-judgemental support call 116 123 in the Republic of Ireland or the UK. You can also visit for details of your nearest branch.

Do I qualify for unemployment if I was fired or quit?

There are circumstances in which you may still qualify if you were fired or quit. However, it’s important to contact your local social services for more information before assuming you don’t qualify.

Could debt consolidation help me pay my bills?

Possibly. Some people can save money on interest and cut down how much they’re paying over the life of their current debts, how much they pay each month or both. However, that’s not the situation for everyone. Your best bet is to do some research on what debt consolidation loans you could qualify for, work out what you’d have to pay each month and over the term of the loan and then decide if it’s the right financial decision for you.

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