How are you going to pay your bills?
Will you find another job?
Should you start your own business?
Sometimes you know your redundancy is coming and you can start making changes while you still have a day job. Sometimes losing your job just comes as a nasty surprise, perhaps because your employer has gone bust.
Redundancy happens to the best of us and the first thing to get over is the feeling that it is personal. It’s not. Companies run into financial problems, they restructure and some jobs have to go. You were just in the wrong place at the wrong time.
If You Know It’s Coming . . .
Most people know when a company is about to shed staff. They suspect their job will go, but they hope they will be safe. It is better to work on the assumption that your job will be gone very soon.
- Start to look at your outgoings to see what you can cut
- Talk to your trade union about what is happening
- Research the benefits you can expect to get; it’s best to know the worst
- Start looking for another job, even if it means you lose any redundancy pay
- Research self-employment ideas, another job might never happen
- Get contact details of your workmates because they could lead to another job
Stop spending money. Your income is going to be smaller, so your spending must also fall. There is no alternative and the sooner you make the cuts the fewer you will need to make. I know it sounds hard, but I was made redundant myself in 2010, so I know how you feel. Your main priority is to keep the roof over your head and everything else has to take second place to that in your spending priorities.
If your phone is out of contract then forget any ideas about an upgrade and take out a sim-only contract or even switch to Pay as You Go to get rid of that substantial monthly bill.
Phone your satellite or cable provider and ask if you can cut the number of channels, or even terminate the contract without penalties; there are plenty of free channels to watch.
You are going to be using the Internet more, whether you start your own business or are looking for a job. However, if you are paying a fortune for a totally unlimited deal that allows unlimited high-definition movie downloads it might be time to ask about a cheaper contract.
All your bills have to come down, including your electricity bill. Think twice about using the grill (broiler) or oven, use fewer lights, switch to LED bulbs, take out any halogen spotlight bulbs and take the fuse out of any portable electric heaters.
You are going to have to buy thermal underwear for the winter, rather than turning up the heating. Wear slippers, jumpers, woolly socks and even hats at home to keep warm.
Turn radiators in bedrooms right down; use the lock shield valve rather than the wheel-head valve to prevent them being turned up again.
Reduce the temperature at your boiler as well as turning down your room thermostats. Fit draught proofing under and around doors; the costs are soon recouped from savings in your fuel bills.
Buy electric blankets and warmer duvets for the whole family to reduce the complaints about bedrooms being cold.
On the Day . . .
Hold your head up high. You have done nothing wrong, so walk away with your pride intact. Make sure you have all the paperwork you need to claim any benefit you are entitled to. You will probably walk out with a redundancy payment; it might seem a large sum, but it has to see you through the next year, so pay it straight into your bank account.
Claim Your Benefit Entitlement
You have been paying social security and taxes all your working life; now it’s payback time. Claim every penny you are entitled to, fill out the forms, smile at the clerk behind the window and take the money that the government pays you back from the taxes you paid in better times.
If you had redundancy protection insurance on any of your debts then now is the time to make a claim. It usually covers your payments for 12 months, after that you are on your own again, but 12 months’ respite from your monthly payments is definitely worthwhile.
You should use your redundancy payment to repay anything you owe that are not covered by insurance. The company is not going to go away; you borrowed their money so you have to pay it back, end of story.
Pay off any credit card debts you have and cut up the cards. If you cannot afford to pay cash for something you need then you cannot afford it. You need to become part of the cash economy.
Keep to your normal routine in the mornings. Shave or put on your make-up every day. Dress smartly, as though you were going out to do the grocery shopping.
If you ever get into the habit of lying in bed until lunchtime and wandering around the house in jog pants wearing three days-worth of facial hair, it becomes very difficult to break it.
Update your CV and send it off with a few job applications every day. Always answer your phone as though it is a prospective employer on the other end; stand up, smile and be positive. (Standing and smiling both make you sound better at the other end of the phone.)
Bear in mind that you are not necessarily going to find a paid job; you will probably have to make your own job, to become self-employed. It is best to start thinking about self-employment from Day One.
You may even be eligible for financial support if you set up your own business while unemployed. Even if this only means a payment equal to the unemployment benefit you would otherwise be getting it is definitely worth having because it will help you to pay your essential monthly bills and reduce the drain on your bank account.