Budget Unemployment seven Tips on how to Manage your Finances when out of Work

For the millions of Americans and tens of thousands of Canadians who are out of work, it could be quite difficult to look after one’s personal finances when there is no source of income coming in. Indeed, it can certainly be a horrific situation to be in.

When unemployment is hovering at around eight percent (many economists put that figure in the low-20s), the dollar is being devalued, the cost of living is soaring and there is so much negativity in the mainstream media, it’s easy to become morose and pessimistic about the future.

One should not despair or become a nihilst, however. Even though you may be unemployed for an unspecified period of time, there are ways that you can manage your finances, while still holding onto the cash you have accumulated until you begin work again.

Here are some tips to manage your finances while you’re unemployed.

Budget A vs. Budget B

All households should keep a budget. A budget can change relatively quickly, though. In this situation, one member of the household is unemployed, which means the budget must be revised in order to keep track of expenses, savings, emergency funds and if there are any income generators at all.

Your budget must reflect this and be substantially differentiated from your previous budget.


Wherever you go, be sure to have a small book of blank pages and a pen. This way, you can track how much you’re spending. It doesn’t matter if it’s a cup of coffee, a newspaper or public transit, write it down and tally it at the end of each day, week and month (possibly even year).


Do a thorough audit of how much you have in the bank, how much you can live on without working for three months and how much you generate each month in interest, dividends or residuals (if applicable). Also, perform an audit of yourself to see what skills you have, what experience you have in any field of employment and what kind of emergency jobs you can take until you find your career work again.


It’s time to do without that supreme cable package, that VIP gym membership, that subscription to Playboy or that weekly trip to the movie theater. In a time of need, these are not necessities to your daily living. When funds are scarce, it’s pertinent to distinguish what you need to live and what you don’t.


You put off de-cluttering your home long enough. What better time than to do it now? Get rid of junk you don’t need and sell it on Craig’s List, Kijiji, eBay or hold a garage sale. Every little bit of cash helps.


Make a list of what’s the most important bill to pay. Of course, your rent or mortgage is always No. 1 then food and transportation. If you have credit card debt, it’s not a big deal if you miss a payment or two because you’re main priorities are a roof over your head, food on the table and finding a job.


Speaking of credit cards, never, under any circumstances, use your credit card when you’re out of work. If you think the solution to your problem is to use that $2,500 line of credit and then pay it off when you’re employed will not suffice. Credit cards and loans are your last resort.