Recovering your finances after a period of unemployment can result in additional stress – on top of the adjustment and learning phase related to the new employment. Fortunately, there are ways to come up with a short term increase of funds until your paychecks begin taking up the slack. The following guide can help you get through the first month or two as you become accustomed to the new paycheck.
Figure out your real earnings
Before committing to make payments on any outstanding debts or taking on new debts, make sure you know what to expect from your paychecks. This means checking your tax withholdings with the human resources or accounting department. You also need to make sure there are no extra withholdings. For example, some employers may deduct the cost of your uniform out of your first paycheck if it is your responsibility to pay for it. If necessary, wait until you get your first check to ensure there are no surprises.
Create a catch-up plan
Once you know your earnings, take the time to figure out what your minimum living expenses are, including both bills and variable expenses like food and gas. Then, divide these monthly expenses between the amount of paychecks you receive each month. Whatever is left over can go towards catching up. It's a good idea to leave yourself a buffer of a little bit of extra cash instead of throwing it all at catch-up payments.
Call your creditors
Now that you know how much you can put towards past due bills each paycheck, take the time to call each creditor with which you are behind. Offer to make payment arrangements that fit into the budget you made. The key is to pick a realistic amount and to stick to it. If you can only throw $5 at the bill each week, don't let them cajole you into paying $6. You will fall behind again. Many creditors will likely work with you because they recognize that any payment is better than no payment.
Make plans for the outliers
There may be a few outliers that won't accept partial payments. If this is the case, then you need to get creative. If you have items you can sell to pay them off, then this is your easiest choice. Otherwise, consider a payday loan from a company like Payday Express. Although qualification varies between companies and state regulations, these loans generally don't perform credit checks – you just have to have proof of income and a bank account. The loans are high interest and short term, generally needing to be paid back by your next paycheck, although many allow you to restart the loan by simply paying off the interest.
To make these work, take on a loan no larger than either what you can pay back by your next check, or at least one with payments small enough that you can cover both the full interest and some of the principal with each payment. You can then use the loan to pay off the creditor while setting aside the catch-up payment portion of your check for paying off the payday loan as soon as possible.
By acting proactively, you can prevent the financial troubles from your unemployed days from continuing to affect you after you have a job again.Share