Have you just been made redundant? Doubtless you’re contemplating how on earth you’re going to keep life functioning as usual: the mortgage needs paying, the kids need feeding and the car (somehow) needs keeping on the road.
But don’t worry: you can keep on top of your outgoings and stay out of the red by following these tips aimed at helping you manage your finances after redundancy.
First, find out what you’re entitled to
It’s not always easy to keep on top of our finances, and it’s especially hard when we’re unexpectedly made redundant. However, the first thing to take comfort in is that you might be entitled to statutory redundancy pay. This is set down by law, and means that you’ll be awarded a sum of money if you’ve worked for your employer for two continuous calendar years. You might also be entitled to contractual redundancy pay, which means you’ll be awarded an amount from a pot of money your employer has specifically reserved for redundancy pay outs.
So, start managing your finances by finding out what you’re entitled to, which means asking your employer directly, checking your employment contract and asking Citizens Advice about redundancy pay.
Next, consider applying for benefits
The government or your local authority have some special measures in place to help you and your family. For example, you might be eligible for:
- housing benefit
- council tax reduction
- jobseekers allowance
- help with NHS costs
- free school meals or childcare for children.
You can find out what you’re entitled to by using tools such as the entitledto calculator.
Then, as quickly as possible, get a clear picture of your outgoings
In order to manage your finances and stay out of debt, start reviewing your bank statements to see where your money is going. You’ll need to know what your direct debits are and other commitments that simply must be met, such as food bills, utilities and mortgage payments. Write them into a spreadsheet and identify the financial commitments you can manage compared to the areas you’re going to need to cut back on, discussing it with anyone else contributing to your household income.
It’s worth ringing companies and businesses that you owe money to (such as your mortgage provider or credit card issuers), seeing if you can reduce payments temporarily or just pay the interest if you’re in real difficulty.
If you’re struggling to meet the essentials, consider your alternative options
Perhaps a loan or dipping into your savings account is right for you, or, maybe borrowing some money from a friend or family member is a more suitable option. Whatever the case, redundancy can come as real blow, damaging your confidence and sense of self worth.
However, it’s critical that you don’t bury your head in the sand or ignore the fact that you need to take control of a situation that has been largely out of your control so far. Ultimately, it’s about managing the expectations of people you owe money to, so let the necessary people know what’s happened and see if you can work out an arrangement that works for you while you get back on your feet.
Featured image, by Unknown. U.S. National Archives and Records Administration, Public Domain, https://commons.wikimedia.org/w/index.php?curid=17057587