The unemployment rate has fallen dramatically in the past few years. But the memory of the latest financial crisis still lingers. It’s wise to recognize that there’s no such thing as true job security.

You could find yourself unemployed after being gainfully employed for years. After the shock settles in, you need to accept that it could be a while before you find work again. Until the next job comes along, you’ll need to manage your money well. After all, money has stopped coming in. But the bills still need to be paid.

Here are seven tips to help you determine what to do when you’re unemployed:

1. See How You’re Spending Your Money

When you have a reliable source of income, it is easy to ignore where and how you spend money. You know your major expenses are covered and another paycheck is coming soon.

Well, now is a good time to really examine how you spend your money.

If you don’t already use an online budgeting tool, you’ve got a couple of options here:

  • Start using a free budgeting tool online., for instance, will import some of your transactions retroactively. You’ll be able to see how you’ve spent money for the last month or so in just a few minutes.
  • Gather your paper receipts from the last several weeks and total your spending in different categories.

Related: 8 Budgeting Moves to Make for 2022

The goal here is to figure out what you are spending. You can only determine what you should be spending once you’ve learned where your money already goes.

As you’re working through this process, separate your essential spending from your non-essential spending.

Essentials would include things like your mortgage, possibly your car loan (if you need it to get to job interviews), basic food and gas expenses, utilities, etc. Non-essential spending includes unnecessary new clothes, dining out, going to the movies, etc.

Related: How to File For Unemployment (And What It’s Like)

What about those expenses that are somewhere in between, like paying down debts?

Ideally, you’ll make it through this period of unemployment without wrecking your credit score. This means making your minimum payments on time, as much as possible. Figure out your monthly obligations for all your debts, and we’ll talk in a minute about how to deal with them.

Related: How to Develop the Habit of Spending Less Than You Make

2. See Where You Can Cut Back

Now isn’t the time to try to keep your cable and expensive cell phone plan. Instead, you need to cut back on expenses as much as possible. The more you can cut back, the longer you can get by on any savings or lines of credit you have available.

Start by cutting out the items that are completely unnecessary: cable or satellite, dining out, other expensive entertainment, manicures and pedicures, non-job-interview clothing expenses, etc. Then, see where you can cut back on necessary but variable expenses. Here are some examples:

  • Groceries and household items: So you’re used to shopping on the fly at expensive specialty grocery stores? Making a meal plan, shopping at cheaper stores, and clipping coupons could be helpful. Even if you don’t normally spend a fortune on food, chances are you can cut at least a few bucks a week out of this portion of your budget.
  • Clothing for interviews: Sure, you need to look snazzy for your upcoming job interviews. But could you find what you need already in your closet? Or consider borrowing a suit from a similar-sized friend or relative. Another option is to buy your clothes secondhand from high-quality thrift stores, even online ones like thredUP.
  • Transportation: If you currently have a hefty car payment, consider selling the vehicle and getting into something cheaper. With enough equity, you could trade in your expensive vehicle for one that has no monthly payment. But even cutting your monthly payment by $50-$100 helps.
  • Try to cut your other monthly bills: Could you save on insurance? Essential internet services? Your cell phone bill? Probably. Now is the time to start shopping around for new services. Or call your current service provider to determine how you can save.
  • Put payments on hold: Are you paying on federal student loans? You can probably apply for forbearance to put your payments on hold while you look for work. Even some private student loan lenders will extend this option if you’re out of work. Other creditors, such as your credit card companies, may work with you on lighter repayment terms. They’d rather you continue to make payments than default on your loans and file for bankruptcy!

Resource: 4 Budget Types and the Best Tools for Each One

Once you get started thinking about ways to cut back, you can probably find loads of them. Can you save energy? Could you use public transportation to save on gas? What about saving on childcare? Find as many ways as possible to save sooner rather than later.

3. Take Advantage of Available Programs

Maybe taking advantage of government programs isn’t your cup of tea. But these programs are in place for just such a time. Find out what’s available to help you through this time, and tap into those resources.

One option may be to negotiate a severance package with your employer. Depending on the circumstances of your job loss, this may be possible. You may not be able to negotiate for a huge amount, but every little bit helps.

Of course, you’ll want to look into unemployment right away. Getting unemployment can take a while, so apply as soon as you lose your job. Other options include the home loan modification program, which can help you stay in your home through this time. Again, this can be a lengthy process, so get started quickly.

What if you’re really tight on cash and have no savings? In this case, apply for additional assistance, such as SNAP benefits (a.k.a. food stamps), government-funded healthcare, and any other options you can think of. You might even look into local charities that can help you feed your family while you look for work.

4. Consider Adding a Renter or Roommate

If your home is large enough, adding a roommate to share your expenses can be a way to relieve the burden right now. This won’t work for everyone, of course. But even if you have a family, you might be surprised to find that a friend you’ve known for years is happy to move in. It’s a win-win after all. Your new roommate could get a much lower monthly rent, and you get money to help pay the mortgage and utilities.

Another option is to try Airbnb. This home-sharing service could pay your mortgage and then some if you’re in a hot area. You can even use it to list your whole home for just a weekend or two a month. Depending on where you are, one weekend could net you $300-$500 or more in income…just for vacating your home (and cleaning it up really well) once a month!

5. Find Part-Time Work

Once you cut your budget to the bone, you might be surprised how far a part-time job can carry you while you shop for full-time work. You might not want to turn waitressing or bartending into a career, but it could help you get by.

Another option is to connect with local temp agencies. You may be able to find better-paying contracts or part-time work in your actual field of expertise. These jobs may turn into actual long-term, full-time employment.

Alternatively, look for ways you can use the gig economy to your advantage. For instance, if you have a decent vehicle, you could drive for Uber or Lyft. Or you could consider launching a part-time career as a freelance writer. Consider other options, too, like cleaning homes, running errands for people, or even cooking meals in people’s homes.

You might be surprised to find you love your part-time work, and it could turn into a new career. But even if that doesn’t happen, earning as much money as possible now will get you through this period with fewer financial scars. Plus, these options give you new ways to diversify your income. This is one of the best ways to hedge against future job uncertainty.

Just remember: the goal should always be to wind up with steady, full-time work. So don’t let your part-time jobs get in the way of aggressively applying for jobs and tackling interviews as often as they come!

6. Think About Taking a Loan

What if you don’t have much in savings, but you have good credit? In this case, you may want to consider taking out a loan during this period. It’s only a good idea if you don’t have a lot of debt already, though. Otherwise, you risk making your monthly payments unmanageable in the near future.

One option if you have equity in your home is a home equity loan. This can give you a lower interest rate. But if you don’t want to put your home at risk, consider a lower-interest personal loan, if you can qualify.

Here are a few keys to making this work for your needs:

  • Apply quickly. Getting a loan when you’ve been out of work for a while is tough, if not impossible. Unless you can rely on a spouse’s credit history and current income, you may be out of luck unless you apply right after you lose your job.
  • Only spend what you must. The ideal loan in this situation is a line of credit, which you can use to spend only what you actually need to spend. Even a credit card with a 0% introductory rate for several months could fit the bill. Just be sure you’re only spending on absolutely necessary expenses.
  • Factor in the new monthly payment. When you’re calculating your unemployment budget, factor the loan’s monthly payment in, as well.
  • Be careful what you risk. All too many homeowners had large home equity loans in the last housing downturn. When home prices tanked, they were suddenly underwater on their home–sometimes by tens of thousands of dollars. This makes it almost impossible to sell your home should you need to move to take a new job. So think twice when you put important collateral on the line for a loan like this.

7. Be Prepared for Next Time

Hopefully, you already have an emergency fund when you get laid off. If not, once you’re back on your feet, immediately start preparing for the next possible emergency. If you haven’t already, save up three to six months’ worth of expenses in an emergency fund.

Even if it takes you more than six months to find another job, you can often stretch that savings and a part-time job to a year or more. As soon as you can, start saving money again for the next emergency.

Related: Where Do People Keep Their Emergency Fund?

Losing your job is never fun, especially when you don’t expect it. But these steps can help you get control of your money so that you come out on top of this life experience.


  • Rob Berger

    Rob Berger is the founder of Dough Roller and the Dough Roller Money Podcast. A former securities law attorney and Forbes deputy editor, Rob is the author of the book Retire Before Mom and Dad. He educates independent investors on his YouTube channel and at