According to statistics, the unemployment rate decreased by nearly 7% since April of this year. And while this is great news for all Americans, it still means that millions of Americans are out of work.
Fortunately, due to the pandemic, the United States government released pretty generous unemployment benefits for those left without work.
Make the most of every penny you get while on unemployment during the pandemic. Here are some tips to make smart investments and avoid unnecessary debt while unemployed.
1. Reduce your Expenses
One of the most effective actions you can take while on unemployment is reviewing your bills and reducing your expenses. While some bills, such as the light and water bill, are essential, certain expenses are noncritical.
Make a list and review what is considered a luxury. This can be something small like a gym membership or something large like giving up your car. Whatever it is, understand that this adjustment is only for a small period of time.
2. Seek a Part-Time Job
Want to continue collecting unemployment but increase your income? Consider getting a part-time job! Because of the pandemic, a lot of states shifted their requirements for those collecting unemployment.
One of those requirements? Reduction of hours. If you were let go of a full-time job, you could collect unemployment even if you get hired at a part-time gig. Fortunately, some companies can tailor your resume to fit the exact career applying for.
3. Do Not Touch Your Retirement Savings
One of the worst things you can do during the pandemic is spending your retirement savings. Because 401k withdrawals come with a pretty substantial withdrawal fee, this can end up costing you more than you think.
Fortunately, some plans allow an early withdrawal due to hardship such as unemployment. But many times, these eligibility requirements are hard to meet. Your best bet is to leave your retirement account alone.
4. Call Creditors
Let's face it. Stress levels can increase when you owe money and don't have a steady income. Even though it can be pretty intimidating, creditors can oftentimes give you various options when it comes to paying back your debt.
Don't be afraid to ask for a deferment or if there is an income-restricted payment plan that is available to you.
5. Budget
Although it sounds juvenile, budgets work. You will be surprised how much money you are actually spending when it is all written down on paper. Consider composing a reasonable budget that consists of your needs, your savings, and your wants.
Unemployment Tips and More!
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