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When you lose your job, have an honest and frank family discussion about the nature of the finances of the family. Include all children in the family except those that are too young to understand what is happening. Everyone in the household needs to understand that sacrifices are necessary to pool resources of the family. Each person should contribute whatever they can, contributing meager savings, giving up allowances, foregoing new clothes, increasing chores, assisting younger siblings with school work, etc.
Eliminate Unnecessary Payments
Gather a hard copy of all of your credit card statements, and banks statements. Review them carefully to determine if you are making recurrent payments on things you are have not used in a long time or do not need during this pandemic. Cancel any magazine subscriptions, gym memberships, premium music and video streaming service that you don’t use or those that you don’t need while your finances are limited. Downgrade your cable, internet, and cell service if possible. Stop any recurring charges for donations to 401C3 charities until after the pandemic, especially if you are cash strapped.
Eliminate Additional Car Expenses
If you are a multi-car family, consider parking all of the cars except one that is used for essential travel. Suspend the auto insurance on the other vehicles until it is necessary to drive more than one at a time.
Eliminate Extravagant Wants
In economic good times, we spoil ourselves. We eat at fancy restaurants, see the latest shows and concerts, travel to exotic destinations, buy fancy designer clothes, etc. But none of these things are necessities. Due to various shut downs and travel restrictions we can no longer do some of these things. Now is the time to scale back spending to true necessities. Is that daily $5 latte at the driver-thru coffee shop really a necessity?
Consider Alternate Sources of Income
Evaluate your skill set and abilities to find additional employment, but be realistic. With much of the economy shut down there are not many options for earning extra income. It is more likely that you can trade or barter some specialized product you can create or some specialized service with other individuals that have some product or skill that you do not possess. Most everyone that is unemployed is short on cash.
Unless you have some priceless antiques, do not believe you can raise cash by going through your garage and basement and selling unused items. Prices are now depressed for everything, except PPE. Today, for the first time in history, crude oil futures are in negative territory. There is a glut of oil on the world wide market, driving the price of oil down. There is now a glut of stored toilet paper in people’s garages and basements, do not expect to make a profit by trying to sell toilet paper.