What You Can Learn from Unemployment

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Learn from Your Unemployment

Learn from Your Unemployment

Any period of unemployment is tough. You’re not sure how long it will be until you find another job or how much you will make when you do. You’re following your finances closer than ever before. But once you get out of the woods, you may find that there are many lessons you learned that you can carry over to the good times too. They can make any future bouts of unemployment less stressful and even make you richer in the long run.

You can live on less.
Whether you’re drawing from a savings account or relying on those unemployment checks, you’ll find ways to cut corners that you didn’t expect, and you may learn that you don’t miss some of the things you considered “necessities” before. By continuing a few of these cost-saving measures even after you receive a regular paycheck, you’ll be able to save more and pay down more of your debt.

You need an emergency savings account.
You can’t limit your savings to IRA and 401(k)s because the unexpected will happen. It makes life a lot easier if you have a little cushion to fall back on. If the idea of saving up for three to six months worth of living expenses (as many experts recommend) seems impossible, don’t worry. The truth is that any amount helps. Set up your savings to be automatic with every paycheck, so you don’t have to think about it. You’ll appreciate it the next time an emergency comes up, whether it’s a job loss or an unexpected large expense.

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Rice, pasta, and oats are delicious food options.
Food is a big expense, but it’s also one of the easiest to control. By cooking at home, you can cut down significantly on what you spend and by taking advantage of inexpensive foods such as rice, pasta, and oats, you can get a lot of bang for your buck and still eat delicious, nutritious and easy meals.

Debt holds you back.
Even in good times. Yes, some types of debt, such as home loans, have tax benefits, but most other forms are best to be avoided, such as credit card debt and car loans. If you aren’t tied up in paying back loans, you’ll have more available cash to use when you don’t have any income coming in, but you’ll also have extra cash during the good times to build up that emergency savings account and to spend on things like travel and new gadgets.

Your greatest asset is good health.
If you get sick or become injured when you’re unemployed, you’ll not only incur the costs of solving your health issue but also may be unable to focus as much on finding a new job. So take care of yourself! Exercise, eat well and make regular visits to your doctor and dentist. Remember the old adage: an ounce of prevention is worth a pound of cure.

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