As many of my readers may have picked up, I do lots of work with â€śdislocated workersâ€?. Thatâ€™s a fancy term for people whose jobs have been shipped overseas. The county where I live has an unemployment rate over 8% most of the time. Iâ€™ve seen it as high as 13%.Those are the â€śofficialâ€? numbers.
Sometimes I wonder how accurate they are.
One of the most devastating things about a lay off is the financial impact.
What lead me to make this post is that the “Thrify Scot” website was soliciting comments about money from bloggers.Â
The site offersÂ Debt Advice and it reminded me of some very real people whose lives were overwhelmed by the impact of debt and a lay off. Thrifty Scot is a UK site… but I assume folks in the UK have debt problems tooÂ and have to deal with the issues related toÂ Credit Cards, Remortgages, etc.
As I said, the most destructive effect of a lay off are financial ones. We all tend to spend as much money as we make. So when we’re maxed out on debt, have been lazy about refinancing and saving money on interest, when we haven’t paid down our debt, etc… a layoff basically ruins us.
It’s really hard when a family all works at the same industry and all the jobs are lost the same time. When at least one person is able to continue working, at least there’s a chance to maintain a relatively normal life. But when everyone is laid off simultaneously… things can get grim fast.
The last lay off I’m familiar with found families being asked to pay $1800 per month for health insurance. They were only getting about $1,000 for “unemployment insurance”.
The most fortunate ones had paid down their mortgages, paid off car loans, restructured their debt when times were good. Some even had some extra cash flow streams created.
Before a layoff hitsÂ you, are you getting your finances in order? Even paying off a few dbets will free up cash flow that could make the difference if you lost your job.
Think ahead. Plan now! Get the Debt AdviceÂ you need while you have time to react.Â
Note: Thanks for Thrify Scot for sponsoring this blog post.