4 Tips to Manage Your Finances When Faced with a Layoff
The Canadian economy is in a recession and there are uncertain times for many. Low oil prices and the change of both Provincial and Federal government leadership has had a tremendous impact on the economy, resulting in many layoffs in 2015.
More layoffs are predicted in the upcoming months. What happens if you have lost your job or are faced with a huge income cut?
Losing a job or facing an income reduction is an emotional time when many are already living pay check to pay check.
Step out of the ‘Deer in the Headlights’ trance and be proactive on your finances.
Here are 4 tips that can help you manage your finances and keep your credit score from being negatively impacted:
1) Make a plan & Make a budget
What are your fixed costs and what unnecessary items can you reduce or eliminate from your budget? Develop a budget of your mortgage/rent payments, utilities, loan payments and allocated funds for groceries, etc. It may mean cutting out the ‘extras’ like a cable package or ordering out. It’s time to live within your means.
2) Call your Mortgage broker or Financial Institution
Often banks/lenders have a miss a payment option with your mortgage. If they don’t, let them know your situation and see what other payment options can be made. Being proactive and communicating will help avoid unnecessary mortgage default payments reporting on your credit bureau. Mortgages are now reported on credit bureaus and if there are missed payments recorded on your credit bureau, it will impact your future lending needs.
Key thing- Talk to your mortgage company before a NSF payment happens.
3) Credit Cards
Make your minimum payment on time! Call your credit card companies and
let them know the situation you are in. If you can’t make your minimum payment, negotiate a different payment. Credit card companies are willing to work with you if you contact them ahead of time. Several credit card companies have a balance protection option on their cards. Contact your credit card company and see if you have that option. Often they will cover your minimum payment if you are unemployed. Take advantage of this before you miss the payment.
4) Contact your Utility companies and set up equalization payments
Many utility and municipalities offer an equalization program. This helps spread higher winter utility costs over the summer months to fit tight budgets.
For more information or for a free mortgage review, contact Jacqueline Jeffries at 780.220.5968 or email us.