In December, I shared a guest post that provided 10 essential steps to take before you’re laid off. But what if it’s too late? What if you’ve already lost your job? In this economy, more and more people are facing that situation, including long-time GRS reader Allen. He writes:
I was laid off yesterday. If it weren’t for Get Rich Slowly, I wouldn’t have any money set aside. As it is, I have a small emergency fund.
For the past 3-1/2 years, I’ve been a quality assurance engineer. Before that I worked at Best Buy. Before that, I dropped out of college. In this job market, I cannot easily find a job in my field; all of them require a college degree, regardless of experience. To this end, I’m thinking about finishing my degree. I’m 28. I haven’t been in school for half a decade. My study skills are rusty.
I’ve been trying to focus on the positives because the alternative isn’t helpful. I will get back on my feet, but I don’t know how I’m going to pay for my home and car in the short term. If I do go back to school, I might have to work full-time, too. I know people have done more with less, but that doesn’t make this any easier. I also have a lot of questions:
- How do I contact ex-bosses (or ex-coworkers) for letters of recommendation?
- How do I politely ask lenders if they might be willing to suspend loan payments without affecting my credit score?
- How can I move from an already thrifty existence to something more meager?
- I want to roll my 401k into an IRA. Which company should I use? Vanguard?
This is all new to me. I know people have been laid off before — even my father was laid off three times when I was a boy — but this is the first time it’s ever happened to me. What next?
I’m a fan of education, and I applaud Allen for considering this route. But I think he needs to be cautious of new debt while doing his best to manage the debt he currently has. If he’s already living a frugal lifestyle, there’s not going to be much room for him to cut further expenses. (Can he give up the car?) That means his top priority has to be generating additional cash.
For now, I believe Allen should do what he can to bring in some sort of income — any income. Pick up a short-term job, even if it seems like a dead-end, but don’t let it become permanent. Better yet, seek help through a temporary agency. (When I was working at the box factory, we often found great future employees through temp agencies.) But I’ve never faced this situation before, so this purely theoretical advice seems inadequate.
Have you been laid off? How did you handle it? Do you have general advice for Allen’s situation, and for others who might have lost their jobs? What about his specific questions? How do you cope with a layoff when you already live frugally, and when you still have debts to pay?
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I dont think you should be afraid to go back to school because your study skills are “rusty”. I went back to school after 7 years and had to jump in with calculus after not doing even basic algebra for that length of time. It was A LOT of work for the first half of the semester, but it all came back to me.(I told the professor my situation and said that I would be coming to his office hours all the time and he was okay with that and was very helpful to me). You will be surprised what a little hard work can do to get your skills back to the norm. It took me 2-1/2 years once I was back at the university to finish my degree.
Re: Financial Aid – I know my school has scholarships specifically for re-entry students. They even have a re-entry office dedicated to helping students making the transition! So I would definitely check into that to see if your potential school has some sort of similar service. Their office was a great help to me in the beginning when I needed advice. And I also met a number of other students who were working fulltime and going to school fulltime. They pulled it off by scheduling their classes (if possible) for MWF and working T/Th or vice versa. It definitely can be done! And you may get less for financial aid this year because you have worked in your last tax year. But next year (if you stay unworking), you will get so much more financial aid which is a big help. At least it would be something!
Good luck!
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I only got about half way through the comments, but I didn’t see one idea that could help Allen.
I work at a state University, and one of our employee benefits is free tuition. Check out your local University and/or community college to see if they offer this.
At our Uni, every job class gets this benefit for themselves, spouses, and children. So, you could conceivably work for food services or janitorial or the IT help desk, and finish up your degree.
As others said, though, really think about what you want from a degree – they are not all created equal. In my field, they’re worthless without experience. In engineering, on the other hand, it might be the other way around.
Last, take a look at unemployment statistics in various places and evaluate how firmly place-dependent you are. Maybe moving isn’t worth it to you; maybe it is. But, call your state’s Department of Labor and talk to their research folks – I’m pretty sure every state has a projection of the “hot jobs” for the next decade. Get the real picture on your field and your area and factor that information into your decisions. There’s no sense in getting a degree in a field that’s projected to be obsolete in 10 years.
Good luck!
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First, get onto Social Web Sites and hunt for your ex bosses….DONE.
Second, get onto these Social Web Sites and hunt for your buddies that you are not already in touch with, and ask them for help. This is where Pride is less than Desire to find a job.
Third, get onto Job Clubs and seek help by meeting them in person. These are clubs going on everywhere. I used to part of one in Chicagoland.
Fourth, hunt for a job, like a job. 8 hours a day, 6 days a week.
Fifth, contact 3-4 new Recruiters in your field per week, and meet with them. This sounds easy, but I am not saying emailing resumes to recruiters. I am saying find the right 3-4 each week, and then get on their case everyday until they line up interviews.
Sixth, make 3-4 versions of your resume and cover letter and apply for jobs AGGRESSIVELY.
Seventh, make a ‘presentation on why someone should hire you’. Put it in a binder that you can use to ‘Sell Yourself’.
Eight, do NOT give up. This is a JOB, and Jobs are NOT Easy (are they?)
Ninth, rehearse in front of a mirror or camcorder on how you interview. It will reveal MANY facts about you about why you are not being hired (if that is your issue).
Tenth, get your family working for you, in finding their friends and contacts to give you a ‘free job with their best contact’ i.e. try me before you buy me for a paycheck.
Can you do this? Write to me (kenny1924@gmail.com) when you find a job using these 10 techniques. These are ALL my own techniques, but I know how hard it is since I used to run Job Clubs in 1999-2003 and that was also a hard time, like it is now.
Kenny
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The hardest part for me being laid off a few months ago was the fact that you have to stay positive. No one is going to hire a “gloomy gus.” When going for interviews you need to remember that you are now a salesperson who is trying to sell themselves to the company. Would you buy any product from someone who seems depressed? I know I probably would not. Unemployment is an easy way to slip into depression especially for men, because they tend to equate their self worth with their jobs. Hang in there and stay positive.
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Unemployment Benefit should cover most of your expenses. Currently, there is even an additional $25 weekly benefit.
http://www.dwd.state.wi.us/uiben/apply.htm
I would think you would be qualified for the max at $1552 per my calculations. This is one of your best options.
To find your old bosses: http://www.linkedin.com or google.
IRA: I use http://www.fidelity.com
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When it comes time for the interview, this is helpful. And hysterical.
http://www.howtonailaninterview.com/
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I left my job with the intention of pursuing higher studies, but it took me more than a year before I got an admission into a good college. That one year has been among the hardest times I have been through. I learned a few things -
* Maintain a schedule. I had no idea what to do with my time, after spending so many years under an externally imposed time-table. For the first time, I had time I did not know what to do with.I ended up wasting a lot of it. And that led to guilt, and depression.
* Keep your mind active. Increase the variety in your activities. I started practicing yoga, caught up with my reading list, tried sudoku.
* Keep in touch with friends. I locked myself in a room, poring over books – taking breaks for food and little else. The more depressed I got, the less social I became – leading to a vicious circle. Keeping in touch with other people might have made the experience less painful.
* Be patient. I had been away from academics for so long, I found it hard to use a paper and pen. I spent hours just practicing to read and write on physical books. My math was bad from lack of use. I started with books from high-school and earlier, taking my time – working out problems. I could not concentrate on a book for much time, but I practiced everyday, and I got better.
* Be confident. Every person has a unique skill or capability – bar none. It takes time to find out what you are good at. It can be exciting, surprising, frightening and rewarding. The world has yet to appreciate what you can contribute – forgive its ignorance.
* Financial background. I had spent close to a year gaining financial knowledge before I left my job. My savings gave me the confidence to take risks. I knew I could live a few years on my own.
If you are really in a bad financial situation and are looking to cut corners, I have a few more pointers -
* Reduce eating out. Cooking at home is healthier and often tastier. There are some really simple dishes involving just rice, lentils, cumin seeds and frozen vegetables. If possible carry a lunch box, so that lunch is covered.
* Make a shopping list. Dont buy things you dont need. Buy bulk, reduce visits to the mall. Buy refurbished.
* Prioritize. Don’t obsess with bargains. I can easily waste hours looking for bargains on items I am not going to buy. Figure out what the really big spends are, focus on those alone. You need to spend time wisely – the first priority is getting a job/admission.
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I’m laid off too and looking at entrepreneurship (starting a distribution company and my own urban farm) as the solution. But I’ve been through it before and found regular jobs, too.
Getting through unemployment with a positive outlook and practical solutions is pretty much the topic of my entire blog: http://www.redefining-unemployment.net/ Sorry for the shameless plug, but seriously, I’ve got several articles on the topic there.
As to the specific questions:
* How do I contact ex-bosses (or ex-coworkers) for letters of recommendation?
Just ask them! You may be able to find them on Linked In or other social networking sites if you’ve lost track of them. Say hello, ask how they’ve been doing, remind them of a few things you worked on together successfully, and then ask for the letter. If you had a good working relationship, most people will be happy to help and may even hook you up with an opportunity they know about.
* How do I politely ask lenders if they might be willing to suspend loan payments without affecting my credit score?
It depends on the kind of loan and the situation the lender is in. The most important part of an inquiry like this is to make sure you are asking the right person. If you call and get customer service, make your request politely. If that person can’t help you, go up the chain of command until you are talking to someone who can actually make those kinds of decisions. It’s likely you’ll have to send in actual paperwork, be prepared for red tape. Have ready documentation of your good credit history and prospects, and have a couple ideas of the specific terms you’d like to negotiate, such as a payment plan over a set period of time.
* How can I move from an already thrifty existence to something more meager?
First – do you really know what you are spending and that you are indeed being thrifty? If not go back a few months and look at your bank and credit statements. See if there is fat to be cut.
If not, you need to set some serious priorities. What are your major expenses?
- Utilities – Seal off a portion of your house if heating/cooling is a major expense. Take short showers. Do not water the lawn. If you garden, use drip irrigation. Hang the clothes to dry.
- Cars – if you have multiple cars, drop insurance on all but one. Drive less. If you have a big car payment, see if you can sell the car or trade it in for something you can afford.
- Housing – Is there any way to move somewhere cheaper or get housemates? If you own your home you may do well to rent it and then rent something cheaper yourself. Even if you take a small financial hit to do that on the mortgage it’s sometimes possible to make that up on your own rental costs. These are just a few ideas.
- Food – Grow your own at your place or a community garden. Look into local food banks and food stamps. Don’t buy premade crap.
- Hobbies – make your hobbies pay for themselves. This is the perfect time to spend more effort and energy on projects that bring you a sense of accomplishment and joy, but make sure that you can get some monetary value back out of them through teaching or selling your wares, or saving money in other areas.
* I want to roll my 401k into an IRA. Which company should I use? Vanguard?
I don’t know about this one – I’m trying to figure it out myself and haven’t decided yet.
I hope you’ll check out Redefining Unemployment – there are articles about finding emergency employment, getting all the state and fed help you qualify for, prioritizing spending when you are living off savings, and more.
-Joy
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Allen,
I am on unemployment; it’s not much, but it is a blessing. Please apply asap; you put your money into the system, time to take back! Trent on the simple dollar has a lot of good frugal meal advice. The Dollar Stretcher is a wonderful website, too.
hang in there. (smile)
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