What Unemployment is Teaching Me

What Unemployment Taught Me
Lessons for the average middle class American

My husband is the breadwinner in the family, bringing home a decent salary. I work outside the home as well, but only 10 hours a week. We live a fairly frugal lifestyle. We have basic cable with no frills, modest vehicles, both under $20K when purchased and a modest suburban home. I keep my AC up in the summer and all lights off when not in use. We like to eat out, but try to keep the cost down by ordering water and splitting meals when possible. I especially hate to waste money, and try to cut back whenever possible. This can drive my husband crazy sometimes; but we have come to a happy compromise over the years.

My one downfall is that I don’t save near enough money. So late in 2008, I decided 2009 would be our year. I worked out a budget, a savings plan, and a debt consolidation plan. I was very proud of this budget. I put lots of love and careful consideration into planning this budget. We started 2009 with a bang. We stayed on budget for 13 days; then my husband was laid off.

I looked at our budget and started cutting out luxuries. I contacted my credit union that held one of my auto loans. I told them my situation and they allowed me to waive my payments for 3 months. They would simply tack those months onto the end of the loan. Next I called my gym. I told them my situation and asked if they could waive my membership dues for 3 months. I explained that I didn’t want to cancel because exercise was the key to helping stress. I sent them a copy of hubby’s termination letter and they waived my fee. I was on a roll.

I then contacted my phone/Internet/TV provider. I had a bundle package, so it was easy to make one phone call for this. First I talked to them about my Satellite service for TV. I wanted to cancel it all together. After all, TV is a luxury, not a necessity. The kind gentleman on the phone explained my options; including lowering my service to a very basic plan (only 22 channels) for $10 a month. When I continued to decline, he gave me the basic plan for FREE for 4 months. I accepted. He then transferred me to the phone area. We had to keep our home phone because we don’t carry cell phones. GASP. I know most people consider this a necessity, but we have pay as you go phones for emergencies and it only costs us $50 a year per phone. Anyway, I was able to knock off a few options we never used and saved $10 a month. I decided not to change our Internet service since hubby would be using that for unemployment reporting and job searching.

So, after saving us $509.00 a month for the next 3 months, I was able to make a new and improved unemployment budget. I figured in my small income and unemployment wages and realized we could live for about 5-6 few months. Thanks to my AWESOME credit, I was able to apply for a 0% credit card for transfers and transactions for 12 months. I figured we would use that for items like groceries and gas. Our incoming cash would cover the mortgage and utilities and one car note. Fortunately, one car will be paid in full in two months. This is the first car we have owned in 14 years that we paid off. What a great feeling.

So, with all my hard work, I was feeling pretty darn good. Then my daughter got sick. Ironically, I received the COBRA paperwork on the same day. Gulp. I slowly opened the package; knowing it would be bad. Okay, so it was worse than bad, it was devastating. COBRA would cost us hubby’s entire unemployment; $1400 a month. Panic starts to set in. But wait! Maybe I can look into an individual family plan. We start researching and realize that if we go from a group plan, to an individual plan and back to a group plan when he finds a job; the new insurance at the new job can deny claims based on pre-existing conditions. Unfortunately, 3 of the 4 of us have pre-existing conditions. Those %!# companies have got you one way or the other. So, I start to look at the budget again and the real sadness kicks in. We will only last 2 months, maybe three.

Now I realize that I can find a full-time job. It’s just really hard to face reality when I have been really enjoying my time home with the kids. Not to mention the benefits my kids see as well. I hate to turn the kids world upside down along with ours. It’s hard to give up so much and to give up that as well. Plus, when I get a full time job, it’s tough to leave my great position at my current company. Last but not least, when hubby finds a new job, I will be quitting the full time job so we don’t have to put the kids in day care. It’s hard for me to take a job, knowing I will be quitting at my earliest convenience. But I will do what I have to do.
So, here we are 3 weeks into unemployment. Hubby has had 1 interview. The market is terrible and although he’s talked to every recruiter known to man, the jobs just aren’t there. We will survive. I have no doubt about this. We are workers and will do anything to make ends meet. The hard part will be digging ourselves out of the financial hole we are creating by using credit cards right now.
My advice to all working Americans right now is this: SAVE SAVE SAVE. Look at your budget and cut back where you can NOW. These luxuries can always be added later on. Start trying to put 8 months living expenses into a savings account. Make sure you budget in COBRA insurance. Every little bit you can save now will help in case something happens to your job. Best case scenario is that you keep your job, and you have a nice little nest egg. You can use that money for emergencies, vacations, or just keep it there for continued security. I have heard this for years, but never really took it seriously. I sure regret that decision now. Unemployment is stressful. Finding a job is stressful. But let me tell you, and I hope this doesn’t happen to me, watching your credit tank because you didn’t plan ahead will be really stressful. That is a decision that will haunt you for the next 8 years.