How To Survive a Furlough

By Miriam Caldwell

If you are struggling to make ends meet, and stick to your budget, then your entire system is going to be thrown off when you are forced to take time off without pay. Furlough usually happens for a week or two, and it is not long enough for you to qualify for unemployment. Additionally, your employer might simply cut everyone's hours by a shift per week. Either option means that you are going to have a pay cut and make up for a budget shortfall. Preparing your finances for a recession will help you prepare to survive a furlough too.

Difficulty: Easy

Time Required: 1 hour planning

Here's How:

1. First, you need to identify how much income you are going to lose as a result of furlough. You may have two weeks off together or one week off a quarter. The furlough may be longer term than that, and if that is the case you should look into the option of applying for unemployment benefits or looking for another job. If the employer is unable to give a set length to your furlough, you should treat it as a layoff and start with your plan to handle a layoff.
2. Once you known how much money you are going to lose, you need to set up a budget that will let you know what expenses you need to cut temporarily and what expenses you need to cut back on now so that you can save the money you need to cover the time you are on furlough. You may need to take your emergency up to $2000 or $3000 dollars in this situation to cover the missed paychecks. It may need to be more depending on your current expenses.
3. If you receive your furlough suddenly and you do not have time to save up money, consider finding quick ways to raise money to help cover your bills. You could pick up temporary work for the week that you are off or you could do odd jobs for others. Additionally you could sell items if you need to raise the money to cover the rent or eat. These solutions are nice, because you get paid for them quickly, and so you should not find yourself going further in debt as a result of the furlough. You may also consider taking on a part-time job.
4. While you are on furlough, you should watch your spending carefully. Often when people have free time, they spend more money by shopping or going out. This is a time when you need to be extra careful with your money. Try finding alternative, free sources of entertainment while you are on furlough. It may be the perfect time to tackle a big project or to take a mini vacation at home.
5. If you find that you will not be able to cover all of your bills for the current month, you need to choose to pay the most important bills first. Then you need to work out a plan that will allow you get caught up on your bills quickly. If this is the case you should look at getting a part-time job that will help you to get caught up. Once you are caught up you should up continue to work until you have a good-sized emergency fund in case you are laid off or have to go on furlough again.

Tips:

1. Remember to keep a positive attitude during this time. You still have your benefits, and a job, even if you are not currently working. Layoffs may be worse. Just be sure to do everything you can to cut your bills down and limit your spending.
2. You can take advantage of a furlough to update your job skills, resume and to prepare yourself for a future job search.