Cheap Living Tips

It has been over twenty years since I have been in a position of not having a job, so if I was going to share my personal experiences on this subject, it would not be worth taking your time to read it. Friends and family, all around me, are facing this challenge though, so I think it important to include a post on this subject. Philip Brewer, a former software engineer, has written an exceptional article on the subject which you can read for yourself on the Wisebread forum.

In this first of a four part series, Brewer outlines a strategy for taking control of the situation at the very beginning. His no nonsense approach tackles the hard question of modifying our spending habits and budget planning before the money runs out. You often hear that you should look for that one nugget of value in anything you read. For me, that nugget in this article is “spending needs to be taken off automatic.”

This key phase triggers a second look at how much money goes out of my account each day that I up till now have paid no attention to. I am a great fan of automatic payments. I don’t like to be bothered with bill paying so if I can set a payment up to be made directly to the utility company or department store, I’ll do it. By doing this, I think I have saved a bundle in late fees and interest charges.

A closer look, also reveals numerous monthly payments going out for items that might not be essential and could be eliminated to reduce the budget. Do I need to continue that book club or online membership? When was the last time I logged in or read one of those books?

The second topic Brewer covers exceptionally well is setting out a financial plan. Do you know how much you need to meet your current living expenses? Even more important, if you cut those expenses to the real necessities, how much will you need to just get by? Pick a spot somewhere in between that you can deal with and project your needs into the future. Can you survive for six months without a job? I don’t know many people who could.

Brewer’s article recommends staging the job hunt. He suggests putting together a PLAN which studies prospects and time frames and takes a serious look at when it might be necessary to lower your sights and start applying for jobs in other fields or pay levels. It’s a hard lesson but well presented.

Third in Brewer’s list is the need to analyze your assets. What do you have that you can sell to increase your available cash when necessary? He notes that you need to be realistic about how quickly you can get cash from the assets. Stocks may have a quick (if less than satisfactory) return but selling a boat or car may take months.

Brewer’s last point and most critical is don’t wait until the money runs out to look for solutions. Analyze where you are now, make a plan for stretching what you have as far as possible, stick to it. With plan in place, you can start your job hunt with a little more ease of mind.

Technorati Tags: job hunting, living on less, out of work