It takes planning and discipline to build up a savings cushion, but that money can start to disappear quickly after a job loss.<\/p>\n
With thousands of federal government employees out of work in Maryland<\/a> \u2014 and some facing long periods of unemployment in a tough job market \u2014 we talked with financial experts about managing money during a difficult time.<\/p>\n \u201cIt\u2019s not like the pandemic, when there was cash assistance that was coming,\u201d said Sue Rogan, the director of strategic partnerships at the CASH Campaign of Maryland, a nonprofit that promotes economic advancement for low- and moderate-income Marylanders.<\/p>\n \u201cThere isn\u2019t any real dedicated funding to help them with this transition,\u201d she said.<\/p>\n Experts offered advice on how to protect yourself and your family when money is tight, including how to take on debt as responsibly as possible.<\/p>\n \u201cA job loss can be completely overwhelming,\u201d said Sarah Adam, a financial advisor for Edward Jones. It can be hard to make the best decisions when you\u2019re feeling vulnerable and stressed, she said, but \u201cyou can make strategic choices even in this moment of crisis.\u201d<\/p>\n Start planning now<\/p>\n If you are out of work and your job applications aren\u2019t getting traction \u2014 or if you think you might lose your job \u2014 make a financial plan<\/a> before your savings run out. Identify flexible expenses where you might be able to find cheaper options, like car insurance or internet providers, and reduce nonessential expenses like DoorDash.<\/p>\n \u201cThis is the time to make sure they\u2019re watching every dollar getting spent,\u201d Rogan said.<\/p>\n Think creatively about new ways to bring in money, like an online side gig (just watch for job scams<\/a>) or selling belongings you no longer need. Rogan said she spoke to one man who is selling his vinyl records.<\/p>\n If you\u2019re able to put money aside in savings, Adam advises placing it in a high-yield savings account so that it earns as much interest as possible. A financial advisor can help you explore options with higher returns, such as a money market fund. <\/p>\n You can find a list of certified financial planners offering pro bono or reduced-rate services to federal workers at the CFP Board<\/a> website.<\/p>\n Take advantage of benefits and other assistance programs<\/p>\n There\u2019s help out there, and you should take advantage of it, Rogan said. Some federal workers she\u2019s spoken to felt they didn\u2019t need to apply for unemployment if they relied on their savings or a modified spending plan, but unemployment benefits exist for moments like this.<\/p>\n \u201cTry to get past the mental image of \u2018I\u2019m not the kind of person who needs public benefits,\u2019\u201d Rogan said. \u201cDo something to get any kind of money coming in.\u201d<\/p>\n The same goes for food banks and other free resources, like those you might find at your public library. The CASH Campaign can tell you if you are eligible<\/a> for public benefits and connect you with local resources.<\/p>\n There are also small loans available for federal workers. Maryland\u2019s Federal Worker Emergency Loan Program<\/a> offers an interest-free $700 loan for state residents who recently lost their federal jobs and are experiencing financial hardship. The Federal Employee Education and Assistance Fund<\/a> is also offering no-interest loans of up to $2,000 to federal workers who recently lost their jobs.<\/p>\n \u201cThe biggest message,\u201d Rogan said, \u201cis to do what you can to get some income coming in so you\u2019re minimizing the use of savings and reducing the potential amount of debt.\u201d<\/p>\n Be smart about debt<\/p>\n If you have to take on debt, there are strategies to minimize harm. Understanding your debt, including the interest rate and other terms, is an important first step, Adam said.<\/p>\n \u201cKeep in mind that not all debt is equal,\u201d she said. Credit card debt is generally one of the highest-interest options available, which makes it more difficult to pay off compared to other forms of debt.<\/p>\n \u201cCredit cards, while a very useful tool, need to be used as such and \u2026 only strategically used,\u201d she said.<\/p>\n While Adam emphasized that every individual\u2019s situation is different, she generally advises clients to prioritize paying off debt and then put money into savings. Start with your highest-interest rate credit card, even if you can only pay a little extra each month, while also making minimum payments toward any other debt you have, she said. <\/p>\n Once that credit card is paid off, put the money toward your credit card with the second-highest interest rate, and so on. Once your debt is paid off, you\u2019ll have a chunk of money that you already set aside each month that you can put into savings.<\/p>\n Many people feel ashamed or helpless about their credit card debt, Adam said. But you\u2019re not alone \u2014 almost 80% of U.S. households have some debt, she said.<\/p>\n You can explore debt optimization strategies like consolidating credit cards or using a personal loan with a lower interest rate to pay them off and give yourself more breathing room, she said.<\/p>\n \u201cThere is a way to get out of it, and you\u2019re not unique,\u201d she said. \u201cYou haven\u2019t messed up compared to everyone else in the country.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"It takes planning and discipline to build up a savings cushion, but that money can start to disappear…\n","protected":false},"author":2,"featured_media":59586,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[1558,28,11999,147,530],"class_list":["post-59585","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-baseball","tag-business","tag-national-league","tag-personal-finance","tag-personalfinance"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/59585","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=59585"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/59585\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/59586"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=59585"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=59585"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=59585"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}