Nobody runs for debt when they don’t have a job. This is because you are sure that your salary at the end of the month will enable you pay for the loan. However, with the current job insecurity; you never know when you may lose the job you have. When you do lose the job, what happens regarding the debt obligation you held?
Here’s how you can be at your best even if you lose your job while having a debt obligation
- Make a list of the debts you hold. This means writing every sort of debt which may include mortgage, insurance, car loan, or credit card debts. Do not forget to list their balances and the installment you are liable to paying monthly.
- Make an insurance claim on the loans that had had payment protection insurance. This will see settlement of installments that could run up to 12 months or even more in some cases depending on the plan.
- Look at the remaining debts and prioritize them. Make a list of which debts gets priority over which others. The top of the list should be things like mortgages, utility bills, or car debts. This is a list of obligations where if you fail to meet timely payments, you risk losing something big. You can let credit card, bank overdrafts or catalogue debts be least in priority since they are associated with penalties which are not as heavy as those listed at the top of the page.
- Make a budget on how you will start to pay off the debts you have. This involves reviewing what you will be having coming in. you then have to deduct the necessity costs and the balance is what you can use to start paying off your debts.
- Put your redundancy pay or savings to use in helping you pay for your debt. This will help reduce the debt on a monthly basis.