For the main provider of a family, it can be the biggest nightmare scenario: Suddenly, you're out of a job and the flow of money has stopped.
For 800,000 of the country's federal employees on furlough, that nightmare has become a reality, and they are sitting at home no doubt thinking about how they will make ends meet until the government shutdown is over.
If the government crisis is temporary, those workers will eventually go back to work, and Congress is considering legislation to retroactively pay them for the time they were away. In the meantime, they will have to budget and scrounge for every bit of money they can find and keep until that happens.
Jack Gillis with the Consumer Federation of America, the country's largest nonprofit consumer-advocacy group, and Don Milne, financial literacy manager for Zions Bank, offer these quick tips to help with finances while your income is on hold.
Creditors • Contact your major creditors for your car loan, home mortgage and credit cards, for example. Tell them that you're a federal worker on furlough and that you may miss the next payment on any loan but you have every intention of making it up. Creditors most likely will work with you.
"It's always better to warn your creditors in advance," Gillis said, "than not be able to make a payment and try to explain after the fact why."
Bills • Carefully review your monthly bills for utilities, cable television, rent and such and immediately notify them of your situation. Again, they should work with you.
Prioritize • While listing all of your monthly obligations, prioritize the most important payments that have to be made more immediately with whatever savings you do have. For example, if you don't pay your electric bill, the power company won't cut your electricity right away; but if you miss a credit card payment, your interest rates could skyrocket for the next payment.
Quick cash • Don't go to a quick payday-loan center if you need cash right away, which can charge up to 20 percent fines for any money you borrow. Instead, consider taking a cash advance on your credit card, which on average charges a 2 percent fee on top of the interest.
Bank • Talk to your bank to see what plan it may have for federal furloughed workers. Zions Bank, for example, now has a Furlough Assistance Program that can "modify existing loan and credit card terms for current clients and … expedite the credit approval process for both new and existing clients. Modifications will be considered on a case-by-case basis," according to Zions.
Garage sale • Milne said another way to get cash quick is to clear out the house of junk and finally host that garage sale.
Spending • To help reduce expenses, shoppers should consider capping how much to spend before shopping. Then get the set amount in cash beforehand and use that while shopping instead of a debit card or writing a check to ensure you don't go over budget. Milne said when people use a card or check, they're usually oblivious to how much they end up spending.
" 'Think twice and spend once' is going to be your mantra as you struggle through this very difficult situation," Gillis said. "Do you really need that particular item? Do you really need that cup of coffee from Starbucks?"
Unemployment insurance • Federally furloughed workers are eligible for unemployment insurance, but those who have stayed on the job because they are considered "essential" are not, according to Nic Dunn of the Utah Department of Workforce Services.
Be aware that there is a one-week waiting period after being furloughed before you become eligible. And those who accept unemployment payments must pay that money back once they return to full-time work. Furloughed workers are exempt from the requirement to look for jobs while receiving unemployment benefits.
For more information, go to jobs.utah.gov.
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