Redundancy is far from a pleasant thing to deal with. That’s why it’s important that a person going through redundancy gets the support they need from their partner – emotionally as well as financially. How do I know this? Because in 2012, out of the blue, it happened to us.
I remember my husband telling me he’d been made redundant like it was yesterday. He looked so worried, so uncertain of what lay ahead. We hadn’t had any major money worries since we were students, and now it would be up to me to keep us trucking along until he found work again. I had this dull, heavy feeling in the pit of my stomach thinking about how we would cope.
Thankfully my hubby was able to find work within a few months, but not before we learned some very valuable lessons about our finances during his time out of work.
1. Don’t panic!
Easier said than done, I know. As cheesy as it sounds, maintaining a positive attitude through redundancy can help improve your prospects of finding work.
Remember that redundancy is not your partner’s fault and prospective employers won’t hold it against them. Stay positive, and gently encourage them to update their CV and keep applying for jobs. Ask your friends and family to keep an ear to the ground for any vacancies that may arise.
In this current climate, there are very likely to be days when your partner’s next job seems far over the horizon. This is normal and to be expected – being made redundant can leave a dent in a person’s self-esteem as well as their bank balance. Try to be patient and reassuring, and don’t spend too much time fretting about things that haven’t happened yet. Debt Remedy can help you put together an action plan to keep on track with your finances until things improve.
2. Find out about redundancy pay
If you’ve been working for your employer for two years or more you may be entitled to statutory redundancy pay. This is paid at banded rates depending on your age and how long you’ve worked for your employer, and won’t be taxed if it’s less then £30,000. Gov.uk has a redundancy calculator that can help you work out what you may be entitled to.
You may also be entitled to notice pay if you had to leave employment immediately and didn’t work a paid notice period. Unlike redundancy pay you can be paid notice pay as long as you’ve worked for your employer for more than one month. The amount you’re paid depends on the time you’ve worked for your employer. You can also claim for any periods of holiday that you were entitled to but have not taken.
You can put a claim in for Jobseeker’s Allowance (JSA) as soon as your employment ends. If you’ve paid enough national insurance (NI) contributions then you should be able to claim contribution-based JSA. This can be paid for up to 26 weeks and if you have not found work after this time you may be moved on to income-based JSA, depending on the rest of the household income.
There are a variety of additional benefits you may be able to claim, or you may be due an increase on the benefits that you already claim. A full benefits check will ensure you’re receiving the income you are entitled to.
4. Cut costs
There are many areas where you can cut costs. The best place to start is to get a list of your direct debits from your bank and check whether you need everything on the list.
You might be paying for a gym membership you don’t use, magazine subscriptions that ‘auto renew’ and multiple types of insurance that may cover you for the same thing. Always check what it is that you are cancelling before you go ahead – you don’t want to cancel any priority bills.
The biggest saving I made during my hubby’s redundancy was on our food shopping. We were shopping at one of ‘the big 4’ supermarkets and spending around £50 a week. We decided to start shopping at a cheaper supermarket after hearing about their price and quality, and we were able to reduce our food bill to £30 a week! Our diet is full of fresh veg, fruit and fish and we didn’t have to compromise on quality whatsoever. Even after my hubby found a new job we continued to shop there and we still do.
5. Stay positive
When times are tough, it can be easy to lose sight of what really matters – being with the person you love, through good and bad. Life has its fair share of tribulations, but I really believe that it’s the curveballs we get thrown in life that really show us what we – and our most important relationships – are made of.
If you find yourselves dwelling on the redundancy, do all you can to think and do other, positive things. Rent a film, go for a walk, meet up with friends and family; do things that make you feel good. There’s a high chance your partner will want to do stuff to take their mind off their current situation, too.
6. Seek support
It really helps to share your concerns with people who are going through or have gone through a similar problem. They’ll know and appreciate all the worries you’ll be dealing with at the moment, and can give valuable advice on how to cope. Pay a visit to the Redundancy & Redundancy Planning message board on MoneySavingExpert.com, and take comfort in knowing that you’re not alone.
7. Plan for the future
As soon as you find work again continue to follow your budget. Okay, we’ll let you celebrate finding a new job, but don’t let all of your hard work in budgeting go to waste. Continue to keep your costs down and you can put money aside for a rainy day so that you’re not caught out by unexpected costs in the future.