GOOD MORNING...YOU'RE FIRED!!! BEN'S TIPS ON SURVIVING FINANCIAL [AND EMOTIONAL] UPHEAVAL

The reaction when we went out on the streets of Dallas a couple of days ago with camera rolling doesn't surprise me. In fact more Americans are more willing to talk about their sex lives than their personal finances.  There's such a taint of shame or embarrassment that goes with the reality of losing one's job...of being fired. And while we've experienced some [positive] record numbers in our economy over the last decade, the real truth is that there's always going to be hundreds of thousands even millions of people that are out of work at any one time. 

[PLEASE NOTE: These are general advice tips and not meant to be the definitive laundry-list of steps every consumer should follow.  Everyone's situation is going to be different. ALWAYS consult with an attorney (and where necessary, an accountant) before making final decisions regarding your own financial survival situation.]

Let's talk "Reality 1A According To Dover". What's the very first thing a person should do the day they're fired?  There's several things that need to be immediately addressed:

1. Get out the calculator: Create a page with the word "CASH" at the top and add up all of your available cash...this means cash in checking, savings, liquid investments that can be sold without either taking a beating [loss] or creating a tax event [gain].


2. Define your exit benefits: Did you get any severance pay? [Add it to the "cash" page of figures outlined above.]


3. Create a page list of all debts: Let's break down the debts to their monthly minimum payments due, starting with the essentials...rent/house payment, utilities, food, phone, insurance, child support/tuition, student loans, auto loan/lease payments, gasoline/maintenance, credit cards, unsecured loan payments, etc.  Add up what your MINIMUM payments are going to be [approximately] every month for the next six months.


4. Define your exit insurance benefits: Under federal law, employees previously covered under group health insurance plans are entitled to continue health benefits through the "COBRA" laws...which usually extends benefits for 18 months from termination date. Whether or not this type of coverage is kept is always a judgment call for each consumer. 

If money's tight and you're a "lone wolf" [meaning you have no dependents like a spouse or kids, or you're not responsible for providing health insurance pursuant to any divorce decree for a former spouse or kids not living with you], then keeping health insurance intact is usually a much lower priority.  If you have any health problems or the potential for health complications, then keeping your health insurance benefits intact is a must and this expense must go to a much higher priority level on your list of debts/monthly payments.

5. Do the math: Figure out early on...
   
   

   a-How good/bad your short-term [1-4 month] financial outlook really is
   
   b-How long your "stash of cash" will last, based on your monthly bills/cash "burn rate"

1. Do you have a tax refund coming to you?  Get your return filed [electronically will get the cash back into your hands even faster] and get your return filed/refund received asap!


2. Do you have any cash value insurance policies that can be tapped?  Get sound advice when going this route [from your insurance agent and/ accountant] but many times consumers can pull cash out of their policies and still be covered with a death benefit [less any monies advanced/loaned from the policy].  This is always an inexpensive source of cash that can be turned pretty quick.


3. File for unemployment benefits!!! It's never been easier...the local numbers to call: (214)252-1200 in Dallas or in Fort Worth it's (817) 420-1600...or contact your local directory assistance and ask them for the Texas Workforce Commission office in your area, or check the out on-line: www.twc.state.tx.us/customers/jsemp/jsempsub2.html It's a breeze.  And remember: You've "paid in" to the system, so get what's rightfully yours!

7. Start slashing your budget!!! You'll extend your survival time by trimming your expenses.  Some obvious and perhaps not-so-obvious place to start cutting include:
   

1. Dump the cable. Dump the high-speed computer access.  Go back to a 56K dial-up until you get back on your feet financially.


2. Gotta cell phone? Reduce your calling plan minutes and trim the monthly rate, if contractually possible.


3. Quit eating out!!! Re-acquaint yourself with some handy tools or devices that will help s-t-r-e-t-c-h your food budget.  Things like that big box in your kitchen?  It's called an oven. Those little circles that get real hot? That's a stove. That smaller electronic box on top of one of your counters or perhaps built-in to one of your cabinet fronts? It's called a microwave oven.  You can prepare food in the comfort of your own home and save countless $$$ eating out if you go this route.


4. Sell an unused/dormant assets: Biggest violators?  Extra cars, trucks, water craft that are either costing $$$ through monthly debt payments, or if they're free and clear, still cost you in terms of having to store, maintain and insure them.

8. Rate your creditors: Go through and rate A-B-C in level of payment importance. Remember, the "essential creditors" deserve the "A" designation: These are creditors that are either secured (like house payment, apartment rental, car [lease or purchase] payment and any court ordered payment like child support, for example.
   
   Your "B" list would include important/essential items, but not secured: Electricity/utilities, insurance, food and student loan payments, etc
   
   The "C" list covers the rest of the pack...all important, but in the big picture, they can get in line and wait for you to get back on your feet if push comes to shove: Student loans (they can move to this classification if you contact the company servicing your loan and ask them for a repayment "grace" period [also known as holding your loan in abeyance] while you get back on your feet financially and any credit cards or unsecured loan payments.

9. Keep your chin up, dammit!!! The cream always rises to the top...and even though all of the economic indicators show the economy is slowing down, the reality is simple: Good people really are still hard to find.  Be aggressive and persistent in getting a handle on your financial situation and getting a new job.
   
   Closing Thoughts: Every expert has their own theory...but Rule of Thumb on your financial safety net?& Keep 3 months cash or liquid assets tucked away, bare minimum...preferably 6 months.  Oh yeah...how do you know how much it'll take to keep you afloat in between jobs? Just take a look at your budget, the one you're supposed to operate from every month, in good or bad times anyway, remember???
   
   Don't have a budget? Go back to Ben's Steps 1-8 and do the math, obviously if you're in the middle of an employment void, but especially if times are good!  I'm walking proof: In the radio business for example, you just never know when you'll be dealt a harsh reversal and find yourself on the street! See for yourself: click here

REMEMBER: These are general advice tips and not meant to be the definitive laundry-list of steps every consumer should follow.  Everyone's situation is going to be different.  ALWAYS consult with an attorney (and where necessary, an accountant) before making final decisions regarding your own financial survival situation.