While some people may go through life remaining employed from their first day of work to their last, this is far from a common occurrence. Most people will find that, at some point, they will be between jobs for one reason or another - whether it’s due to a former employer closing down, or needing to take time off to recover from illness or injury, income gaps are fairly frequent occurrences.
As one would expect, no-income periods can be incredibly difficult to deal with financially - but there are a few ways you can manage the situation effectively. Below, we’ve compiled a few tips that can help you - and your finances - over the gap successfully.
#1 - Inform your creditors of the situation
If you have any debt, then call your creditors as soon as possible to explain that you no longer have an income. While this is a tough phone call to make, it is an important one, as your creditors may be able to freeze your interest or allow you to make token payments for a while - both of which could help make your finances a little easier to manage.
#2 - Cut your expenses
Even if you have significant savings, cutting your expenditure is highly recommended during a no-income period. Focus primarily on areas that you can cut without a penalty, such as streaming services or newspaper subscriptions, as a first priority. If you do need to cut a service that you are in-contract for, then call the provider and ask if they can help in any way; some may be able to offer payment holidays, or may allow you to pay the termination fee over a period of time rather than all in one.
#3 - Track down funds you might be owed
During a no-income period, following up on any funds you may be owed is definitely worth doing. Perhaps your former employer made a mistake on one of your payslips and you are owed back pay; you may have had to leave your job due to an issue that personal injury attorneys could help access compensation for; or a company that promised you a refund failed to deliver. Tracking down all of these possibilities could help to ease your financial situation, so leave no stone unturned.
#4 - Consider non-employment related income options
While you’re searching for a job, or recovering from an injury, it’s worth considering different methods of increasing your income outside of a standard job. For example, if you have a spare room in your home, you could take in a lodger, or offer the room on rental sites such as Airbnb. Alternatively, you could give mystery shopping a try; use online survey sites; or even start a blog that you monetize - all of these ideas can provide an income stream that can help to keep your finances ticking over.
In conclusion
Income gaps are never ideal, and will always have a tendency to place a strain on your finances. However, the tips above can help you to find your way through your no-income period with your financial health intact.
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