Most people take a job they hate quickly because they need to start making money immediately, but that’s not the best idea. If you’re between jobs, you should be able to take your time, apply to several places, and try to find an environment that truly works for your needs. Therefore, you must learn how to budget correctly. Let’s find out more!
1. Define Your Bills
The first part of budgeting is determining how much you spend each month on average. First, you should look at the priorities such as groceries, utility bills, mortgages, and insurance. You can create a spreadsheet on your computer to track a few things. Figure out the minimum amount of money you need each month and try to lower everything else as much as possible. You might have to make some sacrifices, but that’s part of handling your finances correctly.
However, you should always have some money in case of emergencies. According to the National Flooring Safety Institute (NFSI), around one million slip-and-fall accidents end up in emergency rooms across the country. You never know what could happen, so you must factor in that extra expense just in case.
2. Go by the 50, 30, 20 Rule
If you don’t know where to start, you can always follow the 50, 30, 20 rule. Fifty percent of your income should be placed on bills and necessities, as those are your fixed costs. Thirty percent should typically account for varying expenses like entertainment and food. You’ll have to cut most of this out when you’re in between jobs.
Finally, you should save 20 percent of your budget. You’ll have to force yourself not to touch that money and continue saving as much as possible while trying to find employment. Your savings account might be there for emergencies, but only use it if you need to repair necessary things like plumbing. One in ten homes in America has leaks that can waste around 90 gallons of water daily. That increases your bills, so always stay on top of your home to prevent things from worsening when you’re trying to save between jobs.
3. Find Other Sources of Income
A household shouldn’t depend on one job for its entire survival, although that’s sometimes inevitable. Most people start collecting welfare or insurance benefits after being laid off. Some other programs might help with your finances while you search for other employment. You could also try to find side hustles and gigs that will still bring money so you don’t exhaust your savings. Nowadays, people can find jobs online that don’t take so much of their time. Working from home is even better than trying to find other temporary employment.
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4. Cut Down on Unnecessary Expenses
After defining your bills, you might have noticed optional expenses. People usually cut things like their cable or extra channels between jobs. Getting a Netflix or another streaming site subscription could be the perfect solution. It’s much cheaper and more efficient since you already pay for the internet. In today’s world, the internet is considered a necessity. You’ll need it for side hustles, job searching, interviews, and more.
5. Hunt for Deals
You’ll probably have more time when you’re in between jobs, so you should try finding all the deals online and coupons in newspapers that you can use. Anything that can reduce your bills by even a fraction can be a huge relief. These discounts will probably only help with your food and hygiene products, which are part of your fixed expenses.
If you follow this advice, you can take your time and look for the right kind of job. Otherwise, you might quit your new workplace and have to start searching and budgeting again. Take care of your finances well, so you won’t be rushed into something you hate.