How to Reduce Expenses If You Lose Your Job?

Job loss is concerning, especially if your home was purchased with a bank loan. However, you shouldn't keep postponing home purchase out of fear of becoming unemployed. Even if your employment with your current employer were to end, thorough optimization of home expenses can help you get by during your job search.

Although the unemployment rate is at its lowest in many years, some people still unexpectedly lose their jobs today. For example, in December, 4,697 new unemployed people registered at the unemployment office, with a total of over 31,000 job seekers.

It is clear that when unemployed, it is not possible to maintain your usual lifestyle for some time.

We present eight recommendations that help save costs during the job search period:

Put your home to work to pay off loan payments

If you have a spare room or even part of a building, rent it out. If you don't want to share your home with a stranger, consider moving temporarily, for example, to your parents' place and renting out your apartment or house entirely.

Limit water and electricity consumption

Check the website elektrihind.ee to see if you have the cheapest electricity package, and change it if necessary. Remove devices from the power outlet that you don't need right now; turn off lights in rooms where no one is currently present. If heating costs are calculated per apartment, lower the indoor temperature of living spaces: if room temperature is 20 degrees instead of 24, this gives significant savings. Turn down the floor heating in the bathroom. Don't heat rooms where no one is currently living.

Review all service subscriptions…

…and cancel unnecessary ones. If you watch only three channels on television, for example, there's no point in paying a television service provider for a hundred channels.

Also review all other usual expenses

Maybe you could give up some magazine subscriptions and instead of going to a sports club or gym, do completely free training outdoors?

Don't buy ready-made food, cook yourself

Go to the store with a list of necessary groceries and a specific amount of money, and don't use your bank card – this way you avoid impulse purchases and won't overspend.

If difficulties arise, definitely contact your bank

A loan manager will help you find the best solution for your situation. This could be, for example, a temporary payment break or a reduction in monthly loan payments along with an extension of the loan repayment period.

A car can be temporarily replaced with public transport

From a car owner's wallet, car leasing, insurance, maintenance and fuel costs take a big bite. Maybe it would be wise to give up your car for a while or replace it with a cheaper and more economical one.

If it appears that loan repayment is becoming too difficult, consider selling your property and purchasing a cheaper residence

Selling your existing home and searching for a cheaper residence may not be nearly as big an undertaking as it may initially seem. If it still seems too complicated, use the help of a real estate agent!

Article author: Arco Vara