Many families and couples are set up to be two-income households. Meaning, things only work when there are two incomes coming into your bank accounts.
But what happens if one of you loses your income?
Well, you’ve got to cope. And not just cope financially, but also cope with the extra stress and relationship strain that comes from job loss.
Being laid off four times between the two of us in the last decade, my husband and I understand this well.
I’m going to give you some ways couples can cope – both emotionally and financially – when one of you loses an income.
Openly communicate your emotions to each other
There are going to be a lot of emotions right now.
Emotions from the person who was laid off, emotions from the person who is still working, and even changes to your collective emotions as a family.
One key thing to remember here is that you don’t know how the other person is feeling until they tell you.
You might be feeling one way, and they might be feeling another way.
For example, I can remember clearly how I felt when I was laid off each time. I tend to tie my identity way too closely with my work, and so being laid off was emotionally devastating to me. It felt like I had been rejected in a big way, and that a large portion of my life was over.
At the same time, when my husband was laid off from one of his jobs, he felt an element of relief. If I had never asked him how he was feeling, then I never would’ve known what he was going through.
Ask your partner how they feel, and then give them the floor to really answer the question. Don’t try to give them fill-in-the-blank emotional responses that they should be feeling, and don’t talk over them. Just listen.
And then, make sure you communicate your own feelings about the situation.
Open communication is always needed for your relationship. But now? It’s needed more than ever.
Other things to communicate about:
· How much to share: Your level of comfort in sharing the news with family and friends, and how many details each person is comfortable sharing, may be different than your partner’s comfort level. Hash this out before anyone makes an announcement.
· Your fears: Getting to talk about fears is one of the best ways to get over them (or at least to not let them rule your life).
· Your hopes: This is just a temporary season of your relationship and of your life. Be sure to keep each other hopeful by sharing both the positives in the situation, as well as what you each hope will result on the other side. This can also really help in knowing what types of jobs to apply for, what locations, and many other things to put you both on a better path the next time around.
Of course, communicating about emotions and feelings isn’t all that needs to be done. You’ll need to communicate about your finances, too.
Openly communicate your financial situations
If you’re in a relationship with each other, then one person’s finances will directly affect the other person’s finances.
And this is the case whether you’ve combined your finances 100%, or whether you each have separate bank accounts and bills are in separate names.
Think about it – the person being laid off is now able to contribute substantially less money than before to the overall pot. And if there was never an “overall” pot and you both paid bills separately?
Well, now the person with the job will have to pay for more things.
You’ll need to gather the stats on your financial situation and sit down for one, two, and probably several financial discussions.
In fact, now’s a great time to start that weekly money management meeting (if you haven’t already).
Money stats you’ll want to gather so that you can talk about them include:
· What one income pays in your household: The person with the remaining income will want to share their exact take home pay. Then, you’ll both want to know how much of the monthly bills this one income will cover. Is there a gap? How much is that gap? Keep reading to figure out ways to decrease that gap.
· Current debt minimum payments: Maybe you’ve been paying more on each of your debts to pay them down quicker. Now’s the time to go back to paying only the minimum debt payments each month, and to use that extra cash flow to make up for the decrease in overall pay.
· Snapshot of monthly spending: Use software to quickly analyze the last 1 to 3 months of your household spending by category, such as food, clothing, gas, rent/mortgage, utilities, etc. Software programs that will do this automatically once you associate your bank accounts include Mint and Personal Capital.
· Suggested spending cuts: Each of you can take the snapshot of monthly spending, and suggest places where you can personally cut back on spending. Then, suggest places where the household can cut back on spending.
· Emergency fund balance: Figure out how much money is in your emergency fund, how much is in regular savings accounts (even if that regular savings account was really earmarked toward something fun, like a trip), and what you’ve got in other investment accounts. It’s good to know your Plan B, Plan C, and even Plan D in the event that you can’t pay your bills.
You’ll use all of this information in the next step as you work through taking specific money actions to mitigate financial stress.
Divide up new responsibilities
With loss of employment, there will be a shift in responsibilities. Also, there will be a new set of responsibilities added to the plate that need to be divvied up.
For starters, now that one person will be home, how can they lessen the load of the other person? What old responsibilities can they now assume to both keep their morale up, and to help out the household?
Next, there will be new responsibilities to divvy up (heads up – some of these new tasks and responsibilities can only be completed by the person who is unemployed).
Here are a few that come to mind:
· Apply for unemployment: The person who is unemployed will need to see if they can apply and get unemployment insurance.
· Tie up loose ends with previous employer: Do you have a 401(k) or other retirement plan that you want to roll over into your own retirement plan? Can you secure referrals from your previous employer and/or work colleagues to use on future job applications? What other loose ends do you need to tie up to move on and sever ties in a productive way?
· Find a healthcare plan: How long does your healthcare plan last with the previous employer? See if you can get onto your working spouse’s healthcare plan now. If not, you’ll need to search for a new healthcare plan.
· Get your resume in order: Use each other’s strengths to prepare an outstanding resume. If nothing else, the other partner can edit and make suggestions once your partner completes their resume draft.
· Job hunt: While the person who is unemployed will definitely have more time to job hunt, two sets of eyes are better than one. If either of you sees a good opportunity, then definitely send it along.
· Make phone calls to service providers: Use some time to call service providers such as your cable television company, your childcare provider, and your student loans provider. Explain to them that you are recently unemployed, and are looking for ways to cut costs. Can you cut down the amount of childcare time, or nix an afterschool childcare program now that one of you is home to cut down costs? Can you opt out of a more expensive cable package? Can you defer your student loan payments while unemployed?
Take the time to get your financial ducks in a row, and you can lessen the amount of financial stress you’ll feel from this experience, considerably.
Above all else? Make sure that you each feel supported, heard, and loved. It will help immensely as you go through this, not to mention could help your relationship come out of this situation in an even better place.
–By Amanda L. Grossman