How To Handle A Gap In Your Finances: Handling The Stress Of Sudden Low Income

Most people dread the idea of dealing with a personal finance challenge. Those times when you’re in between jobs or your hours have been cut can be very difficult. Similarly, you may also be in debt and struggling to pay it all back, and you’ve had to cut down on various expenses in your life. And sometimes, all of this is going on at once!

Thankfully, there’s a lot you can do to take the challenge out of periods like these. It may still be a daunting prospect to face, but there are ways to navigate financial issues. 

The worst one of all, however, is when you’re very suddenly hit with a loss in income. This could happen for a variety of reasons, but one day you were earning well and had no significant stress, while the next you see trouble looming and can’t stop worrying about paying the bills. 

At a time like this, action is essential. Taking it ASAP will help to hold back the tide of debt and stress and feeling like you’re spiraling down. Remember, this gap won’t last forever, but while you have to deal with it, the tips below might just help you to form a plan for the future. 

If You’re Dealing with Mental Health

Mental health worries can make your life seem like it’s totally out of control. You may take more time off work than ever before, and you may not be able to carry out your usual hobbies and activities. All in all, anything you do to bring money in can slowly grind to a halt. 

If this kind of problem is affecting you, it’s best to reach out for help as soon as you notice. If you don’t want things to feel like they’re getting away from you, and you just don’t have the energy to catch up, talk to someone. 

Low cost therapy is out there, and can be used by anyone who has financial worries. Or if you have insurance, you should be able to pay for multiple sessions without any issue. Double check this beforehand, however, as you don’t want to take out a string of counseling appointments without this guarantee. 

If You’ve Been Injured

When you sustain an injury, no matter where the injury is, you may need to take some time off. Resting is best for healing, alongside a bit of gentle exercise to strengthen things, and that can’t be done if you’re sitting at a desk all day long. Plus, getting back on your feet to work a cash register may just exacerbate the injury and make your recovery so much worse!

Taking time to heal is key, but don’t worry too much about the impact on your income. It may be sudden, but usually there’s a case you can pursue. Accidents happen, of course, but if the injury occurred outside of your home, get in touch with a lawyer. Check to see if there’s some compensation you can claim, and see what a professional thinks of your chances of success. 

You can also take out insurance, to cover you during times when you can't work due to sickness or injury. This is a kind of insurance made to protect your income, more than anything else, but it’s something you can claim against during a sudden and unforeseen time like this. 

If There’s a Legal Issue 

Legal issues are more common than you’d realize. A lot of people have to deal with them, and during this period, they have to stop working or cut down on their amount of hours per week. Even when someone isn’t in hot water themself, someone they know could be affected, or they may be involved as a witness in a stranger’s case.  

This is all to say that ‘legal issues’ aren’t necessarily a bad thing, but for the foreseeable future, your income will be affected. But thankfully, there’s a lot of aid out there for anyone who has a legal issue to contend with.  

To start with, if you’re in need of bail and can’t afford it yourself, you can work with an agent who can post it for you. A service like Balboa Bail Bonds allows someone to pay only a small fee to secure their bail, which can prevent the long term impact of large amounts of money being held outside of your account. 

Plenty of free advice is available too. Most lawyers allow for free consultations, and many work on a ‘no win, no fee’ basis. That can prevent mounting a defense from becoming financially unviable, which can lift a lot of the stress you’ll feel at a time like this.  

Get All of the Details Down in Your Budget 

You’re on a lower income than you’re used to. OK, let’s make sure you know the true fine details of the situation you’re in. To ensure this, create a new budget that doesn’t let anything fall through the net.  

Get your old budget sheet out as well, as you’ll need to make plenty of comparisons here. To start with, how does your current income compare to the usual amount? You need to know the real deficit to calculate what you can afford accurately. 

Talk to Your Partner

If you’re in a relationship, be sure to talk to your partner about potential money issues the moment you know they’re on the horizon. The person you share your life with needs to be kept in the loop, especially if they’re also an earner and you’re living on a dual income. 

After all, they’re now going to have to pay more towards the pot than usual, or they may even need to start paying for everything. 

Focus on Taking Control of Your Career

Putting the control on your side of the table is key to navigating sudden dips in income. Your career should always be your own, but when you’re not the boss, there’s always going to be a chance you’re the one on the receiving end. It’s not up to you whether you get to stay in a role for the long term - someone else will always have the deciding power. 

So, maybe it’s time to start your own business. Maybe it’s time to start freelancing in your spare time? Maybe you should think about investing in real estate, if you’ve got the funds there, and generating a more ‘passive’ income that can really pad out your bank account. The more ways you can make money, the better.   

Dealing with a Sudden Loss in Income: What to Keep in Mind

This can be a very problematic time in life, and a lot of change is likely to come your way. These can be both positive and negative in nature, and the mental toil it can take can be very hard to recover from. However, you’re not powerless here. 

If something has happened in your life that means you can no longer work, there’s help out there for you. If you’d like to use this period as an opportunity, go ahead and do so! In fact, we’d even recommend it - when you’re the one in control of your career, very few people can pull the rug from under you. 

And above all, make sure you know the ins and outs of your financial situation. Get it all down on paper and see what outgoings have to be paid, which ones can be reduced, and if there are any that can be removed entirely. 

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