What Can You Do If Your Monthly Income Suddenly Drops?

Whether it is due to a global or personal crisis, experiencing a sudden drop in monthly income is not uncommon. However, this does not mean that most individuals know how to mitigate the effects of a powerful financial hit. Although there is no easy way to get through difficult financial situations, there are ways to get the money that you need to at least maintain a decent lifestyle until you can get back on track.

This having been said, not all of these methods will work for everyone, but most of them should at least give you a starting point from which to rebuild your financial life.

Look for ways to reduce the cost of your debt

If you have active personal loans and credit cards, look at the possibility of getting a debt consolidation loan. These often span over several years and are great for taking your existing loans and repaying them so that you’re only left with one large one that you can pay over the span of 5+ years. Some debt consolidation loans can also be used to top off credit cards.

Giving up credit cards is a great way to get your finances under control.

Give up your credit cards and take out a line of credit

If possible, close any credit cards you have and take out a line of credit. Unlike the former, lines of credit are much more affordable. This is due to the fact that you gain access to a large amount of money, but you only pay interest for what you actually take out of the account. Furthermore, in most cases, if you put the money back before the end of the month, you may be able to get away without having to pay any interest at all.

Claim any benefits that you have access to

Depending on your situation, you may be able to claim statutory sick pay, or claim other benefits if you are either prevented to work by the employer or you are self-employed.

You should also apply for any welfare benefits that you have access to. During exceptional situations, certain local councils may even offer local welfare that can cover the cost of food, clothes, household items, and even bills.

Use any resources that you have at your disposal

If the situation is truly grim, there is also the possibility of going to the local food bank and gain access to their support. While you will not receive a wide variety of products, rather basic, cheaper ones, you should be able to get everything that you need in order to cook nourishing meals. You can also look to online lenders who offer money quickly to tide you offer.

During crisis situations, your children may also be able to get free meals at school, if you get certain benefits. Although they will only get one meal, it should be enough to relieve a bit of financial stress and give you the resources to buy other vital products.

Look for alternative income sources

Always look for alternative ways to supplement your monthly income. If you earn less or are laid off, every penny counts. Depending on your skills and education, you should be able to find secondary income sources. For example, if you can play a particular instrument, consider teaching others either face to face or by using an online platform.

Look at the job boards of popular freelancing platforms, start an online crafts store, or create webinars and teach others new skills that you’ve honed over the years. There are thousands of ways to make money on the side.

As a side note, when it comes to looking for alternative sources of income, one may not be enough. It is usually recommended to try to do at least 2-3 things, preferably ones that complement each other, such as starting a blog/vlog, establishing a brand and then selling merchandise or creating paid webinars.

Leave a Reply