What do you do when you have no income? How do you survive?
Having no money coming in is terrifying – especially when you can't pay your bills. There are many things you can do if you get into a situation where you have no income. In this post, I'll discuss what options you have so that you can survive with no income.
1. Dip Into Your Emergency Fund
If your income is suddenly cut off, the last thing you'll want to do is fall into more debt, if you have debt. Try to avoid using credit cards to pay your bills and, instead, dip into your emergency fund. That's what it's there for.
Use your saved money to cover your living expenses while you get through this period of no income. A solid emergency fund should have three to six months' worth of living expenses. This money should last you some time.
If you have little to no money in your emergency fund or have been without an income for some time, then it's time to start looking for other ways to get by while you get through this financial hardship.
2. Look For Any Source of Income
When you've lost your income and are looking for ways to survive, do whatever you can do make some extra money. Even picking up a side hustle one to two days per week can help you out in a huge way.
If you have family who are willing to assist you, consider reaching out for help – just make sure you clearly define if you will need to pay them back and, if so, how the repayment will work.
Find a part-time job, even if it's temporary. You have to get money rolling in to improve your situation.
3. Prioritize What Bills You Pay
Your bills may start piling up, and this can definitely feel scary. When this happens, it's time to prioritize which bills you pay and which bills you allow to be late. While you risk harm to your credit score, right now, you must focus on surviving, which involves keeping yourself in your home and staying fed.
Pay Your Rent/Mortgage and Buy Food First
First thing's first, pay your rent or mortgage and keep your pantry stocked with food. If you have an app like Ibotta to save you money on groceries, start using it each time you shop. If you specifically buy featured items on Ibotta, you could save over 50% of your grocery bill.
If you have a mortgage and are having trouble paying the monthly payment, contact your lender and tell them you're having financial difficulty. It's preferable to contact your lender before you miss a payment. They may be able to provide a solution to help you keep your home, such as giving you a deferred payment option.
You can often be late a month or two on your utilities before you risk action such as a shutdown. Once your rent or mortgage is paid, and you have enough food to eat, pay your utility bills. Utilities like your electricity, heat, and water are most important. Then pay your internet bill if your internet is required for day-to-day life.
Additionally, reach out to each of your service providers to tell them you're having difficulty paying your bills. If you reach out before you miss payments, your providers may be more able to work with you.
After you've paid your utilities, it's time to look at other ways to increase your cashflow if you can't find a job or side hustle.
A great way to get a quick influx of cash is to sell your assets. Assets can be anything from investments to a musical instrument you own. If you've collected a lot of stuff over the years, consider organizing what you truly don't need and selling it on eBay, Craigslist, or a local yard sale group on Facebook.
Some examples of assets you may no longer need that could net you some value include:
- Textbooks from college
- Musical instruments
- A collection of items you have, such as old games, baseball cards, dolls, etc.
- Electronics that you no longer use, such as an old computer or TV
Selling assets like those mentioned above will help you in the short-term to pay your bills and prevent yourself from going into further debt.
4. Reach Out to Creditors
When you're struggling to survive because you have no income, it's important to reach out to anyone you owe money to and alert them to your situation. This includes your credit card companies and anyone you have a loan to, such as an auto loan or mortgage.
By giving a heads up to your creditors that you're having trouble affording payment, they will often work with you.
You don't want to ignore your creditors as that could cause more long-term issues, such as greatly harming your credit score or leading to creditors to repossess things from you. This could include losing your car or home.
Credit card companies can't repossess anything from you, but if you stop paying your balance for too many months, they can sell your debt to a collector and possibly sue you for the debt, which can lead to garnished wages.
5. Get Help Via Community Assistance
If you believe you'll be without income for some time, you can reach out for community assistance. This includes benefit programs such as food stamps, SCHIP (State Children's Health Insurance Program), WIC (Women, Infants, and Children), and other services for low-income families.
It can take time to get on community assistance programs, so reach out as soon as possible and promptly get all requested information together.
6. Look For Remote Work On A Site Like Glassdoor
The job site, Glassdoor, has an immense amount of job opportunities. Many of these job opportunities can be done remotely from home. In fact, in August of 2020, I checked Glassdoor to assist a friend in finding remote work, and there were more than 15,000 openings around the world.
To search for a remote job on Glassdoor, enter your location as “Remote (Work From Home)”. You can simply type “Remote” to see this option.
Then, enter the type of job you're seeking to narrow down different options. This is a great way to find new work if you've been laid off recently or simply out of work.
7. When To File For Bankruptcy
You may consider seeking out a bankruptcy attorney if you can no longer meet your minimum payments on your debts and don't believe you'll be able to for some time.
If your income is limited or non-existent, you may qualify for a Chapter 7 bankruptcy, which is when your representative sells off nonexempt assets and uses the proceeds to pay off your creditors. Most other debts are then forgiven.
Student loan debt is not forgiven from a bankruptcy. Below, I'll cover what happens with your student loans.
What Happens To Student Loans If I File For Bankruptcy?
If you file a chapter 7 bankruptcy, your student loans are not discharged. You will still have to pay them back, and you will not qualify for federal social programs such as social security until your loans are repaid.
In the case that you still can't pay your student loans, you will have the opportunity to file a complaint and attempt to prove your financial hardship. You can read more information about this at this post on the Student Loan Hero's blog.
Recovering After You Get Income Again
Once you recover from having no income, start by resuming payments to your creditors and bill collectors. Save up at least $1000 into your emergency fund to help mitigate any further hardships you incur.
Continue making payments and continue funding your emergency fund, up to six months' worth of living expenses.
Take a deep breath. You made it through this! As you recover, focus on always living below your means, so that if something happens in the future where you have no income, you'll have a lot more saved. This is sometimes called living like your broke, even when you're not at all broke.
If you're married and you're recovering from having no income, make sure the two of you get on the same page financially. This will help prevent a recurrence, and should one happen, the two of you will be better prepared.
Wrapping It Up
Having no income and trying to survive can be terrifying, but there is a light at the end of the tunnel. Using methods found in this post, you will be able to mitigate your losses and potentially find a solution to your situation.
Have you ever been without income for some time? What did you do to get by?