10 Ways to Save Money When You Are Unemployed

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When I was laid off from my job recently, I had to quickly learn how to survive. I must do everything I can to save money while I search for work. (See also: The First 5 Things You Must Do After Getting Laid Off)

If you are in a similar position, you probably feel as if you are scraping by and that saving money is nearly impossible. But it isn't hopeless. Here are 10 ways you can save money and make some extra cash while you search for a full-time job.

1. Take Advantage of Local Resources

Even if you are not receiving unemployment, there are organizations that can help you with getting your basic needs met, including food and housing. The United Way and The Alliance for Information and Referral Services (AIRS) have created an easy way to find these resources in your area. You can dial 211 in most areas, or go to the 2-1-1 website to learn more about what resources might be available to you. By taking advantage of social services, you can save a lot of money on the essentials.

2. Use Alternate Transportation

We all know that gas can be a major expense, especially if you rely solely on your car for transportation. Try not to drive unless it's absolutely necessary. Public transportation is much cheaper than driving, and buying monthly passes is often a better deal than a one-time fare. Check with your local unemployment office to see if your state offers free or discounted passes for public transportation in your area for unemployed people and low-income families.

You might also find local programs that offer cheap, alternate modes of transportation. For instance, here in Burlington, Vermont, you can purchase a bike for as low as $30 through the non-profit program, Bike Recycle Vermont. Or you can get discounted tune-ups and bike accessories through the program. If walking, biking, or public transportation are not an option, some gas stations may offer discounts on groceries at local grocery stores when you spend a certain amount on gas, so you can at least save on food if you must drive.

3. Quit Unhealthy and Expensive Habits

A friend of mine also recently lost her job, and then she started smoking as a way to cope with the loss. Aside from the obvious health risks, smoking is an incredibly expensive habit. She often pays as much as $10 to $12 a pack! Alcohol is another nonessential that can take a huge chunk of your budget and a toll on your health. Keep in mind that recreational drugs and alcohol are also depressants that will make you feel worse about your situation. Even if you don't drink or smoke, there are probably other unnecessary purchases that you could cut out for the time being.

4. Eat Your Meals at Home

In addition to cutting out items that are not part of your basic diet, there are plenty of ways to save on the groceries you do need. First, avoid going out to dinner or grabbing fast food for your meals. Fast food joints might be cheap, but in the long run, eating out all the time can be more expensive than making food at home. Don't forget that soup kitchens offer free hot meals once a day, and you can find the locations through your local food shelf. Many food shelf organizations also offer recipes if you are picking up groceries, or you don't feel like you know how to cook very well. Also check with the unemployment office to see if you qualify for food stamps.

5. Find Ways to Save on Groceries

Resisting the urge to dine out and taking advantage of the food shelf are only part of saving on the overall cost of food. There are plenty of ways to save money when you go to the grocery store. Buy in bulk whenever possible, and take advantage of discounted items and coupons. One caveat: never purchase a sale item unless it is something that you buy regularly. You may end up spending more overall. Most co-ops offer a basic discount for members, and a larger discount if you volunteer a certain number of hours per week. (See also: How to Feed Yourself on $50 a Week or Less)

Joining a local CSA can save a lot of money on produce, and some CSAs offer other staples, such as eggs, meat, and dairy. Ask a friend to join with you and split the cost and the food if you can't afford the membership. The CSA weekly pickups usually include too much food for one person to eat in a week anyway.

6. Create a Realistic Spending Plan

Everyone hates to budget, but it is an absolute necessity if you want to manage your spending. Because the word "budget" implies that you are limiting yourself, one trick is to call it a "spending plan." Even though it is more difficult to create a spending plan if you don't have a regular income, it is much easier to save when you know how much you are spending. You can easily find templates for a basic spending plan online, and SaveAndInvest.org has some great advice on how to get started when creating a spending plan.

The key is to be realistic about how much you spend each month and ensure that you are covering every category. This includes purchases you may not have thought about, such as entertainment (you have to treat yourself every once in a while), cat food, emergency fund, etc. Once you do find a job again, stick to your spending plan, and put some money into a savings account each month for an emergency fund. Then if you do lose another job, you won't be as stressed about finances.

7. Join a Support Group

Debtors Anonymous is a great resource for people who have lost a job. Being unemployed for a long period of time can easily lead to crippling debt. The group meetings are based on the same 12 steps as AA and other 12-step programs. You may find that you already have issues with debting, and the group provides support when trying to break old habits, such as overspending or maxing out credit cards. Underearners Anonymous is a similar program, and often people find that they consistently accept jobs under their skill level and salary needs, which can easily lead to debting. These groups may not meet as often in your area as other 12-step groups, but if you go to the website to search for a local group, you should be able to find phone meetings as well.

8. Negotiate Reduced Rent or Mortgage Payments

Before I started receiving unemployment (keep in mind there is a waiting period, so apply as soon as you get laid off), I was unable to pay my rent in full at the beginning of the month. I decided to talk to my landlord about splitting my rent in two payments. She was very understanding and said she would be willing to work with me as long as I communicated my needs to her. You'll find that as long as you are honest about your situation, most people are willing to work with you, especially if you have been a good tenant and always pay your rent on time. If you own a house, talk with a loan officer about refinancing. You may be able to get a lower interest rate and lower your mortgage payments.

If you have student loans, you can get them deferred while you are out of work, or at least put them in temporary forbearance. For credit cards, make sure you are at least paying the minimum each month. It can be tempting to want to continue paying off debt with your normal payments, but you will risk getting further into debt if you can't realistically make those payments.

9. Don't Be Afraid to Accept Money

One of the key rules of Debtors Anonymous is not to start a new debt, which includes loans from friends and family. However, if a friend or family member offers you a monetary gift, it is okay to accept it, as long as you have a good relationship with that person. By the same token, avoid using loans to pay off other loans, even if the new loan has a lower interest rate. It may save a little money in the short term, but it can create debting habits that are hard to break.

10. Earn Extra Cash

This last tip has kept my head above water for the past few months. Even before I lost my job, I was a regular house and pet sitter for friends. While we had bartered for this service in the past, I had to ask them to start paying me after I lost my job. Again, people are very understanding if you are upfront with them.

Find out what the going rate is in your area, and don't be afraid to ask for what you need. I've also been paid for doing yardwork, cleaning houses, babysitting, freelance writing, editing, and helping friends with websites. There are plenty of opportunities to make a some fast cash while you are out of work. Use social media and online forums to offer your services. Be clear about how much you want to get paid but also try to be a little flexible if the pay is still reasonable for the amount of work you are doing. (See also: Earn Extra Income With These 15 Creative Side Gigs)

While I wish I had read You're Fired! 20 Signs That a Pink Slip is Coming before I lost my job, I have found ways to make ends meet and minimize the stress so far. Just keep in mind that you are not alone, and there are plenty of resources and support groups to help you out during this difficult time.

Have you ever endured a long period of unemployment? How did you reduce your spending?