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Fin24 user Bernadette's little daughter was prepared to give up her savings for the month to tide the family over her mother's retrenchment. Bernadette writes:
I had to share the worst news one's family has to deal with with my children: 'mommy will be retrenched and after the end of next month won't have a work any more'.
I had to explain that to my children - the 13-year-old understood it and said: 'Don't worry Mommy, God will provide,' and YES he did.
But the six-year-old was very angry: 'Why do they do that, Mommy? You can take my savings money that you are saving every month and use it for the house. It's just R200 but if you make it into small change it would last the whole month...' lol.
My girl was just too cute to put on a sad face whilst getting and breaking the bad news.
Fin24's debt expert and independent debt counsellor (NCR DC 1780) Renée Marais says being proactive will help you survive a retrenchment and build good financial values for your children.
She writes:
When retrenchment is your personal reality, it is important to think about finances in a calm and calculated way.
Here is what you can do:
1. List all your creditors
Make a list of all your creditors and contact all the relevant ones with whom you have insurance (payment protection/credit protection) to claim - that is the credit insurance you sign for at the beginning of the contract that insures the outstanding amount at the time of an emergency such as retrenchment.
The insurance will then cover payments on your behalf for a certain period while you are in the process of finding new employment. The terms of the insurance will differ from creditor to creditor, but this is the first thing you should do.
Each creditor has different requirements but they will provide you with the relevant documentation and/or information necessary to assist in the payment of your claim.
Tick those you have arrangements with off on your list and make sure that you know how long the credit protection will pay for, and how much.
2. UIF
Make sure that you do the necessary to collect your unemployment benefit.
3. Cut costs
* Look at your essential living expenses and pare those to the bone. These include housing, petrol, electricity and water, school fees, telephone costs, groceries, etc.
* Cancel all subscriptions.
* Change cellphone contracts to pay as you go, as your contract allows.
* Do not buy from convenience stores. Buy food on special offer in bigger volumes, for instance a local distributor with weekly specials on fruit and vegetables - buy those and pre-prepare.
* Have a fixed meal plan.
* Switch off lights in areas that are not being used at any particular time.
4. Make arrangements
It is better to let your creditors know about your situation before you fall behind on payments.
* Inform the school, daycare, etc that you have been retrenched and that you will need time to find new employment, and make arrangements for school fees.
* Do not fall behind with debt repayments - it is better to make arrangements with your creditors for smaller repayment amounts than not to pay at all.
* You can always see a debt counsellor to assist you with planning. A debt counsellor cannot put a consumer under debt review who does not have an income, but can assist in how best to distribute the money available to all the relevant creditors and ensure that you are in a good financial position when you resume employment.
* Do not just ignore debt as it does not go away; as soon as legal action starts, the additional costs rise fast and a small outstanding balance suddenly escalates.
5. Draw up a budget
When you know how much money you have available - from the retrenchment settlement and the UIF - do a budget for your household for three months and stick to it.
Finally, by being proactive you will survive the retrenchment and build good financial values for your children.
- Fin24
Consider yourself a savings hero? Or just have something on your mind? Add your voice to our Savings Issue:
* Write a guest post
* Share a personal story
* Ask the experts
I had to share the worst news one's family has to deal with with my children: 'mommy will be retrenched and after the end of next month won't have a work any more'.
I had to explain that to my children - the 13-year-old understood it and said: 'Don't worry Mommy, God will provide,' and YES he did.
But the six-year-old was very angry: 'Why do they do that, Mommy? You can take my savings money that you are saving every month and use it for the house. It's just R200 but if you make it into small change it would last the whole month...' lol.
My girl was just too cute to put on a sad face whilst getting and breaking the bad news.
Fin24's debt expert and independent debt counsellor (NCR DC 1780) Renée Marais says being proactive will help you survive a retrenchment and build good financial values for your children.
She writes:
When retrenchment is your personal reality, it is important to think about finances in a calm and calculated way.
Here is what you can do:
1. List all your creditors
Make a list of all your creditors and contact all the relevant ones with whom you have insurance (payment protection/credit protection) to claim - that is the credit insurance you sign for at the beginning of the contract that insures the outstanding amount at the time of an emergency such as retrenchment.
The insurance will then cover payments on your behalf for a certain period while you are in the process of finding new employment. The terms of the insurance will differ from creditor to creditor, but this is the first thing you should do.
Each creditor has different requirements but they will provide you with the relevant documentation and/or information necessary to assist in the payment of your claim.
Tick those you have arrangements with off on your list and make sure that you know how long the credit protection will pay for, and how much.
2. UIF
Make sure that you do the necessary to collect your unemployment benefit.
3. Cut costs
* Look at your essential living expenses and pare those to the bone. These include housing, petrol, electricity and water, school fees, telephone costs, groceries, etc.
* Cancel all subscriptions.
* Change cellphone contracts to pay as you go, as your contract allows.
* Do not buy from convenience stores. Buy food on special offer in bigger volumes, for instance a local distributor with weekly specials on fruit and vegetables - buy those and pre-prepare.
* Have a fixed meal plan.
* Switch off lights in areas that are not being used at any particular time.
4. Make arrangements
It is better to let your creditors know about your situation before you fall behind on payments.
* Inform the school, daycare, etc that you have been retrenched and that you will need time to find new employment, and make arrangements for school fees.
* Do not fall behind with debt repayments - it is better to make arrangements with your creditors for smaller repayment amounts than not to pay at all.
* You can always see a debt counsellor to assist you with planning. A debt counsellor cannot put a consumer under debt review who does not have an income, but can assist in how best to distribute the money available to all the relevant creditors and ensure that you are in a good financial position when you resume employment.
* Do not just ignore debt as it does not go away; as soon as legal action starts, the additional costs rise fast and a small outstanding balance suddenly escalates.
5. Draw up a budget
When you know how much money you have available - from the retrenchment settlement and the UIF - do a budget for your household for three months and stick to it.
Finally, by being proactive you will survive the retrenchment and build good financial values for your children.
- Fin24
Consider yourself a savings hero? Or just have something on your mind? Add your voice to our Savings Issue:
* Write a guest post
* Share a personal story
* Ask the experts
