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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308481  
Subject: Re: Hypothetical Budget Question Date: 10/5/2013 3:51 PM
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I've had long term unemployment a couple of times, and I tended to prioritize the expenses to be cut so that I knew where to start. Typically, we immediately cut things that were easy like no longer going out to dinner or spending money on entertainment, and cutting back other expenses that were discretionary or had room to cut without really feeling it much like reducing the grocery bill by buying cheaper cuts than I typically purchase. Daycare, however, was always at the bottom of the list of things to be cut because I always expected that I would go back to work, and finding the kids daycare slots was a difficult thing to do.

We only have basic cable, so I've not considered cancelling that, and it is bundled with phone and internet, so separating these things out can cost more. If, however, I had some premium cable stations, those would certainly be cut.

I also found that some expenses were reduced a lot just by not having to go to work like fuel for the car because I wasn't driving anywhere, so some of this helps as well.

I have always planned for the efund by being defensive in our planning to start with, such as having a mortgage that only requires my paycheck. This allowed us to need a smaller efund, but it also gave us some flexibility in that as long as one of us was bringing in an income, we could stretch quite a ways until we really had to do something drastic.

I've been out of work for up to a year, and we've been able to weather that by using our efund, having DH bring in some income, and having unemployment for part of that, but my target efund has generally been 1 year with no income, so I also know we can go a really long time without having to make major changes, and that has helped tremendously in terms of stress management during a tough time. I realize that if you don't have such a significant efund, this won't help you now, but perhaps increasing it later might help in the future instead.
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