“I was doing very well,” said Schultz-Tarnopol.
Without dismissal and without job prospects, Schultz-Tarnopol felt paralyzed. “I couldn’t do anything. I couldn’t focus, I couldn’t move forward, I couldn’t find a good job.”
Over the next decade, he lost his car and home, received food stamps, enrolled in Medicaid, and filed for bankruptcy twice.
Since then, Schultz-Tarnopol has managed to rebuild his life, little by little, and although his quality of life has not returned to the way it was before the 2008 recession, he says he is close. When another financial crisis hits the United States, he says he feels much more prepared.
What Schultz-Tarnopol went through is not unusual, according to Natalie Colley, associate adviser to Francis Financial. “You are going to lose your main source of income at some point in your career.”
Colley, who works primarily with single women going through a financial transition, says her money history plays a role in how she handles financial change.
Here are some lessons that Schultz-Tarnopol learned after the Great Recession that could help you survive a financial crisis:
It’s okay to ask for help
About a year after she was fired, Schultz-Tarnopol’s sister dragged her “kicking and yelling” to apply for Medicaid and food stamps. It made all the difference.
“A lot of people are prejudiced about social programs,” said Schultz-Tarnopol. “That doesn’t make sense. It’s for times like this. It’s for the people who need it. And at some point, you won’t need it anymore.”
Medicaid, in particular, saved the Schultz-Tarnopol family twice, when in 2011 their son had to undergo heart surgery. And then in 2013 Schultz-Tarnopol herself was diagnosed with breast cancer. Medical costs ended up being covered at 100%.
While using the government services available to you is important, Colley says financial aid doesn’t just have to come from the government.
“Call the people you owe money to,” recommends Colley. “Call your credit card providers. Call your landlord. Call your student loan providers. And what you will find is that companies are more than willing to work with you, especially if you have been a good customer in the past. ”
Be prepared to take a financial hit when you get hired again
Four and a half years after being fired, Schultz-Tarnopol was hired as a paralegal. She started earning $ 21 an hour, and she was cut off all government aid.
“The moment you start making money, they say, ‘No more food for you, no safer for you.’ And you say ‘I still can’t afford it.’ “
Still digging up debts, he had to make some difficult decisions:
“Sometimes I couldn’t pay my electric bill. I just had to ask myself ‘What was the most important thing at the time?’
The key is to plan as far in advance as possible, says Colley.
“Temporarily move in with a relative to lower your overall costs. Save the money to help you increase the amount of money you have available during those few months, while your salary is ultimately less than what you were receiving in benefits.” .
Although the difficult transition may make looking for a new job seem futile, Colley says it’s worth it.
“You can stay in this situation where you receive benefits, that’s the way you will live the rest of your life. Or you can make the transition. [and] Find a career where your earning potential is far greater than those benefits. Ultimately, it will be more rewarding and set you up for long-term success. “
Reduce your life to fit your wallet
Schultz-Tarnopol filed for bankruptcy twice, once in 2008 and once in 2018 after sinking into credit card debt. The second time he decided he had finished piling up his credit card bills.
“People just use the credit as if they can afford it. And what I learned is that if I can’t pay it in cash, I don’t deserve to have it.”
Since then, he has cut almost everything: rent a budget apartment. She cooks more, although she doesn’t like it. And when you go shopping, you make sure to make a list to avoid filling your cart with unnecessary clothes or groceries.
Colley says that using a credit card has real advantages, if you can pay it every month.
“[Good credit] It allows you to get a better rate on the loans you are given, such as getting a mortgage. It can also come into play when you’re looking to rent a new apartment … even request a new cell phone plan. “
The key, according to Colley, is to know yourself and your spending habits.
“When it comes to good credit, we’re talking about getting additional access to more debt. And if that’s something you can’t handle, then for some people, the best option is really just say, you know what, a credit card doesn’t is for me “.
A good rule of thumb is to save first, then spend. Colley recommends having at least six months of living expenses in a savings account at all times. You should aim to save 20% of your gross income, she says, “so that if you are in a situation where you lose your job, you are not losing 100% of your salary.”
Let fear inspire you
When Schultz-Tarnopol began to see the stock market crash in late February, he knew he was going to take a hit. She was fired … again. But unlike 2008, she had another job to turn to.
“I think I am always afraid that if I lose one job, at least I have the other. Which is exactly what happened.”
The decision to get a second job in 2018 was a way to increase his income when his children started college, but also as protection against his fear of putting too much power in the hands of an employer.
“It just made me feel lighter, knowing I had a plan B. That I didn’t have a single boss to stand up and do the right thing. At least if I have two different bosses, I have a much better chance of everything being fine.”
Colley calls this “job diversification.”
“How can you make money in parallel? Learning how to generate income on your own can really help you if you lose your main source of income.”
About three and a half months after Schultz-Tarnopol lost her part-time job, she was rehired. While the past few months have stretched her financially, the experience barely shook her, especially when compared to what happened in 2008.
She attributes her new emotional strength to making sure she eats well, meditates, sleeps, and exercises. And her sense of self-awareness.
Before 2008, “I didn’t know anything about what was happening in my world. I didn’t get involved. I barely voted, but I hoped everything would be happy and peaceful.”
“This time, my eyes are wide open.”
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