About 651,000 Americans lost their jobs in February, boosting the national unemployment rate to its highest level in 24 years, according to statistics from the US Bureau of Labor Statistics. And a new survey from TrueCredit.com shows one in four adults are worried about losing their jobs this year.
“There is no better time for consumers to make sure their finances in order, work on paying down debt and manage their budgets to be prepared for the possibility of losing their source of income,” said Lucy Duni, vice president of consumer education at TrueCredit.com, a subsidiary of Chicago-based TransUnion, one of the leading credit reporting agencies.
With so many people looking for work, competition for jobs are intense-and TrueCredit.com estimates nearly one in six potential employers are using pre-employment credit reports as part of the applicant screening process. So in addition to polishing resumes and portfolios, job seekers should also review their credit. To better prepare for a potential layoff and possible job search:
- Reduce spending. It’s a good idea to assess your spending and either create or reassess your budget.
- Build cash reserves. Try to have enough in savings in cover your living expenses for at least six months.
- Pay down debt. As long as you have a job, try to pay off some of your existing debt. To protect your credit, try not to use more than 35% of a credit card’s maximum available credit.
- Pay promptly. Make sure you pay at least the monthly minimum amount due on each credit card before the due date.
- Limit new credit applications. Think twice about any new applications for credit, especially because multiple applications in a short time can negatively affect your credit score.
- Review your credit report. Make sure anything a potential employer or creditor sees about you is accurate.