How to Budget Properly During a Job Furlough

A government shutdown that started on October 1 has forced over 700,000 federal workers into furlough. This means they’re not getting paid right now, but they haven’t lost their jobs.

Another group of government employees is still working, but also not receiving pay. Though furloughs are often seen in government jobs, private companies sometimes use them for different reasons, such as money problems or seasonal changes.

If you’ve been furloughed or are worried you might be, it’s important to make smart choices about your money. Here are some tips on surviving financially during a furlough:
 

What’s the Difference Between a Furlough and a Layoff?

 

• Furlough: You are temporarily not working and not paid, but you are still officially employed and may keep benefits like health insurance. You usually have to keep paying your share for these benefits.
• Layoff: Your job and benefits end. Companies often lay people off when making big changes or facing major financial trouble. Layoffs may come with severance pay and options for continued health coverage or unemployment benefits.

While both mean you aren’t getting paid, being furloughed often means you have a job to go back to in the future. But, furloughed people can still be laid off if the business needs to.
 

Steps to Take If You’re Furloughed

1. Apply for Unemployment Benefits

Most people who are furloughed can apply for unemployment. Contact your state’s unemployment office to check if you are eligible. Some government employees can get special federal unemployment benefits.

It can take a few weeks to start receiving payment, so apply as soon as possible. You’ll need to regularly show you’re still furloughed to continue receiving benefits.

2. Make a Simple, Bare-Bones Budget

Look at your spending and see where you can cut back. Try to reduce or pause non-essential spending.

Use your emergency savings if necessary, but try to avoid dipping into them unless you really need to, especially if you don’t know how long you’ll be without pay.

3. Contact People You Owe Money To

If you have debts, like credit cards, student loans, or car loans, reach out to your lenders. Many have special programs for people who are facing tough times, like forbearance or reduced payments.

This helps you prioritize essentials and avoid late fees or credit damage.

4. Find Temporary Work or Side Gigs

Even though you may return to your job, you can look for a temporary or part-time job to help cover your expenses. If you collect unemployment benefits, you must report this extra income, which may reduce your benefit amount or make you ineligible if you earn too much.

Still, extra income can help reduce financial stress and may even lead to unexpected opportunities.
 

When Will the Government Shutdown End?

There’s a lot of worry about how long the current shutdown will last. Many federal workers have already missed paychecks. Some programs, like food assistance (SNAP), are also affected and may pause. There is no clear end date yet, and this is one of the longest government shutdowns in history.

Analysts expect it could last into November, but upcoming events—like open enrollment for health insurance and the Thanksgiving travel season—are putting pressure on lawmakers to resolve the situation soon.
 

In summary:

Furloughs can cause serious financial worries, but taking proactive steps like applying for benefits, cutting expenses, talking to creditors, and seeking side work can help you get through this tough time.

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