Banking Expert: 5 Things You Must Do With Your Money in a Shrinking Job Market
Written by
Gabrielle Olya
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Molly Sullivan
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The U.S. economy shed 13,000 jobs in June — the first decline in nearly four years — and unemployment has climbed to 4.3%, its highest since 2021. With job security increasingly uncertain, financial preparedness is more important than ever.
Kyle Markland, CEO of Municipal Credit Union, spoke with GOBankingRates about how Americans can prepare their finances and bank accounts during a challenging job market.
Build Your Emergency Fund While You’re Still Employed
“The best time to prepare for uncertainty is while you still have a steady paycheck,” Markland said.
Automate transfers from your paycheck to a savings account to serve as an emergency fund. By automating the process, you’ll save consistently without having to think about it.
“Having even a few hundred dollars in reserve can make the difference between paying bills on time or relying on credit cards in a pinch,” Markland said. “A strong financial cushion isn’t built overnight, but consistency is key — start small, start early and let automation do the heavy lifting.”
Apply For Unemployment Benefits Immediately
Losing your job can be a shock, but it’s important to act quickly to protect your financial state.
“Apply for benefits right away if you qualify, since even a modest steady stream of income can help cover essentials and give you time to regroup,” Markland said.
Reach Out to Creditors Before Missing Payments
Markland said that it’s important to contact creditors before you miss a payment.
“Many offer loan relief programs such as forbearance, reduced payments or deferred due dates,” he said. “These options are designed to help you avoid default, but they’re most effective when you reach out early.”
Adjust Your Budget To Fit Your New Reality
Losing a job often means rethinking your spending.
“Create a clear budget to understand what needs to be covered and how long your resources will last,” Markland said. “Cutting back on nonessentials like streaming services or takeout can free up cash for real necessities.”
If you receive a severance payment, stretch it strategically — don’t spend it all in the first month.
Borrow Wisely and Avoid High-Risk Loans
If you do need to borrow money when you’re in between jobs, be strategic about it.
“Explore lower-risk options such as a home equity line of credit (HELOC) or refinancing before tapping retirement accounts,” Markland said. “Early withdrawals from a 401(k) can trigger penalties and long-term setbacks — something many boomers and Gen Xers have learned the hard way. Protect your future by exhausting other options first.”
Markland also said to avoid quick fixes like payday loans, “buy now, pay later” plans and cash advances.
“They may seem helpful in the moment, but they often lead to deeper financial strain,” he said. “If you’re considering one of these options, make sure to read the terms and conditions carefully, especially interest rates charged and associated fees.”
Preparing your finances before a job loss can make all the difference. From building savings to reworking your budget, these steps can help you stay afloat and avoid long-term setbacks.
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