A general strike can eventually lead to better pay, better benefits, and better working conditions. In the leadup to negotiating these perks, however, your financial well-being will be put to the test. It’s hard to make ends meet when you can’t collect your usual paycheque until your employer and union agree to a new collective bargaining agreement.
Putting a cork in your cashflow like this can be challenging for anyone. But for those are building their credit score, a strike can be particularly frustrating. You spent a long time improving your credit score, and it would be easy to undo all your hard work during a long-term strike.
Before you start stressing out about your credit score, keep scrolling. Whether you’re currently on strike or simply want to be prepared for one in the future, these tips are here to help!
Tap Into Savings
You may not have started your emergency fund with a strike in mind, but a strike is exactly the kind of emergency that these savings can help you with.
If you reached the golden target of six months of living expenses, you have the next six months’ worth of expenses covered by your savings. Don’t worry if you have less tucked away. Most strikes wrap up long before six months — even the longest strike on record was only 100 days.
Cover Your Minimum Payments
A line of credit comes with minimum payments for a reason. In an emergency, you can rely on these small payments to keep your account in good standing without worrying about paying your entire bill.
The minimum payment may not be enough to shield your credit score from damage, as you will carry a balance from month to month and increase your credit utilization ratio. But it will save you from late fines.
While not ideal, a high utilization ratio is not the end of the world. With a growing number of banks, credit unions, and lenders supporting credit inclusivity, you may find borrowing options in the future.
Perhaps you have a question: what is credit inclusion? It’s a financial campaign that ensures people of all financial walks of life have access to the basic tools and services they need to manage their money. This might include online personal loans, lines of credit, insurance, and bank accounts.
Strip Down to an Emergency Budget
Your minimum payments are important, but they aren’t the only thing you have to prioritize. You have plenty of other expenses that you must pay to avoid late fines, credit damage, and other penalties.
To find your priorities, go through your monthly statements with a highlighter and mark the essentials. For most people, this includes housing costs, utilities, basic groceries, and essential transportation costs.
Anything that you don’t highlight is something to avoid. While cutting back on all the fun things in life is hard, try to remember this isn’t forever. Eventually, your union will come to an agreement, and you can return to your usual spending.
Reach Out to Your Union
Lastly, you’ll want to talk to your union rep about any potential financial assistance they can offer. There’s a good chance some of your union dues went into a strike fund. Your union may disperse these funds amongst union members during an active strike. While it may not reflect your usual paycheque, it is better than nothing.
Pick Up a Side Hustle
Getting a second job when you aren’t on the picket line can smooth things over. Your part-time paycheque combined with your strike fund payout may be enough to tide you until the end of your strike.
Striking can be stressful, but it almost always works in your favour. Like the most recent Hollywood writer’s strike, collective bargaining has the power to improve working conditions. Let this motivate you as you take on the hard task of managing your money without a paycheque.