Our top picks of timely offers from our partners

More details
One of the longest 0% intro APR offers plus, no annual fee
Upstart Personal Loans
Learn More
Terms Apply
Loans up to $50K - great option for those with fair to average credit
$300 statement credit welcome offer after meeting spending requirements
First Tech Personal Loan
Learn More
Terms Apply
Our top pick for a personal loan with long repayment terms from a credit union
$200 welcome bonus offer plus, earn up to 5% cash back on eligible purchases
Select is editorially independent. We earn a commission from affiliate partners on many offers, but not all offers on Select are from affiliate partners. Read more about Select on CNBC and on NBC News, and click here to read our full advertiser disclosure.

3 tips to stay calm during a layoff and still reach your financial goals

Select dives into ways to keeping calm during a layoff, even when paying off debt, with three helpful tips from somebody who has been there before.

Photo courtesy of Michael Lacy
Select’s editorial team works independently to review financial products and write articles we think our readers will find useful. We earn a commission from affiliate partners on many offers, but not all offers on Select are from affiliate partners.

In 2014, Michael Lacy and his wife set the ambitious goal of paying off $21,000 in credit card debt and auto loans. Eight months into the journey, Lacy was laid off, an experience that many Americans are facing amid the ongoing coronavirus pandemic.

To make things harder, Lacy's wife has a chronic autoimmune condition, which flared up — a common symptom of stress — and she had to take two weeks of unpaid leave from her job.

But the Lacys kept their cool and adjusted their plans. They still managed to pay off their debt in 16 months, just four months longer than their original goal.

Below, Lacy shares his three tips for keeping calm during a layoff, even when paying off debt.

1. Know what you care about

Before Lacy's layoff, the couple had given considerable thought to what they wanted out of life. They bonded over a shared love of travel and the desire to have more time to spend at home raising their future kids. After having these important discussions, Lacy recalls that getting laid off did not shake him as much as one might expect.

"We had already had the important conversations with each other about what we wanted our life to look like. I was determined not to fail," he tells Select.

With a clear vision in mind, Lacy picked up a gig delivering food while he sent out resumes and prepared for interviews. Knowing that his hard work was inching him closer to the future he and his wife envisioned carried him through the ups and downs.

2. Accept where you are

Lacy and his wife were motivated by the future, but they knew they couldn't get there without starting exactly where they were.

There's a lot of anxiety and pressure that comes with losing your job, says Lacy, especially when you're in debt. But you must recognize this panic without putting pressure on yourself to act on it, he advises.

Before making any long-term decisions, such as starting a business, opening a new credit card or taking on a debt consolidation loan, try to recognize what's fueling your decisions, says Lacy.

If it's stress, take a minute to relax if possible.

"Sometimes, it's OK to not be OK," explains Lacy. "Even now during this pandemic. Everyone is saying this is a great time to start a business. But often times, when we do things out of panic, we get ourselves into worse situations."

3. Know what's leftover after your expenses

After you've identified what your most important goals are and given yourself a moment to collect your thoughts, it's time to figure out how much money you spend versus how much you expect to bring in. 

"Before you do anything, lay out your expenses next to any income you're anticipating, whether its unemployment, your stimulus check, alimony, child support, etc.," says Lacy.

Then take a minute to calculate the difference between your expenses and income. Even if you're not bringing in what you need to live on, this way you know exactly how much shortfall you're facing.

"Even if you have a $500 deficit, you can reach out for help," says Lacy. "Lenders are being gracious right now." 

Lacy recommends calling your lenders and asking if they can reduce your payments or your interest rates. Highlight your good history as customer, he advises, whether by reviewing how many on-time bills you've paid or reminding them of how many years you've been a loyal account holder.

Once you remind them how valuable you are to their company, "ask 'what can you do to help me this time?'" advises Lacy. Even if it doesn't solve everything, "you might see that $500 deficit go down to $100, which is a lot more manageable."

If you find you need a little bit of wiggle room to pay off lingering debt or cover your essentials while you hunt for a new job, you might consider a credit card with an introductory 0% APR for balance transfers and purchases. Most require good to excellent credit scores, but if you qualify you could pay off expenses with 0% APR over time.

The Citi Simplicity® Card, for example, offers a long 0% intro APR period for 21 months on balance transfers from date of first transfer and 0% intro APR for 12 months on purchases from date of account opening (after, 15.49% to 25.49% variable APR; balance transfers must be completed within four months of account opening).

And if you are looking for no interest and a rewards program, the Citi® Double Cash Card offers 0% for the first 18 months on balance transfers (after, 14.74% - 24.74% variable APR; balance transfers must be completed within four months of account opening) and 2% cash back: 1% on all purchases and an additional 1% after you pay your credit card bill.

Above all, Lacy advises that you lean on your support systems and remember that your situation is temporary.

"There were days where I was crushed, and my wife uplifted me," he says, "and vice versa. We just kept encouraging each other through that."

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.