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Being made redundant can be upsetting and stressful, particularly since hefty redundancy packages are largely a thing of the past. People who find out they’re being made redundant are often worried about paying the bills and even making ends meet.

If your employer tells you they’re letting you go, there are things you can do to help make sure you survive financially. Even if your job seems secure at the moment, there are important steps you can take to protect your income should you find that you’re made redundant in the future.

Here’s everything you need to know:

1. Before you are made redundant

First of all, when times are tough, it is vital that you don't bury your head in the sand and hope for the best. Instead, you must prepare for the worst as best you can so that you’re not caught off guard. 

Many people will know that their employer is struggling long before redundancies start, but what can you do to prepare?

Know your rights:

If you’re worried about being made redundant, look at your employment contract. It will set out your rights in terms of pay and notice. You can work out how much redundancy pay you might get by visiting the .

Know the law:

You should also find out what your employer must legally do before making you redundant. This will help ensure you are treated fairly and that your employer provides all the help and support you are entitled to.

Consider insurance

There are various insurances available that are designed to help bridge the gap if you lose your job. These include mortgage payment protection insurance (MPPI), payment protection insurance (PPI) and short-term income protection insurance (STIP).

MPPI and PPI policies mean you can keep paying specific bills such as mortgages or loans and other debts. They’re usually linked to a specific line of credit, so you’ll only be covered for that particular payment.

STIP will pay out a proportion of your income, typically 50-60% for a specific period. You can use your money where it is most needed, rather than being tied to a specific repayment.

Save, save, save

Experts suggest that everyone should have the equivalent to at least three months’ salary saved in a rainy day fund. Building up this pot will give you breathing space if you’re made redundant and ensure you can pay your bills while you look for another account. You should make sure you build this up as soon as you’re in work, rather than trying to do it in a panic when you think redundancy might be around the corner

Choose a savings account that pays the best rate of interest you can find, while still allowing you access to the money as soon as you need it. Even a relatively small savings buffer is better than nothing.

If you’re struggling to find spare cash to save at the end of each month, think of ways you can cut back on household bills such as switching utility providers, cancelling subscriptions or setting a grocery budget. Don’t forget, if you do make savings on your household bills, put the money away for later. 

If you already have savings,Ìýshop around to see if you can get a better rate -remember that some providers offer better rates of interest to new customers than they do to existing savers.

Check your current provider's terms and conditions before you move your money - to make sure there are no penalties. 

Finally, make sure you know how to go about withdrawing your money from an existing savings account when you need it. In particular, check whether you must give notice before making withdrawals (usually up to 30 days, but maybe more).

Get your CV up to date

Update your CV and make sure it is as good as it can be. You will need to be ready to get job hunting quickly if you’re made redundant. This is particularly true if your company makes mass redundancies in your department or job role. You’ll likely all be competing for similar opportunities so it pays to be quick off the mark.

2. If the worst happens and you are told you may face redundancy.

If this happens, your employer must enter into a period of 'consultation' with you. This is the law and means they may not simply dismiss you.

During a consultation period, the employer must tell you their plans and the reasons for them. They must tell you what will happen during the consultation period and when a decision will be made. They also have to listen to your concerns and opinions throughout.

Depending on how many people the company plans to make redundant, it must give either 30 days consultation (for 22-99 redundancies) or 90 days (for 100 or more). If the company plans fewer than 20 redundancies, the length of the consultation person will be set out in your employment contract.

This is likely to be a highly stressful time, but it is important that you keep a clear head and . That means understanding the process and making sure you get exactly what you are entitled to, whether you keep your job or not.

3. After the event

If you are unfortunate enough to be made redundant, there are several things you need to consider - to help soften the financial blow. This includes where you can find financial support if you need it and how to make sure you get back on your feet as soon as possible:

Redundancy money

It is possible that you will receive a lump sum redundancy payment as part of a settlement with your employer. Even if the amount is small, it could make all the difference to your family finances – so don’t blow it all on a shopping spree and don’t leave it in your current account where it will be chipped away at all too quickly. 

Put the money in an instant access savings account where it can gather interest but still be available when you need it. If you already have savings, you might also consider using them to pay off debts that demand regular monthly payments if you can – particularly those subject to high-interest rates, like credit cards. 

Remember, while using savings or redundancy cash to clear debts makes good financial sense – your first priority should be to make sure you have money available to pay the bills each month. Don’t spend anything if it could leave you short on minimum repayments elsewhere.

Household finances

Clearly, if you do lose your job, money is likely to be an issue. See where you can save money on everything from utilities to the weekly shop. 

For instance, check if you could save money by switching energy supplier, ask yourself if you really need Sky Movies, and shop around to see where you can cut your grocery bills. 

Finally, look at any monthly payments you make, for instance on credit card debts. Consider transferring your balance to a new card, with a 0% offer on balance transfers. Shop around to find the best deals and time your transfer to make sure you make the most of the interest-free period when you really need it.

As a last resort, you might want to consider asking if you can take a payment holiday or your mortgage or any other debts. This could have implications both in terms of the interest you pay and on your credit rating, so explore other avenues first.

Benefits

You may be entitled to a variety of benefits while you are out of work and seeking a new job. Read our guide to make sure you get all the benefits and financial support you are entitled to from the government.

Tackle problems head-on

Despite your best efforts to be prepared, it is possible that, following redundancy, you will have problems making regular mortgage,Ìýloan or credit card payments, as well as paying your bills. It is vital that you face these problems head-on and deal with them, rather than letting them fester.

First of all, prioritise your debts (and regular bills) and deal with the most important ones first – for instance, contact your mortgage lender and utility providers as a priority. Tell them about your situation and see how they can help you to resolve it. 

For instance, if you contact your mortgage lender, tell them you are receiving Jobseeker's Allowance and trying to find work as soon as possible. It is likely they will give you somewhere between three- and six-months grace, or at least explore other ways to help you lower or meet your payments.

If you are having serious problems paying your mortgage, there is help available from the government.

Get help finding work

Clearly, finding a new job is likely to be your number one priority. For a range of advice and resources designed to help you find work, visit .