Gloria Nye, a family economist at the Louisiana State University Agriculture Center, suggests you categorize your spending into "needs" and "wants." "The 'want' spending has to stop, and the 'need' spending has to be prioritized," Nye says.
When you've cut back as much as you can, the next step may be to liquidate some of your assets -- by having a yard sale or selling a few items on eBay or Craigslist, for instance. You might even consider bartering with neighbors and friends for household repairs and other services that would otherwise eat into your family's budget.
Manage your mortgage paymentsIf you are having trouble paying your mortgage, call the mortgage company right away and explain your situation. Ask what they can do to help you out, such as perhaps allowing you to defer payment for a month or two. If you need more time -- and more help negotiating -- consult a certified housing counselor, whom you should be able to find through a nonprofit credit counseling agency.
Unfortunately, Nye says she has talked to several homeowners whose mortgage lenders refused to renegotiate the terms until the homeowner had fallen two months behind. "What that does is ruin their credit score," she says.
McClary says, "First and foremost, it will train wreck your credit, which can actually take you out of the running for any other programs that may be available later, such as refinancing."
Put the credit cards awayMore than one-third of Americans do not have any nonretirement savings, according to a recent NFCC survey. With no savings to fall back on, Cunningham says, living off credit cards becomes the default system for getting by.
"Resist the urge to continue your pre-unemployment lifestyle and simply charge your way through the recession," Nye says.
In fact, now that you're in survival mode and operating under a bare-bones family budget, the only good excuse to reach occasionally for a credit card is to pay for an absolute necessity, such as food, says Joseph Birkofer, a Certified Financial Planner and principal at Legacy Asset Management in Houston. And there's another reason not to count on credit cards to tide you over between jobs: "Credit card companies are very good now at gathering data, and the chances of you having your credit cut off the day after your job is let go are pretty high," Birkofer says.
Know your health insurance optionsThe Consolidated Omnibus Budget Reconciliation Act, or COBRA, mandates that if you worked for a company with 20 or more employees that provides a health care plan, you have the option of getting a temporary extension of your coverage after your job is terminated. You will usually have to pay the entire premium, but it will be less expensive than getting individual coverage. Under the 2009 economic stimulus package, the federal government will pay 65 percent of COBRA premiums for up to nine months. After that, you will likely have to pay the entire premium, but it will be less expensive than getting individual coverage. By law, the premium can't be more than the total cost of your coverage before you lost your job plus a 2 percent administration fee.