The second you lose your job, you've got a fixed amount of income to last you roughly twelve months. This does not mean it will necessarily take you twelve months to find a new job, but you need to be prepared for the long haul, and your unemployment insurance and severance package gives you a set amount of money to live off of until you are rehired. Which means it's time for an honest, no BS assessment of your income and your expenditures. It's time to trim the fat.

The first thing you need to do is figure out how much per month you're going to have to limit yourself to for the next twelve months. Again, it may not take you this long to find a job, but it's better to have extra at the end than run out early. If your severance package lasts six months, take your monthly income and cut it in half. Count on no more than that to survive. Note that the keyword is survive, and that I mentioned nothing about survive comfortably. Things are going to be tight until you find another job, and the sooner you get used to that, the better.

So it's time to look at your expenses and start cutting things out. There are some things that should go right off the bat: Cable, eating out, magazine and paper subscriptions (especially get rid of anything you can get for free on the internet, like the newspaper), and anything you either don't use or can live without. I know cable is going to be a tough one for a lot of people, but the only way you can justify keeping it is if it's bundled with your internet and saves you more money than basic cable would cost. It might also be a good idea to switch your internet to DSL or dial-up. The drop in speed will be quite drastic, and probably annoying, but all you need it for (emphasis: need) is sending your resume to potential employers. Because of this, you probably won't want to get rid of the internet entirely. It is a great way to network, e-mail potential employers, and maybe even find some small side work to make some extra cash. In today's world, the internet is a necessity.

It's also time to start clipping coupons. When you go to the grocery store, which you'll be doing more often anyway, pay attention to what's on sale, and buy a lot of generic brands (generally, they're just as good as any of the name brands). Between clipping coupons, paying attention to sales, and buying generic brands, you should be able to save a decent chunk of money on food without feeding your family any less. The same principles apply to shopping for clothes. Look closely at the clearance racks, and stick to generic brands. There's no need to spend $80 on an Abercrombie and Fitch sweatshirt when a $10 one from Target will keep you just as warm.

Unfortunately, losing your job is probably going to effect your social life as well. Your still employed friends are going to call you and ask you out to dinner, or out dancing, or to movies—to do things you simply cannot afford. And you've got to become good at telling them you can't on account of your lack of income. The best way to do this is to simply suggest that they do something free instead. Many areas have free zoos, free parks, and free nature trails. Or suggest staying in and watching a DVD (much less expensive than going to the theaters). In other words, suggest an alternative. And be up front with the people you care about. There is no shame in getting laid off (as opposed to getting fired; slightly more shame there).

In fact, the Recession has changed America's outlook on the unemployed, if, perhaps, only temporarily. The unemployed used to be viewed by most Americans as lazy and unambitious. They'd find a job if only they would open the want ads and look for one. There's far more understanding now that the overwhelming majority of the unemployed do not want to stay that way. So express no shame in taking advantage of every program out there designed to help workers without work. These programs are here for you, and they'll help you save vast amounts of money, which will help you survive that much longer and, hopefully, get you employed that much faster. Just remember how much help you got when you start getting your checks again and have to pay taxes.

Losing your job effects much more than simply your wallet and your resume. It can be an entire change in lifestyle. But if you spend wisely and save even more wisely, you'll be able to muddle through, and bridge the gap between jobs without doing too much harm to your financial situation or credit score. But it won't be without sacrifices. Only you can choose the things that you're willing to live without. Just keep in mind that what you choose will have a significant impact on your future.

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