A strike can be hard on your money — here's how to manage it

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It's the summer of strikes. While all eyes are on Hollywood, where 160,000 actors and 11,000 writers have joined picket lines, an even bigger strike could happen on August 1 if 340,000 unionized UPS employees make good on their threat to walk out.

If you're on a picket line (or expecting to join one), your finances are likely in for a rough ride. CNBC Select breaks down expert advice on how to make the most of every dollar while you're on strike.

Generally, when you go on strike, you won't be getting paychecks from your employer. You're also most likely not eligible for unemployment benefits (although, there may be rare exceptions due to state laws or your personal circumstances). On the other hand, your union may have a strike fund and provide members with strike pay to help them with their basic financial needs.

For example, as UPS Teamsters are preparing for a potential strike, the union has published a post about strike benefits. These include $520 per week for regular package car drivers who pay $104 in monthly dues and $250 per week for part-timers who make $20 per hour and pay $50 per month in dues. SAG-AFTRA runs a few emergency financial assistance programs, including for loss of work due to a strike. WGA also has a strike fund and can offer no-interest or low-interest loans to members.

Certain non-profits can provide help as well, such as the Entertainment Community Fund which can support entertainment workers who can't cover their basic living expenses.

As for benefits, such as health insurance, you can't lose them if you're part of a legal strike. At the same time, you also might not be able to use them while the strike lasts.

"My first tip would certainly be to understand how your medical or health insurance would be impacted by being on strike," says Kenneth Chavis IV, certified financial planner and senior wealth counselor at Versant Capital Management.

Look up what your union can offer, which can include fringe benefits or other forms of assistance. If you can't find that information, reach out to the union directly.

Some strikes last a few weeks, while others might continue for months. In either situation, you want to be financially prepared and continue covering your living expenses.

Ideally, you have a high-yield savings account with a strong APY and minimum fees (we recommend LendingClub LevelUp Savings) where you keep your emergency fund that has three to six months' worth of expenses. Unfortunately, nearly one in four Americans have no emergency savings at all, and 30% say they have less than they need to last them three months.

Whether or not you have savings to lean on while you're on strike, here are a few things that can help your finances.

Seek out other income — if you can

When your main source of income vanishes, finding a new way to earn money becomes your biggest priority. Chavis suggests considering a side hustle, odd jobs or even a temporary position if the strike is prolonged.

Before you go ahead and find a new gig, make sure it's not against your contract or the strike's rules. For example, your employment terms might prohibit you from working for competitors or even specifically engaging in other paid employment while on strike.

The union can also limit what kind of work you can and can't do during a strike. For instance, it may not allow working in a certain field or performing specified types of jobs. SAG-AFTRA members, for example, can work on TV, radio and digital commercials, appear in music videos and narrate audiobooks — but can't do most on-camera work, as well as any promotions, unless the project receives permission from the union.

And finally, if you want to support the union's efforts, it's wise to leave enough time outside of your additional employment for picketing. This way, you can still demonstrate solidarity while earning an income.

Create an emergency budget

Whether you're using a secondary job or your emergency fund to support you, you need to modify your budget to stretch your money as far as it will go.

According to William Bevins, a certified financial planner in Franklin, Tennessee, you need to go into preservation mode if you don't have enough money tucked away.

"Can I cut off my Amazon Prime membership or can I cut off my Disney+ membership?... definitely take a look there and try to reduce costs as much as possible."

This may require going through your expenses with a fine-toothed comb, looking for any opportunities to cut costs. A free budgeting app can help. CNBC Select recommends Mint, which connects to your bank accounts, organizes your transactions into modifiable categories and allows you to set budgets and goals. PocketGuard is another great option that can help you closely watch your spending.

Be proactive

When it comes to bills and financial responsibilities, you want to be proactive if you know there's a possibility you'll be late with your payments. The key is to talk to your financial institutions before you miss any due dates.

"If I'm a member of the union, and I know we're gonna strike and this could be prolonged, nothing stops [me] from picking up the phone and calling [my] bank and saying, 'Hey, I'm involved in this strike'," Bevins says. "Explain what's happening with your work environment."

According to Bevins, after the pandemic and all the bumps the economy has been through in recent years, banks are sensitive to such requests.

You can get in touch with your auto lender and explain that your circumstances are temporary — and they may offer you a loan extension, meaning you can skip several payments by extending the loan's maturity date.

The same goes for your credit card issuers. You may be able to move the payment due date or qualify for relief options.

Some lenders even advertise that eligible customers can skip a monthly payment. For example, if you have a PenFed auto loan or credit card, this credit union provides such an option for qualified members.

Further, housing is probably your biggest expense, and communication with your landlord or mortgage lender can help ease your (monetary) pain.

"I would talk to your landlord ahead of time and explain the situation," Chavis recommends. "Maybe even communicate what some of your plans are to avoid being late next time."

If you have a mortgage, contact your mortgage company as soon as you can. Some options they may offer include loan modification, which reduces your monthly payment, or mortgage forbearance, where mortgage payments stop completely for a period. To qualify for these options, you'll usually need evidence of financial hardship, such as bills and other documents showing your expenses, income, and assets.

Know your financing options

Chavis also suggests being proactive about applying for any financing you might need to see you through the strike.

Of course, it's best to avoid adding to your debt when you're experiencing financial troubles. But when choices are slim, borrowing money to prevent your car from being repossessed (for example) is the smart move.

"It might be helpful to do it right at the outset of the strike, as opposed to down the road because you can show income that you have right leading up to the strike," Chavis explains.

This will also help you avoid getting into toxic types of debt, such as high-interest credit card debt or predatory loans, including title loans or payday loans — types of financing people turn to when they're out of options.

If you know your financial situation is about to get difficult, look into safer alternatives from the get-go. For example, you can apply for a 0% APR intro credit card which doesn't charge interest on purchases for a specified period. Some good choices include the Wells Fargo Reflect® Card which currently boasts a 0% intro APR for 21 months from account opening on purchases and qualifying balance transfers (17.49%, 23.99%, or 28.24% variable APR thereafter). Balance transfers made within 120 days qualify for the intro rate, BT fee of 5%, min: $5. The U.S. Bank Visa® Platinum Card is another great option with 0% APR for the first 18 billing cycles on balance transfers and purchases (18.24% - 29.24% variable APR thereafter).

A personal loan can be another type of financing to consider. If you have a good credit score, you can get a comparatively low interest rate. CNBC Select's top picks for personal loans include LightStream Personal Loans with flexible terms and PenFed Personal Loans if you don't mind joining a credit union.

Finally, you can tap into assets that you already have. If you've built plenty of equity in your home, you can use it and get a home equity line of credit (HELOC) at a low interest rate. Or, if you have a 401(k) plan, you can also borrow against its balance — the loan payments along with interest will go back into your retirement account.

That said, remember that these aren't risk-free options either. If you default on your HELOC, you could lose your home. And if you fail to pay back a 401(k) loan, and you're under 59½, you'll owe taxes on it, as well as a 10% penalty. Not to mention, if you do pay on time, you'll still have missed out on the potential investment growth of the funds you've borrowed. For these reasons, carefully consider the possible implications before you take out a loan against your assets.

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Financially surviving a strike can be a tall order. Whether you need to take on another job or borrow some funds, don't wait till the last moment. The same is true for contacting your issuers and lenders. There's no telling how long a strike could last, so make sure your finances are prepared for the long haul.

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* Information about the U.S. Bank Visa® Platinum Card has been collected independently by CNBC Select and has not been reviewed or provided by the issuer of the card prior to publication.

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