Experts in the UAE highlight that the initial two days after experiencing a job loss or a reduction in salary are extremely important for making decisions and managing the situation effectively.
UAE specialists say the first 48 hours are critical after losing a job or facing a salary reduction.
In such situations, taking practical steps becomes essential—this may include discussing rent adjustments with landlords, applying for ILOE insurance support, or even relocating to a more affordable home. Rather than relying on uncertainty or waiting for circumstances to improve, individuals are more likely to cope successfully by making timely, proactive decisions.
As a growing number of employees across the UAE deal with salary reductions, temporary leave arrangements, or even job losses, financial specialists caution that such changes can pose a serious risk—especially for individuals who depend heavily on their monthly income to meet everyday expenses. For those without savings or financial buffers, even a short interruption in earnings can quickly escalate into a major crisis. Experts emphasize that the actions taken immediately after such setbacks can play a decisive role in determining whether a person manages to stabilise their situation or faces deeper financial difficulties.
According to professionals in the field, the first 48 hours following a loss of income are particularly critical. During this period, individuals are encouraged to assess their financial position clearly and take practical, timely steps instead of delaying decisions. The difference between regaining control and falling into prolonged hardship often depends on how quickly and effectively one responds.
Rashmi Rajkumar, a Partner at ECOVIS JRB Chartered Accountants, highlighted that while financial advice often recommends maintaining an emergency fund that covers six months of expenses, this goal may not be achievable for many people in reality. Instead of focusing on ideal scenarios that may feel out of reach, she suggests adopting a more practical mindset. She encourages individuals to concentrate on extending their “financial runway”—the amount of time they can sustain themselves with available resources—rather than reacting with panic.
By prioritising essential expenses, reducing non-critical spending, and exploring immediate options for support or income, individuals can create breathing space during uncertain times. This approach, she notes, allows for more thoughtful decision-making and improves the chances of navigating financial setbacks more effectively.
Rashmi emphasised that the initial two days after facing a financial setback carry far greater importance than the weeks that follow. She explained that individuals should first gain a clear understanding of how long their available funds can sustain their current lifestyle, often referred to as their financial “runway.” Having this clarity allows for better planning and avoids reactive decision-making driven by stress.
She also stressed the importance of early communication, particularly when it comes to major financial commitments such as rent. Rather than waiting until a payment becomes overdue or a cheque risks bouncing, she advised reaching out to landlords at the earliest sign of difficulty. In many cases, property owners are more willing to cooperate and offer flexibility if they are informed in advance.
Similarly, she noted that educational institutions can also be more accommodating than people expect when it comes to fee payments. However, this flexibility typically depends on proactive engagement. Initiating conversations early, rather than delaying them, can open the door to workable solutions and reduce financial pressure.
A Dubai-based resident, Mohammed K, who recently found himself placed on a six-month furlough, described how he responded immediately after learning about the situation. Rather than delaying action, he chose to reach out to the key institutions connected to his financial responsibilities. He contacted his landlord, his bank, and the school attended by his children, informing each of them about his current circumstances. By communicating early and clearly, he was able to open discussions around temporary adjustments. According to him, his bank agreed to pause his loan repayments for a period of three months, offering some short-term relief. While neither his landlord nor the school reduced their fees, they were willing to restructure payments into more manageable monthly instalments, which helped ease the immediate financial pressure.
Experts stress that for individuals who do not have savings to rely on, the response must be grounded in practical and lawful steps. Salam Pappinissery, CEO of Yab Legal Services, cautioned that while financial stress may push some people to look for quick ways to earn money, it is essential to remain within the boundaries of the law in the UAE. He explained that those considering freelance or part-time work must ensure they have the proper legal permissions, such as a work permit or a No Objection Certificate (NOC). Taking on unofficial or unregistered work may seem like a quick fix, but it carries serious consequences, including fines or even deportation.
Entrepreneur Ellen Mannaert highlighted a different but equally important challenge: the emotional and psychological barrier that often prevents people from taking necessary action. She pointed out that personal pride or the desire to maintain a certain lifestyle can stop individuals from making tough but essential financial decisions. In her view, people should not hesitate to liquidate non-essential possessions in times of financial strain. Items such as luxury accessories or extra gadgets can be sold to generate immediate cash flow. She emphasised that in difficult periods, having liquidity is far more valuable than holding onto possessions that primarily serve as status symbols. Letting go of such items, she noted, can be emotionally difficult because it often involves redefining one’s self-image and stepping away from social expectations.
Financial wellness consultant Beth Clay offered insight into the psychological side of financial setbacks, explaining that a person’s internal narrative can sometimes be more damaging than the actual reduction in income. She encourages individuals to be honest with themselves as well as with financial institutions and family members. According to her, people tend to react in one of two ways: either they avoid dealing with their finances altogether, or they make rushed decisions driven by panic. She believes a more effective approach is to pause, assess the situation calmly, and develop a clear plan.
She shared an example of a client named Mostafa, a technology professional who lost his job after more than a decade in the UAE. Initially uncertain about his situation, he calculated his end-of-service benefits along with his reduced monthly expenses. This exercise revealed that he had enough funds to cover approximately seven months of living costs. Realising that he had this financial cushion provided him with a sense of relief and allowed him to approach his job search more strategically. Instead of accepting the first opportunity out of urgency, he took time to find a suitable role and eventually secured a new position within four months, earning a higher salary than before.
Across these perspectives, a common theme emerges: ignoring the problem or delaying action can worsen the situation. Whether it involves renegotiating rent, applying for financial support such as insurance schemes, or even downsizing to a more affordable home, taking proactive steps is essential. Acting early not only helps manage immediate challenges but also creates a clearer path toward recovery.
Ellen Mannaert summed up the broader lesson by noting that such moments, while difficult, can also serve as an opportunity for honest reflection. Rather than viewing financial setbacks as a permanent loss of identity, she suggests seeing them as a chance to reassess priorities and make more grounded decisions about the future.
