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Related topics: savings, budgeting, health, insurance, income, frugal, emergency fund

Being unemployed has taught Cindy, a former airline contractor from Cincinnati, an unusual lesson: If you want to save money, try freezing your milk.

"I had no idea that you could freeze milk, but it turned out to be a brilliant discovery," said Cindy, who asked not to be identified for fear of people knowing she lost her job. "Milk is not cheap and being able to store it in the freezer has been incredibly helpful to manage my expenses."

This revelation fundamentally changed her approach to grocery shopping and saved her valuable dollars in the process. Now, rather than buy a new carton of milk each week, Cindy, 34, has taken to buying milk in bulk, freezing it, and taking out a carton only when she actually needs it. She applies the same technique to buying loaves of bread as well.

It might sound like an extreme way to live, but to Cindy, who lost her job last fall, "desperate times call for desperate measures." She was among the nearly 6 million recently laid-off Americans who started collecting jobless benefits in the third quarter of 2010.

Like many of these workers, Cindy has little choice but to lean heavily on her weekly unemployment check of $330 to help pay her bills. But while she appreciates the money, it is still only about 40% of what she earned at her previous job. As a result, she must resort to all sorts of financial acrobatics to make ends meet, whether that means forfeiting eating out and replacing her cell phone with Google's free calling service, or negotiating with her energy company to freeze her heating bill for three months so that the cost doesn't go up beyond her means.

The difficulty that Cindy and other out-of-work individuals around the country are running up against is that unemployment benefits are rarely enough for most Americans to live on for very long.

"I am surviving on these cost-cutting measures for right now, but it's very tight getting by and I'm not sure how long it will last," she said.

A fraction of a paycheck

The goal of the unemployment insurance program, according to the Center on Budget and Policy Priorities, is to provide people with about half their normal wage. However, it almost never works out that way. The average American collected $295 in weekly unemployment benefits in the third quarter of 2010, according to the most recent government data. But the average weekly salary in that same quarter was $865, which means the jobless benefits replaced just over a third of the average worker's salary.

In fact, even as Congress has successfully extended the length of time one can collect jobless benefits four different times in recent years, from 26 weeks to 99 weeks, the actual amount that the average person collects relative to the wage he or she earned before becoming unemployed has slightly decreased. In 2007, before the recession began, unemployment benefits compensated for 35.6% of one's last salary. In the third quarter of 2010, that number was 34.2%.

Part of the problem, according to Rebecca Dixon, a policy analyst at the National Employment Law Project, a national advocacy group for low-wage workers, is that only a handful of states actually adjust the amount of benefits offered to meet annual increases in wages. In the states that do, like Pennsylvania, New Jersey and Kentucky, benefits tend to be significantly higher and come closer to meeting the standard of living that workers might have grown accustomed to. New Jersey, for example, offers maximum jobless benefits of $598 a week, nearly twice the national average.

But whether you're living on half your normal salary or a third of it, getting by on these benefits alone is nearly impossible.