Most of the time, people don’t know in advance that they’re going to lose their job. The news comes as a complete, and unwelcome, surprise. If you know you are about to get an income reduction or lose your job, some advanced planning will transform a potential calamity into an opportunity.
Here are 3 strategies to prepare for an impending change in your finances:
1. Revisit Your Budget
Trim whatever you can out of your spending. Look at your cable TV subscription, your cell phone or home phone plan, your insurance, and any other monthly expenses to see what you can reduce or eliminate. You can usually save money by lowering the quality of your plans.
2. Pad Your Emergency Fund
Most experts recommend having six months of living expenses socked away in your savings. But in today’s economy, it’s smart to have enough for at least eight months.
3. Start Networking
Everyone’s situation is going to be different. Some of you will want to try and find employment as soon as possible. Others will decide to start a business, or even take some time off to pursue a personal dream, like traveling or volunteer work.
Losing or leaving your job can be an incredibly nerve-wracking experience, even if you have done everything you can to prepare. But keep in mind that your experience is up to you. That is, you can look at the situation as a catastrophe, or as an open door.
What about you? Are you facing a voluntary or involuntary job loss? Have you already gone through this? Please share any tips or advice you may have!