All throughout our childhood and education, we are focused heavily on getting qualified for a good job. Once we’ve completed the appropriate training and gotten hired, the last thing we want to think about is the prospect of that hard-earned job going away. Yet the reality is that it happens to about 1% of the workforce each month.
That figure doesn’t sound like much until you put it into perspective. Specifically, you should note that it’s a monthly figure, so the annual average is around 12%. Now think of a group of 100 people you might be with–perhaps the number of people eating at a restaurant while you’re there–and imagine that 12 of them could be jobless by year’s end.
So it’s beneficial to accept the reality that a lot of people lose their jobs each year, and that it’s could be a possibility for you. Once you come to terms with that reality, you can make plans that will reduce your anxiety. After all, the most frightening part of being jobless is that you don’t know what you’ll do. You can ease that fear by figuring out what you’ll do.
There are several steps involved in making a financial plan for being without work, and it starts with the most obvious: Unemployment benefits. Understanding North Carolina unemployment eligibility, or the eligibility requirements for your state, before you actually need to draw benefits is essential. You’ll need to make sure that, during your working time, you are taking the appropriate steps to assure your eligibility should the job go away.
The next step is to have an escape plan. That doesn’t mean that you spend day and night obsessively tweaking your resume or searching for a new job (although there’s nothing wrong with keeping an eye open for more stable opportunities). It just means that you keep things current. Maintain a strong network of colleagues, former co-workers, and others who work outside your employer, and even outside your industry.
In terms of your finances, avoid and reduce debt. It’s a great feeling to get that first paycheck and go buy a new car, but a better option would be to get something cheap and reliable until you can build some stability. You’ll also want to double-down on student loan debt, credit cards, and other debt. Get stabilized before adding debt.
Look for other ways to earn extra money. It may be grass mowing, child care, house painting, or helping a friend with a business. Whatever the strategy, use the money to build an emergency fund that will carry you through a layoff.
Find ways to cut your daily expenses. Manage your heating and cooling costs. Let laundry air-dry instead of burning energy (and simultaneously adding heat to the home). Download coupon apps that can save you money without all the clipping. Buy clothes on clearance at the end of the season. Find cheap, simple, delicious recipes to cook at home, and keep restaurant meals to a minimum.
Some of the stricter strategies can be temporary. Try them for a while to think about how you’d use them if you had to (and to get an idea of how much money they can save you), then keep those plans on a mental shelf until they’re necessary.
No one likes to think about what will happen when they get a pink slip. But everyone needs to be prepared for it. The more things you do before you’re out of work, the less you’ll struggle if that happens. It is a situation that’s often unexpected, but you don’t have to be unprepared. The anxiety and potential financial damage of a layoff can be reduced by a great plan.