How to Prepare for a Possible Layoff
With a downturn in the economy, it is not uncommon for many companies to begin laying people off. Generally, companies begin by laying off people who have been there the shortest time. Often this means that people in their twenties are often the hardest hit demographic when it comes to layoffs. You may want to look for warning signs, like a decreasing client base or not getting paid on time. Even when times are good you should be preparing yourself to handle a possible layoff. Here are five specific things you can do to prepare yourself for a layoff.
Time Required: A few minutes a week
- When you are faced with a layoff it can devastate you financially if you are not prepared. It is important to make a commitment to follow a budget every month and to make every effort to get out of debt. You should also carefully consider any loans that you take out, and what would happen if you were not able to pay them back. If you were to lose your job and you were already on a budget, it is much easier to see what you will need to change to keep your finances under control while you look for a new job. Take the time to write up a bare-bones budget now, so you know what to cut when you need to.You should prepare your finances for a recession, as well as your job skills.
- It is also important to have an emergency fund on hand. This emergency fund should cover three to six months of your expenses. It takes most people between three to six months to find a job. Even if you do not have the entire amount saved when you lose your job, you will be able to make your severance and any other unemployment stretch much farther because you have saved that money. It will also help to protect any money that you have saved for retirement. Your emergency fund is just one step in disaster-proofing your finances. There are many reasons to have an emergency fund, and you should start working on it today.You may want to save before you pay off your debt in this situation.
- You should continually be looking to improve your skills and certifications. If you can receive additional training or certification through your current company you should take advantage of that. You may receive the job over another candidate who has more years of experience but is lacking in the certifications or newer computer skills that your job requires. This will also help you to find a higher paying job, as well.
- Additionally, it is important to continue to network at all times. As you build relationships with those around you in your company and in other areas of the industry you will have contacts who can help you to find a new job. Most job hires come as a result of whom you know. It may be that you hear about a job through a certain person, or you can use someone as an additional reference.
- While you are at your company you should work with a positive attitude and give it your very best commitment. This may protect you from being laid off, but it can also help you to receive good references when you are looking for a new job. It is important to do your best work at all times possible and to build a good business reputation.
- Take the lessons you are learning now and apply them to the way you handle money in the future. The lessons from a slow economy can help you be more successful financially if you continue to apply them during good economic times as well. Preparing a budget and following it now will help you prepare for a time when money may be tighter in the future.
What You Need
- Emergency Fund