In today’s economy, no job is 100% certain. You never know when your company will be forced to downsize due to recession or industry decline. While everyone hopes for high job security, it is always best to be prepared for a possible layoff. Here are some ways to reduce the impact of a job loss.
Fall Back on Your Emergency Funds
Most financial experts agree that you should have a financial reserve equal to 3 to 6 months of your living expenses. These emergency funds will provide a valuable cushion while you search for another job. If you don’t have an emergency fund, start saving now. First, take a close look at your expenditures and set a target amount. Next, find ways to cut back on your expenses. Additionally, whenever you get a bonus or raise, stick the extra income directly into your savings. It takes willpower, but try to avoid making extra purchases until you have hit your goal.
Reduce Your Expenses
The first step when facing a job loss is to reduce your expenses. Look at where you spend your money and find as many ways to cut back as possible. Does it make sense to move to a cheaper apartment? Can you stop eating out? Will you survive without cable TV? Should you trade out your car for an older model? Are you struggling to make your mortgage payments? Mortgage forbearance can reduce or suspend your mortgage payments. Be creative and cut back in every way possible. You might even qualify for governmental assistance for food and other expenses.
Improve Your Employability
You will have a much easier time finding another job if you have taken the time to improve your employability. There are many ways to do this. You can stay current in your trade. You can develop new skills. You can advance your educational level. You can improve your soft skills such as teamwork and time management. You can work on your interpersonal skills. You can finetune your CV. You can spend your time volunteering. You can take an online course. This unforeseen extra time on your hands could ultimately be used to expand your skills and get an even better job.
Losing your job doesn’t have to be the end of the world. In fact, it can be an opportunity if you act wisely rather than simply react. You can even boost your future income by using this time to improve your employability. In the meantime, fall back on your emergency funds and reduce your expenses. You should be back on your feet in no time.
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