This post written by Seth Busetti.
The last few years has been particularly tough for a lot of people I know in the energy sector, such as those working oil and gas exploration and production like me, but also for those in offshore equipment contracting business, or parts and equipment sales, or technical consulting. My company has gone through multiple rounds of layoffs, plus several asset dispositions resulting in more job losses. Tough times for sure. Thankfully, I have survived so far, but Alexis and I are very aware that we could be in the same position as thousands of others, including many of our close friends. If I got let go, could our family finances survive? I think so, but not by accident; we’ve been very intentional to plan for the worst. Could yours? Here are three steps that every worker should take to prepare for being laid off.
- Keep your resume, CV, and contact list updated. A resume should be about 1 page. It should capture a brief summary about the kind of work you do, and what your tangible skill sets are. This is not the place to wax philosophical. You should list your college education, if you did a thesis that is relevant to your desired job, you can list the title(s). Briefly list your work experience. Who. What. When. Where. That’s basically a page. For some careers, a CV is appropriate. A CV can be a bit longer and include publications, awards, professional recognitions, scholarships, patents, philanthropic activities, more detailed summaries of key work experiences, etc. A contact list is important too. The day you get laid off, you may not have opportunity to copy work email addresses or gather up your business card collection. These are professional people in your industry that you may want to call about new opportunities, or ask to use as a recommendation, or even just call try brainstorm your next steps.
- Get ahead of living paycheck-to-paycheck. We like to maintain a 3 to 6 month emergency fund. That’s money in a checking or savings account that we don’t touch except for major emergencies. Getting laid off counts as an emergency. Dave Ramsey says to at least start with a $1,000 fund. We like that – it’ll at least ensure that you can eat and keep the lights on. The emotional stress of losing a job doesn’t need to be mixed with fear of how to cover basic utilities until you find a new source of income. People with robust emergency funds won’t panic and make rash “gotta get cash now” decisions, they won’t need to borrow from family or take out 401k or mortgage loans, and they definitely won’t feel compelled to max out their credit cards just to make it through the month. Especially if you think your job could be in danger, tighten your belt and get that emergency fund in place, just in case.
- Keep your family expenses up to date. If you get laid off you’ll likely have an immediate cash flow crisis to address. Know what items are needs and which are luxuries. We like to sort our budget so we have rows/columns that are foundational (mortgage, electricity, groceries, and so forth), and may be difficult to shrink down if in a pinch. Don’t forget about health insurance, dental and eye care, and life insurance, especially if they were part of a plan through your company. Our other stuff (cable TV, entertainment, gym membership, college savings, etc.) is grouped separately. We don’t want to blow our emergency fund or severance on non-essentials. Keep track of your current living budget, and also a bare-bones budget that you could shrink down to in the event of a layoff. Can you calculate right now how much it would cost you to go 6 weeks or 6 months without work?
If any of these steps feel new or uncomfortable, give us a call, we can help. Losing a job is no fun, but rather than being tossed about in the storm, we want to be in a position to let the storm pass and still come out ahead. Who knows? Maybe it is God’s way to get you into a better job, maybe with a healthier or more stable company, or on a long term path that is better for your family.