What’s your plan if you lose your job tomorrow?

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Il Corso, South Road Properties, Cebu City, Philippines

It’s less than four weeks before Christmas and here in Cebu City, Philippines, the malls have filled with shoppers looking for presents. With the holidays come several work-related parties where the exchange of gifts is often part of the program. There are also subdivision parties, depending on where you live. And then there’s the friends or family gatherings.

All of these fabulous events and the big chunk of bonus burning a hole through your pocket may cause a tinge of overspending! That’s not so bad, right? Sure, you may end up closing 2018 and facing 2019 only a little bit poorer than before. Before you burn through your bonus though, please consider this:

What’s your plan if you lose your job tomorrow?

And I don’t mean in the remote future, I mean TOMORROW.

Here are several options:

(1) You’ve been working 16-hour work days for several years now, it’s finally time to chill–for a bit before starting to look for another master, a.k.a. a job. Haha.

A sudden job loss is traumatic and stressful as you’re blindsided and usually financially unprepared for it. Counter this by preparing a substantial emergency fund from that bonus and then some. That extra money may be used to take a little vacation or overseas trip to unwind and take stock of where you want to be moving forward, at least career-wise. How long will you give yourself to find a similar-paying job in the same industry before you start exploring other industries? Will starting a business be worth the risk in this current economy?

When you’re panicked or stressed it’s challenging to think rationally. And that desperate look during job interviews is never attractive to potential employers.

(2) Or maybe take a mini-retirement. If you have the funds for it, why not?

Some people with a substantial net worth but fall short of funding a full one may choose to take a mini-retirement for three, five or even ten years. It may be difficult to go back to a career after you’re done though as that gap in your resume may be questioned by employers.

Some people make a misguided decision to take out a loan and go back to school, maybe go to law school. Please don’t dig yourself in a deeper hole by taking on debt while being unemployed! A postgraduate degree may lead to higher pay but do it without accruing interest on a loan.

(3) Spring into action and fire up your jobstreet profile, send feelers out to friends and networks and then silently panic with each day that comes with ZERO feedback.

This is the knee-jerk reaction to losing a job. You spring into action and apply for jobs right away. Job applications may be done online now anyway so they may be done at zero transportation or paper costs. The only thing you lose is time, which you now have in abundance anyway.

(4) Start relying completely on your passive income by cutting your household overhead expenses to the bare minimum.

This means no eating out, no expensive entertainment expenses, and no travel. All of these while actively looking for a new job in the same industry with similar pay and benefits.

This is a variation of the first option or maybe even its prequel. This allows you to stretch your emergency fund for as long as it takes to find that job in your industry.

(5) Retire completely by relying on passive income and private retirement accounts until receiving your SSS*/GSIS** pension at 60/65 years old.

This is my dream option! The only time a job loss becomes ideal is when you’re ready to FIRE*** AT ANY TIME!

Which of these options are available to you should you lose your job tomorrow?

George

*Social Security System
**Government Service Insurance System
***Financial Independence Retire Early

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5 thoughts on “What’s your plan if you lose your job tomorrow?

  1. reminds me why i quit my job because i needed to focus on my business, the income was almost break-even that i need to cut down on my expenses in order to survive.

    Liked by 1 person

    1. It’s fortunate that your business income was enough to fund your new and reduced living expenses Chris Paul. There does come a point where business losses are so bad they’re inadequate to fund the bare necessities. But then I’m fairly risk averse when it comes to striking out on my own!

      Like

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