Money Management

10 Ways To Prepare For Losing Your Job

John, over at Mighty Bargain Hunter, suggested a group writing topic: Preparing For or Dealing With Job Loss.

Here are my ideas on the subject:

1. Create an emergency fund. (I am currently building up an emergency fund of 20,000 dollars in my ING Savings account.)

2. Keep important “life” documents handy (or copies thereof). Life insurance policies, wills, social security cards, birth certificates, etc. When times get tough, you may need to apply for government assistance. You will probably need one or more of these documents.

3. Maximize your non-job related income. Do you eBay? Yard sale? Barter? Learn how to make money on you own.

4. Create a budget… NOW! Learn how to live on a budget BEFORE your “have” to.

5. Understand your retirement account alternatives and options. (Find out how, and where, to move your current 403b or 401k) Do you really want to leave your money with an organization that you no longer work for?

6. NETWORK! Do not wait until you are “canned” to “look” for new employment. Start today by talking to friends, friends of friends, and friends of friends of friends.

7. Be realistic. Your job may seem perfect (Enron anyone?). Understand that you, your job, and your talents may be (are?) replaceable.

8. Read, read, read, read, read, read. The more you understand about you job, other jobs, and the economy as a whole, the better prepared you will be in the event of a job loss. Remember, education does not STOP with formal schooling.

9. Learn a new skill, a new craft, a new technique. Specialize to make yourself less disposable, and specialize to make yourself more employable.

10. Get out of debt! The fewer “fixed” monthly payments you have, the more freedom you will have when / if you lose your job.

Great idea, John. You rock!