Concerned about losing your job? Here are the top five ways to prepare for it

Preparing for possible unemployment is very important and can be done by saving six months of living expenses, extending insurance for two years, continuing education and skills, actively networking and staying active within the organization

Shailesh Khanduri
14 Mar 2023
Concerned about losing your job? Here are the top five ways to prepare for it

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New Delhi: Historically recessions occur when inflation is high and the Fed raises interest rates to combat inflation. Recession is being discussed by every TV reporter and many CEOs. Posts about layoffs are piling up on social media. TV channels are abuzz with news and interviews of personal finance experts discussing the possibility of an imminent recession. There is also the possibility of unemployment, and the atmosphere of the city is dark.

It's scary to think your name could be next on the list. Back in 2014-2015, when NBFCs and banks were laying off employees en masse, everyone hoped that they wouldn't get the dreaded phone call or email of being laid off from the job. Those times have passed leaving behind valuable lessons for all of us to learn.

Across all industries, the prospect of unemployment has become commonplace. Almost everyone initially assumed that only new-age startup firms that ran out of money were laying off employees. The sudden dismissal of long-term employees at well-known companies such as Google and Meta has upset many families. No job is guaranteed, so it's better to prepare for the worst than to be surprised when a pink slip comes along.

Here are five steps you can prepare for unemployment.

Maintain a fund worth six months of living expenses

Losing a job can be a big relief if you have enough money to cover your household expenses for three to six months. It gives you time to assess the situation, weigh your options, and plan your next steps. It takes a little less family pressure as well. If you don't have enough money in your bank account, you can turn your long-term deposits, bonds, stocks, or real estate into easily redeemable assets like savings account money or cash.

Renew your insurance plans for at least two years

If you lose your job, you will have to cut back on your expenses and live on basic necessities until you find another job that pays as well. Insurance premiums are one of the most common expenses most cash-strapped people cut. Poor insurance can put your finances in jeopardy if your health deteriorates at the same time. Remember Murphy's Law? Renew all policies for an additional two years. Hopefully, you'll have enough leeway to weather career setbacks and health setbacks if they happen at the same time.

Focus on updating your skills and your resume

It may be a good time to update your resume. Improve your resume by simply signing up for a skill-up course, even if you haven't completed it. Less vulnerable to axes if you have the relevant skill. Skills that are useful in other roles may also be useful. Something that is not immediately superfluous. Keeping up with industry and business changes helps you make the best decisions.

Rebuild your social network

You are like the people you know. It's time to hone your networking skills, attend networking events, and actively network with your peers. Connect and build relationships with friends, former colleagues, seniors, industry influencers and more on LinkedIn. Don't think of it as a deal solely for the purpose of finding another job in case you lose your current one. Consider this a long-term investment in building deeper and more meaningful relationships.

Contribute more to your employer's organization

Move with your organization's top performers. Volunteer work and participation in all projects. Stay positive. This helps protect you from being identified. Even if you have to hand in pink slips, you'll still have good references from your co-workers and bosses. A positive attitude and supportive environment can help you cope with the disappointment of losing your job.

You are paid by your organization or your employer for your skills and abilities and the value you bring to the table. This also means that you are more likely to be fired along with your peers if your employer is unable to extract maximum benefit out of you.

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