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Tough times call for tough decisions. As the economic crisis gathers and the prospects of job loss become real, it's a time to be prepared for the worst, says Shalini Amarnani. Losing your job can be one of the most devastating experiences in life. It erodes self-esteem and eats into financial security. However, there is no getting away from the fact that we are in midst of a financial crisis where thousands of people are losing jobs every day. Being alert of the possibility
While you may have not been laid off, it is not a time to be complacent. Some industries are more vulnerable to job losses than others. These include banking, IT, ITES and other companies that depend on international clients. The signs of vulnerability are usually clearly visible. They will include lack of bonuses and promotions, freebies disappearing, travel being reduced or frozen, etc. The best time to prepare for the reality of unemployment is before the event occurs. E. Balaji, director Ma Foi Consultants, advises, ''Being prepared is half the battle won. Take a hard look at your resume and spot the skills that are most marketable in the current market scenario. Brush up all your contacts and start sending out feelers for a new job.''
Be prudent
Others might say, stick to your job if it is
relatively secure. Hopping a new organisation may be
the last thing you want to do in an uncertain world.
If the new organisation gets into trouble, you may be
the first to be asked to leave. So, be prudent.
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Financial action plan
- Cut
back on credit card spending. In fact, lock
up the credit cards for some time.
- Ensure
that you don't cut down on essentials like health
and life insurance.
- Create
a new budget. Forget about all the luxuries
that had graduated to become necessities. Re-look
at each expenses long and hard.
- While
emergency funds of about three months are the
norm in most other situations, in the current
financial crisis, an emergency fund of up to
six months is needed.
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It is also a time to tighten your belt financially and
put your credit card away. Kartik Varma, I-Trust, financial
consultants, asserts, ''This is a time to practise what
our parents have been preaching to us – frugality. Identify
what are 'must have' (expenses such as kids' school fees,
utilities, etc.) versus expenses that are lifestyle-related,
which you could forgo (like seeing movies every weekend,
eating out, etc.).
He adds, ''Also important is to repay all expensive personal loans rather than continue with them. If you have an emergency fund, use this to pay off your outstanding debt.'' When you are laid off
If you are one of the unfortunate ones who have been given the pink slip, it is essential to keep a cool head and make most of the situation. Most employers offer some benefits, which could include two or three months' salary or equivalent. Also, the intangible benefits that you can take away are invaluable. Ensure that you get good recommendations from your bosses. Do keep in touch with them and keep them informed about your progress. Also inform your clients about the move and the reasons for it. Keep up the contacts in the future. Goodwill created during a crisis can last you a lifetime. After the layoff
The layoff may have put you in a state of limbo, but it is a time for proactive action. Just as the world markets have shuddered now, they will recover in the future. Meanwhile this is the best time for some soul search and revaluating options. Shalu Wasu, trainer and consultant, says, ''Here is the chance to revive some abandoned dreams you may have put on the backburner. Identify opportunities, speak to supportive people and most importantly – do not be ashamed of discussing the situation with friends and family. It's not your fault. These things happen.'' Re-equipping yourself with essential skills will upgrade you in the job market. Explains Balaji, ''If you are a software engineer, this is the perfect time to get some management skills. Typically B-school admissions soar at times like this. There are some good options for online and part time courses too, which give you a competitive edge.'' Moving ahead
Tough times call for tough decisions. Include your family in the decision making process. All your financial decisions will affect them too. To avoid misunderstanding and garner support, you need to explain and take suggestions from your family. While jobs in some sectors have thinned out, opportunities in pharmaceutical, healthcare, insurance and life sciences are on the rise. Looking beyond your comfort zone might be the answer to your woes.
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