Expert Q&A Archive
Advice for someone who may be facing a layoff
Do you have any Advice for someone who may be facing a layoff?
Julie Ann Johnson:
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Get your 401(k) or pension money moved quickly to a private account!
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Ask your HR department for any and all information on benefit continuation, severance policies, outplacement services, letters of reference, etc. that the company may be offering. Research the COBRA benefits that should be provided by your company and assess your ability to maintain medical and dental coverage. Take it upon yourself to obtain letters of reference from supervisors. Ask for their contact information should prospective employers want a reference from them. Begin now to draft a resume and search on-line job sources such as Monster.com to assess job availability and the marketability of your skills. Contact a local workforce investment board (your local Chamber of Commerce can refer you to one – and perhaps other resources as well). There you will find assistance with skills assessment, resume writing, interviewing strategies, and access to job openings that have been posted with them. Don’t get nervous – get organized!
Gary Silverman, CFP®:
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I'll share with you an article on preparing for the recession I recently wrote for our local paper.
I’ll leave it to the economists to determine whether or not we are in a recession. What I do know is that if we are not already in one, we are definitely sliding in that direction. Because of this, I want to prepare you for its onslaught.
A recession is an economic slowdown. Slowdowns mean that people don’t buy as much. Fewer buyers make companies cut back on production. Less production means that there are fewer hours that need to be worked. At best this results in a loss of overtime. At worst, it results in a loss of your job.
Your reaction to the possibility of a recession is to Protect, Preserve, and Plan
There is a joke where two hikers come upon a bear who is threatening to charge them. One of them takes off his backpack and puts on his running shoes. “You’ll never be able to outrun the bear,” the other says. “I don’t have to outrun the bear,” was the reply. “I only have to outrun you.”
When things are going well, sloppiness can seep in. Employers may have to scrape the bottom of the barrel to fill all the slots they have. When things start getting tough, employers can get rid of the scrapings. In rough times, merely marginal employees get let go. Truly bad times see good, but less productive workers being discharged.
If you are an employee, you need to be seen as valuable at work. At least you need to seem more valuable than the other folks around you.
Spend less before trouble arrives. Cut down your debt. Build up your cash reserves.
How can you do both at the same time? Start each purchase decision by asking if you need the item or just want it. When times are good it is easier to be sloppy with your budget. When things get tough you need to ask tough questions.
Do you need a cell phone? Most people would say that it is a matter of safety. But is safety the reason it has a camera, high speed web access, and 800 minutes a month? Do you need a television? Most people would say that it is the way they stay informed. But does that information have to come on a 42-inch plasma HD set with cable and a movie channel?
Once you identify your needs, then start cutting out the wants until your debt is gone and your cash flow can sustain a cut in income.
If your overtime was cut, what would you do? If your hours were cut, what would you do? If your job was cut, what would you do?
These are questions you need to ask now and plan for. These are questions you need to continue to ask even when things look up.
Planning is how you start to prepare for what might come. Learn where the bears are. And just in case, wear your running shoes.
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If you are facing a layoff I recommend you evaluate your skills to see if you are marketable. If you are in an industry that is contracting you may want to get some additional training or certifications. If you decide to make a career change find something you love.