Microsoft is the latest firm to announce layoffs.
If you work in Big Tech, hope for the best, but prepare for the worst.
Here’s how.
1. Beef up your emergency fund.
Make sure your emergency fund is at least 6 months of living expenses. It should be sitting in a high-yield savings account ready to be transferred to your checking at a moment’s notice.
Your credit card limits don’t count. Your unsold company stock doesn’t count. Your 401k loan doesn’t count.
If you don’t have 6-12 months of living expenses, but you have other investments, then consider liquidating some of it now.
2. Budget the expenses you’ll cut
Getting laid off is an emotional event that makes it kind of hard to think straight.
So decide what you’ll do, if that call, email, or Slack comes.
What can you do to reduce your expenses?
Can you change your grocery habits?
What subscriptions can you live without?
How can you have some FREE family fun?
Make a list and then redo what your likely budget will be. It should make you sleep better at night having a plan.
3. Take out a home equity line of credit (HELOC)
A HELOC is a line of credit against the equity in your home. Right now, their charging ~6% which ain’t cheap financing, but it’s a lot cheaper than “borrowing” on your credit cards at 20%+
If you’re prepared, getting laid off doesn’t have to blow up all the hard work you’ve put into your finances over the years.
This too shall pass. Just make sure you’re still around when it does.
