Asked 2w ago
I'm working part-time over weekends still. How should I approach this situation? What should I do if I lose my job?
Earn more, spend less, review finances
Make sure full time job is stable
Get a part time job
Do side hustles
Find out what are the non-essentials and spend less
Review all your debts
Do balance sheet, cashflow and income statment of yourself
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1) don't panic.
2) Check your expenses (average 3 months at minimum, if you can do full year that would be great). Note which are the fixed non-negotiable items (housing loan payment, hp bills, power / water, s&cc, tax, insurance) and average your other variable expenses (eg eating, recreation, travel, shopping). Work out how much you would need monthly.
3) look at your bank balance and divide by the monthly amount in (2).
>> If you have less than 3 month coverage, you will need to find the variable expenses to trim or scale back without affecting your overall life (some examples include cable TV, netflix, movies, travel). This will make the cash last as long as possible. Your priority and focus will switch to making this buffer as fat as possible to tahan 6 mths, while you work and control spending.
>> if you have 6 mths or more, you are in a better position, you could just control the spending and put more focus on finding a better long term job.
Don't quit your job, hang onto as long as possible. If you lose your job, ask for retrenchment benefits. Work through the math and budget. Knowing your numbers will give you more confidence and helps you keep calm.
If you have more than enough time to do all the above, you can also try this - I do two budgets, one assuming (a) everything is normal, no loss of income, and (b) I will lose my job and the next one has a 30% pay cut. I plan out what are the things I will already cut to balance budget (b). Doing these two budgets have made me overall a calmer person.
Firstly, we need to have a complete understanding on our cashflow. Through this process, we will understand our earning ability and spending habit.
Here is a Guide:
In essence, there is one thing that you should do: Increase your net cash flow.
You can achieve this by increasing your income, e.g. part-time work on weekends.
Alternatively, you may also choose to take some time to understand your expenses and evaluate how to reduce it. This is especially for fixed expenses. (explanation in the post above)
Moreover, you may also use this opportunity to upgrade yourself so that you remain relevant to the employment market.
All in all, create a budget that is capable of helping you to save up as much money as you can during this period. The best way to do this is via automation.
How I do My Budget:
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