Financial Moves In The Event Of A Job Loss

The economy is rolling but it might not always.   In fact, things won’t always be so great.  It’s just the cycle of economics.  I’ve been at my job for 12 years.  It’s great and I feel secure, as I’m sure do many.  Still, it never hurts to prepare in the event of a job loss.  Here are some financial considerations in the event of a job loss.  These are tailored for my family, but are applicable for many.

Unemployment Benefits / Health Care

I would expect that any state unemployment benefits that I would receive would be eaten up by health care premiums, whether it be COBRA or a privately funded insurance policy.

Paying the Bills

We have an emergency fund specifically for events like this. The money isn’t earmarked for anything else. We would use this to pay essential bills.

If unemployment were to continue for longer than that time, we would look into one of several options. First, we could sell some investments. We have non-retirement investment holdings that I could sell that would sustain us for another 6 months or longer. Second, we could re-evaluate some of our other cash holdings. We have additional dollars alongside our emergency fund that are earmarked for things like a new car, home repairs, etc.  These can be be re-allocated if necessary.

Concentrate on the Job Search

Due to having a fully funded emergency fund, I wouldn’t be panicked.  Since we could pay the bills without fear of ‘going under’, this would allow me to focus on a job search.

As of now, there are lots of contract positions available in my field.  I am not inclined to work contract for a considerable length of time.  Many are fine with this.  I’m not.  But, in the interim, to put food on the table, I’d definitely look at these positions.  It could end up leading to something permanent.  That’s how it worked for my current job!

Reducing Expenses

There are definitely some expenses I would look to cut as a method to reduce our cash outlays. Even though we have a fully funded emergency fund, the fact remains that with a job loss, it would no longer be fully funded after I found new work, and would need to be re-built. I would employ the following strategies to make sure that our cash lasts as long as possible and to ensure that we could get back on track as quickly as possible once I found new work:

  • Eliminate Netflix
  • Eliminate eating out
  • Unlevel some of our spending – I currently put aside an equal amount every month so that our monthly spending is fairly even. But, this has increased the amount of cash that is on hand. We could essentially draw down some overfunded accounts.  Of course, we’d work to replenish them later!
  • Let the lawn go brown
  • Reduce or eliminate the A/C and cut back on heat.
  • Cut back grocery spending.  We could save some money at the grocery store.  First would be working through food we have stocked up.  The pantry and freezer would be good for this.

In Summary

When faced with a job loss, finding work is the most important goal.  But, making sure you and your family have the basics is just as important.

Nobody wants to think of a potential job loss, but preparedness is key.  It does happen.  It’s happened to me and while I hope it doesn’t happen again, it’s good to know we are ready in many ways.

Readers, have you faced a job loss?  How did you deal with it?  What job loss preparations do you currently have in place?  

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

When I Once Helped Somebody To Be Frugal

It’s always nice to help someone, right?  Helping people makes you feel good, and (hopefully) them as well.  Here in the finance world, helping someone to save money is always a goal.  This is a look back when I once helped somebody to be frugal.

A Simple Conversation

Where it started was a simple walk down the hall to a meeting.  On the way, the co-worker I was walking with said something that floored me.  It was simple but humbling when he told me that I inspired him to start bringing in his lunch.

We talked and I found out that he usually went out for lunch.  Making a lunch was something that he had never bothered to do.  So, when he got hungry, he went out. Or he would go to the cafeteria.  Maybe the vending machine.  In any case, he never brought in a lunch.

Watching Me

As it turns out, he was watching me.  We sat nearby so he saw that my lunch was pretty basic.  I normally bring in:

  • Vegetable (carrot sticks)
  • Sandwich
  • Fruit
  • Yogurt

In all honestly, this takes about 5-10 minutes to put together. I do it at night so that the morning is just a grab-and-go.

He watched me and realized:

  • Packing such a lunch was easy
  • It could save him money
  • And, it was healthier!

People Are Watching

I was pretty happy that I inspired someone to make better choices.

Now, honestly, this happened a few years ago.  We no longer work in the same building, so I have no idea if he actually kept up with it or not.  After all, habits are hard to change, and his habit was NOT making lunch.  But, I’m hopeful.

Here’s the thing, though.

Even if he didn’t keep up the habit, maybe someone else did.  I can’t imagine that he’s the only person that’s ever noticed me taking a lunch.  Maybe others have noticed and never said anything, yet tried it out.  Who knows?

But, it just goes to show, you never know who’s watching you.  Hopefully if you’re being noticed, it’s for something positive!

Readers, have you inspired someone to make a better financial choice?  Have you helped someone to be frugal?  Let me know in the comments below.  Thanks for reading!

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

9 Money Goals Everyone Should Have

Rich or poor, working or retired, blue collar or white collar.  None of those things or any other will get around the simple fact that money is important.  As such, there are certain things that everybody should do with their money.  These don’t mean that everybody should approach money the same way.  It just means that in some fashion, each of the below items should be on everyone’s list of money goals.

Have A Rewarding Career

Don’t hate your job.  It’s just not worth it. You don’t have to love every minute of the day that you’re at work.  That’s just not reasonable.

But you should enjoy what you do.  You should feel that you’re making a difference.

Make Your Job About More Than Money

Money is great, but it’s not everything.  You want to have enough to pay the bills and enjoy life, but always look at the trade offs.  If you’re missing your kids grow up or losing your friends on account of your job, reconsider your priorities.

Money is a means to an end.  Treat your career accordingly.

Have A Fallback Plan For Your Income

Your job may seem like the most secure thing in the world.  It might not be tomorrow.  You might love your job more than anything.  That could change in an instant.

Always have an idea of what you could do next.

For some this could be another position or a contract job.  For others, maybe you have a side hustle that you could do full time.

Whatever the case, be prepared.

Save Money

Whether you’re just starting off and on an entry level salary or you’re rolling in it, save money.  It’s important.  Even if you’re paying off debt, save money.  It’s a cushion to fall back on that everybody needs.

Budget And Track Your Money

Do you know where your money goes? Do you know where you want it to go?  You should be able to say yes to both of these questions.

Now, you might not want to track down to the level of every dollar.  Or maybe you do.  Whatever your style is, you need to do both of these things for money success.

Understand Your Investments

If you invest on your own or through a 401(k), it’s important to know what you’re investments entail.  Even if you have an adviser, you need to know where they’re putting your money.

This won’t guarantee you will never lose money, but chances are, if you understand where your money is, you’ll end up with more of it than someone who doesn’t.

Be Well Insured

If you drive, you need auto insurance.  A homeowner? You need insurance on your property.  What if you rent?  You need insurance on your property.  If you have family that counts on your income, life insurance is key.

Understand the different types of insurance and know what you need.  Make sure it’s current.  Your needs today might be different than tomorrow.

Look over your policies and your needs at least once a year.  As part of that, bid out your insurance to see if you can find a better price.  This is one area that changes often.

Know Your Credit Like You Know Your Family

Your credit is the basis for almost anything you do with money.  You can’t get loans without good credit. You can’t pay your bills if you have too much credit.  Some employers won’t hire you if you have bad credit.

The bottom line is that you need to know your credit.  Know what you owe.   Know your score and what it means.  Keep track of such things regularly.

It’s one of the most important things you can do for your money.

Have Vision

What’s the use of money if you don’t have a plan for what to do with it?  Of course you have your needs today that must be accounted for.  But also know what it’s there for long term.  Plan.  Have a vision for what your money will be doing for you down the road.

These are some items I think are of utmost important for anybody that thinks money is important.  That’s you, right?

Readers, what do you think of this list?  What are some of your personal money goals that might not be on this list?  

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

How We Level Out Monthly Expenses

Bills you pay every month require budgeting and tracking.  However, some bills flucuate in costs or even frequency.  We’ve developed a system where I allocate and track these expenses.  It works because we use a spreadsheet.  But, it comes in handy because we never miss a bill. Nor do we come up short on paying recurring expenses.  Here’s how we level out monthly expenses.

Types of Expenses

First, it’s helpful to determine what the expenses are that we level out.  Some of the obvious ones include:

  • Utility Bills
  • Insurance Premiums
  • License Tab Renewals
  • Auto Club Membership Fees
  • Charitable Donations

Over time I’ve identified some others that we also track and save for monthly.  These include:

  • Netflix
  • Other subscriptions (e.g. Amazon Prime membership)
  • Christmas gift fund
  • Camper storage fees
  • I even allocate for my costs in playing fantasy sports!

I am usually pretty on the mark when it comes to projecting the expenses that fall into this category.  What I have to do is allocate them out to cover costs for a year, even when costs are uneven.  Let me explain.  Many of the expenses above are monthly and around the same cost, but some are not. This is because of seasonal changes (higher electric bills in the summer, higher gas bills in the winter) or billing cycles for bills that aren’t monthly (the water bill every two months, the garbage bill every three).

Paying as you go would mean that some months you’d have money left over where other months you’d come up short.  The months you come up short can be a problem for many.  So, by averaging all of the costs for each category and then budgeting accordingly, we are always fully funded.

Utility Leveling Re-Imagined

The gas and electric companies already offer this service.  Both companies will allow you to pay a flat amount based on their estimates.  If you come up short, you do owe the difference.  If you overpay, they’ll lower your estimates.  This works for many people, and it’s sort of what we’re doing.  The benefit is that we keep our money!

One thing that you may ask is how this works when we come up short.  Say we budget $1,200 annually for electric bills, but our costs are $1,350. This means we ‘owe’ that fund $150 at some point through the year.  The way I work handle this is by keeping a ‘cap’ for some of the fluctuating categories.  So, for example, I have a $500 ‘cap’ on the gas bill.  Once we have $500 allocated toward gas, I know that anything further would be over funding the account.  If that happens, I’ll simply take the extra allocation and distribute it toward funds that are under allocated or that could use a boost.

It sounds kind of complicated, but it works well.  Of course I have been doing it this way for many years, and the system works pretty well.

Readers, how do you level out monthly expenses?  Do you create ‘sub-accounts’ off your main checking or savings?  

Copyright 2017 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.