Federal workers, manufacturing employees, even corporate business staff may be experiencing anxiety around the possibility of job cuts.

Focusing on the factors you can control is the first step. So, what can you do?

1) Review your budget, if you don’t have one, rough one out.

2) Look at your expenses and separate them into Needs and Wants. Needs are items you cannot  do without, and Wants are items you can choose to not purchase, or can wait to purchase.

3) Does your job cut or layoff come with severance pay?

4) Review your prospects to replace part or all your income should you be furloughed or fired.

5) Review your emergency reserves ? Do you have 3, 6 or 9 months of savings to support you     while you seek new employment?

After gathering this information, you have the basics to start making decisions.  Some of you may need to shut down every expense possible to make sure you can cover the Needs (items that are necessities).  If you have alternative income or an ample savings cushion, you many have more flexibility and can build a phased plan of action.

A phased plan may entail a variety of strategies. 

• First, you may use severance pay or some of your emergency reserves for a brief period, believing       you can find another job quickly. 
• If your job search is slower than anticipated, you can immediately initiate additional cost-cutting measures. 

Job instability is stressful.  Some find it liberating to stay ahead of the process and cut costs early to give themselves greater peace of mind.  When cost cutting, there are many areas to consider.

• Can you put off buying that new car?
• Can a vacation be delayed or cancelled?
• Review all of your memberships and subscriptions.
• Can you go out to eat less often?

While reviewing your personal expenses, look at everything with a keen eye to determine what is a priority.  Your Needs and Wants will be unique to you and your family. 

Threats of downsizing or cuts can be an opportunity to create an emergency plan to reduce stress and anxiety.  This plan will help you meet your financial needs and generally give you the confidence to know that you will survive and succeed through this turmoil.

Your financial advisor can be an integral part of creating your plan.  Don’t hesitate to reach out and get their help, even if only as a sounding board.

All the best to each of you.

Oxford Planning Group was founded by advisor Shaun Eddy, CFP®, MSFA, AIF®, who brings over 25 years of experience to our financial planning firm. Learn more about the firm here.