I was made redundant back in 2009 from my financial analyst job at a media firm in London.
The credit crisis (as it was known at the time) was hitting advertising hard, so our team was halved.
I was pretty happy about it as I was already planning to leave, and took the £9,000 or so to South America to see how long it would last until it ran out – which was seven months (and was chuffin amazing).
I was 28 years old, with no dependents, and a decent five figure amount sat in a high interest savings account (6%+, remember those days). I didn’t touch a penny of the capital, although I did spend the interest.
If you’ve never been made redundant before then it’s hard to imagine you’ll ever be taken into that room by HR and told you have a few months (tops) to get yourself another job.
This memory came back into my mind today as I read an article on the BBC website about four people who have had very different redundancy experiences so lucky for you dear readers, I’m going to provide you with a redundancy checklist in case you haven’t prepared for yours yet.
Feel free to email back to let me know if I missed anything.
GI checklist to ensure minimal redundancy pain:
1. Create other streams of income (such that losing your salaried income has less of an immediate impact).
2. Look at taking out an income protection policy (although I think they tend to cover you for serious illness, not simply being made redundant).
3. Create a cash savings pot of at least three months worth of total outgoings, so including food, petrol etc, not just your bills.
4. Be your own boss, and don’t make yourself redundant.
Practicing what I preach as I almost always do (plus having experienced a redundancy in the past)…
My ticking off of said checklist:
1. My family have seven streams of income.
2. We have one of these, but it does only cover me for serious illness/injury (and it covers all of our bills plus about 60% of our other costs per month).
3. Ours is currently around three months, but I tend to push it to nearer six when I can.
4. Check, and check.
You may be in a job you really like, and becoming a full time investor or business owner might not be your goal in life.
But regardless, you should be doing these four things.
And if you’re not, feel free to go away and work out how long it is before you’re maxing out credit cards just to get by each month, only able to pay the minimum off until you’ve landed that new job that’s surely just around the corner.
In my opinion, anyone who isn’t preparing themselves (especially if they have a family) for a redundancy is really naïve.
All the best,
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