Filed under: Personal Finance, Lynnette Khalfani-Cox
When considering a "what if" scenario, evaluate what could go wrong in your life. Could your health decline? Could your investments go south? Could you go through a divorce? Running a few "what if" scenarios in your head (or on paper) isn't meant to turn you into a Negative Nellie. Instead, it's simply a way for you to better plan for unexpected events that can happen to anyone.
Amid periods of high unemployment, the most pressing "what if" scenario you should think about is: "What if I lose my job or suffer a big reduction in income?" The loss of income can be emotionally and financially trying for anyone. I know, I've been through a downsizing -- and it wasn't particularly pleasant. So even if you think your job is relatively secure, it wouldn't hurt to take some precautionary measures that will shore up your personal finances and reduce your stress in the event of an unforeseen layoff.
Here are some steps you can take amid periods of high employment:
1. reate and stick to a budget:
Try an free online software program like Mint.com to help you get started.
2. Increase your savings:
Check out AmericaSaves.org for savings tips if you're constantly struggling to stash more cash.
3. Pay off excessive or high-rate debt:
For ideas on becoming debt free, see my book Zero Debt: The Ultimate Guide to Financial Freedom.
4. Eliminate frivolous spending:
Now is not the time to live the "bling bling" lifestyle. Conspicuous consumption is so 1990s.
5. Manage your credit wisely:
More and more employers are increasingly using credit checks to determine whom to hire and promote. So learning how to achieve perfect credit is a worthwhile goal.
Even though we're living in tough economic times, there is no need to fret excessively over the prospect of a layoff. Still, any or all of these steps will be helpful in the event an employer ever gives you a pink slip.
Are you going through a bout of unemployment or worried about your job? Sound off on this topic below.
Lynnette Khalfani-Cox, an award-winning financial news journalist and former Wall Street Journal reporter for CNBC, has been featured in the Washington Post, USA Today, and the New York Times, as well as magazines ranging from Essence and Redbook to Black Enterprise and Smart Money. Check out her New York Times best seller 'Zero Debt: The Ultimate Guide to Financial Freedom.'