Contemplating a Sudden Layoff?

In a Senate hearing held late in 2008, a former high-level government official referred to this financial crisis as an "economic tsunami." He further stated that he expects unemployment numbers to continue to rise. This "news" was, in fact, not really news to anyone. Anyone that has casually followed the headlines of the previous six months was not surprised by the tidings. If you have concerns that you may be laid off at some time in the future, there are certain steps you can take now to help alleviate the pressure and stress should it actually occur. For instance:

• Put away enough money to cover expenses for the next 18 months.
• Pay down your credit cards and other debts.
• Re-visit your household budget and make any necessary adjustments to help you save more money.
• Continue or, if possible, increase your contributions to your 401(k) plan.
• If you own your home free and clear, you might look into getting a home equity loan - but only after long and very careful consideration. Keep in mind, however, that home values may have decreased by as much as 20 percent in your area.
• Order copies of your credit report from each of the major agencies and check them thoroughly.
• Check your life-, health- and automobile insurance to ensure that you have the appropriate levels of coverage. Make certain that all of your policies are up to date.
• Contact your credit card issuers and request a reduction in interest rates.
• Call your cable and/or telephone providers and inquire about possible price reductions for your cable, telephone and internet usage.
• If you have both a landline and a cell phone, consider dropping the landline.
• Research online coupon sites and bookmark them for later use. There are coupon sites available that offer discounts for groceries, household items and countless other goods and services. Furthermore, shop for and buy groceries in bulk.
• If you have a number of magazine subscriptions, don't renew them or subscribe to new publications.
• If you must buy new clothes, choose those that do not require dry cleaning.
• Winterize your home. Make sure that insulation is sufficient and weatherstripping is in good condition.
• Conserve energy by lowering the thermostat and unplugging appliances when not in use. Shut down your computer instead of allowing it be to idle in "sleep" mode. Purchase energy-efficient light bulbs and ceiling fans that utilize less wattage. Clean air conditioner filters frequently, and keep blinds open during daylight hours to help heat your home instead of raising the thermostat setting.
• Select one day to shop and complete all errands, thus saving on gas.
• Use public transportation whenever possible.
• Refrain from buying coffee, snacks, lunch, lottery tickets and other non-essential items that you have developed a habit of purchasing on a daily basis.

Begin saving money by not spending it in a wasteful or impulsive manner. We'll all have to make difficult choices and sacrifices during this recession. Now is the time to prepare.