This is the time of year that we celebrate the mysterious and spooky. But that’s different than what is truly scary.
What would happen if you got in an accident and were in the hospital for six months? Boy, I don’t even want to think about that one – my business growth would come to a screeching halt, I’d lose all my clients, I’d have to stop doing all the things I enjoy…..
Scary, down to my core.
But we’re adults here, so we should find a way to deal with this. The first technique is to look at things in general probabilities. Your lifespan will probably be similar to your parents’. It’s not a guarantee, of course, but it at least gives you something to use as a rule of thumb. Your insurance folks can give you some helpful statistics about how long you’re likely to live.
Likewise, insurance agents can tell you the general likelihood of getting sick, of getting in an auto accident, of having your house broken into. That’s what insurance is for, so they’re very good at the numbers. If they weren’t, they wouldn’t be able to stay in business.
When it comes to smaller decisions, there’s other useful ways to think through it. What will you do if you lose your job? That’s deeply scary to many people these days.
Paradoxically, one of the easiest ways through this scenario is just to assume the worst. You WILL lose your job, probably sooner than you’d like. Maybe even next week.
OK, breathe. Remember, this is a mental exercise.
If you were to lose your job, and you had your wits about you, what would you do? You would:
- Conserve as much money as possible.
- If you need to and are able, switch some non-liquid assets into more available cash.
- Update your résumé and career plan.
- Start your job search, but with a plan in mind – not just doing random things.
If you think about it, each of these steps is possible even before you lose your job. You can be more frugal with your spending, just because the job environment is so lousy right now. You can pull some cash out of investments, if you’re able, but at a time where you might be able to get a better return than if you did it in an emergency.
You can update your plans now – a useful thing, because you have time to think through it more carefully. You can even use this to help guide your decisions around promotion and job change within your current employer.
You can look around at available jobs, if only to get a realistic view of what you’re worth and whether you might want to proactively move into a different position. You can keep up to date on which job search strategies are working in the current economy.
As a result, when the scary event occurs, you won’t be so traumatized.
Before I lost my job in 2009, I had been offered early retirement twice. Even though I declined each, the mental exercise was quite useful. I was forced to think through the financial and career implications, and create alternatives.
When the axe finally fell, I was in a relatively good position. Yes, it took some days to recover and a couple of months to get focused again. But had I not prepared, this could have taken much longer. I have friends who were laid off at the same time, who still haven’t recovered from the trauma.
So if you want to survive the scary moments, think through them now. While you have some time to do it carefully, before it’s an emergency.
by Carl Dierschow