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Please prepare for lay-off.

18 Apr

A few days back, I was reading all the new posts by some of my fellow bloggers and came accross a post that hit home. It was written by Digging Up and Out and I encourage you to read it here. It talks about how she was laid off one year ago today and where she is now.

It gave me great comfort to read her story and relate it to my own. I was also laid off my job of almost 10 years, 2 months ago. I worked as a chemical technician for 13 years total. I was fortunate in the fact that I always looked at this job as temporary. I remember the day after I started, I was sitting in the lunch room with my new coworkers, and one of them asking me if the company had been honest with me in the interview and told me that a temporary lay off may happen at any time. Of course i nodded my head yes, meanwhile my mind was doing circles. No, they had not told me that, or if they had, i never heard it quite like that. What was I getting into? From that moment on, I treated that job like it could be gone at any second. It factored into every decision I made in the last 9 years and that we made as a family.

When we bought our new house, we put as much down as we could and only took out exactly what we needed, no extras for the basement or yard or garage. For those things to be built, they would need to wait till they could be paid for outright. My point for this was that I needed to keep those mortgage payments low enough that if i was to lose this job, we could still make payments, as well as cover all other expenses, on my husbands salary alone.

The real preparation began 13 months before my actual layoff date. That was when the company lost a major contract and without saying it outloud, we all knew that unless that could be replaced, they would have no other option but to shutdown half of production and therefore lose half the staff.

I thought I would share with you some of the steps I took to prepare our family for this change. One thing I always did from the beginning of my very first job, was to have the deductions taken right off my paycheck. It started with Canada Savings Bonds and then eventually switched to TFSA when they came on the market. I started with just $50 a cheque. All increases in pay were immediately adjusted into the savings account so that my take home pay never increased in the 9 years. Once I went on maternity leave and we were forced to live on less, I knew we could, so that is what we did. Contributions were increased again when I got back to work, though not as much as would have liked in those first 5 years due to high daycare costs.
I returned to work from my third maternity leave 3 months before we were told of the lay offs. However, I increased my savings contributions so that my take home pay was equivalent to maternity leave pay. Once we were officially told of the layoff, we were given roughly 6 months notice, so I once again increased those payments leaving my take homepay equivalent to what I figured I could earn working for minimum wage. I did this for 2 reasons:
1) To increase the amount I had in savings, obviously.
2) To give us a good 6 months to prepare and make necessary cutbacks and adjustments while still providing us a cushion to learn with.
I also left with a severance cheque worth roughly 5 months of full pay, so that worked out to about 10 months of our newly adjusted pay.

I am very proud of myself for all these things I did to prepare. This event has forever changed the way I will deal with my paychecks. Never again will I look at my paycheck as a whole number for me to take home. There will be payments to myself taken off first and what is left over, I will be free to do as I wish with, once investments, savings and emergency funds are all paid FIRST.

Had I not felt like this job was always in jeopardy, its hard to say if I would have been aggressive like this. I did do payroll deductions at my very first job, when I wasn’t at risk, so I like to think I would have. I talk to my friends, and anyone who is interested, about the importance of saving and paying yourself first as much as I can. Living on less than what you make is the single most important life lesson I believe people need to learn. Im not suggesting you don’t enjoy your life or live by scrimpy by, but we all need to realize that things and life can change in an instant and we need to be able to handle that. It may not be a layoff, but it could be an divorce, illness, injury, or even death. Nothing is guaranteed in this life. Only we can determine how much damage the unexpected changes will cause.

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