The worries of a job loss are deep-rooted. Not having any income to support self and family is one aspect. The other being a social impact. How do I tell my spouse, my child, my parents that I have lost my job? What will my neighbours/friends i.e. my social circle think of me? I live in a city where a certain lifestyle has to be maintained, do I need to move out? Stress and puzzling thoughts can affect your mental health – you start feeling anxious, angry and dejected. You stop focusing on your physical health leading to emotional and physical fatigue. Not being able to manage emotions and finances effectively could further hamper your relationships.

Emotionally you could be unhappy, unstable and unsure. But thoughts of how to continue paying the rent/EMI, paying for kids’ education and supporting the family financially could occupy a larger mind-space. A Certified Financial Transitionist (CeFT) is trained in helping individuals and families manage this financial stress. Here are 3 simple but powerful tips which will help you if you are in this situation or foresee this situation:

1) Understanding what has changed

This is a small exercise required to be done. List down all the heads like income, expenses, debts, savings, health care, etc. that are running in your mind on a sheet of paper. State your thoughts and feelings as confident, uncertain, or fearful against each head. The worries against which you have put fearful are the ones which need your immediate attention. ‘What has Changed?’ is an evaluation tool best used as a guide for discussion points between you and your Financial Transitionist. It’s designed to provide clarity and give you a broad look at your financial picture. This is an opportunity to see where you are now, and identify any areas of immediate or longer-term concern.

2) Understanding what is in your control

Once you have indicated your feelings as explained above, filter the items you have identified as fearful. Against each of the filtered items start ticking the items that are in your control and mark a cross on those that are not in your control. For example, you might be feeling fearful about the economy but it is not in your control so you need to put a cross there. If you are fearful about your expenses then it is in your control and you need to add a tick there. This second layer of filtering will help you focus on things which are worrying you and are in your control. You can then proceed to the next step i.e. the action plan. The things which are not in your control, well, don’t waste your energy worrying about something you cannot change.

3) Understanding the action plan

The above 2 steps, would give you a direction. If it is savings then cashflow and budgeting becomes crucial. If it is emergency corpus then income generation becomes crucial. If it is selfcare then personal wellbeing is crucial. It is not likely that all the items worrying you would fall under that fearful category that are in your control. Hence stay true to yourself while doing this exercise else it would not add value. Create 2-3 action items from this exercise, revisiting the same from time to time. This will help you stay focused, resilient and move away from physical/mental fatigue.

There are 3 more actions that should be a part of your to-do list and they are:

1) Maintaining an Emergency corpus – Keep 4-6 months of your expenses available in liquid (i.e. either in your savings bank a/c or liquid mutual funds). This will always help you in managing your expenses in case of any unforeseen situations like income loss, sudden unplanned expenses or even for sudden health care expenses. Always remember to replenish the corpus if utilised along with maintaining it in liquid assets.

2) Holding personal health and life covers – Almost all corporates provide corporate health covers to employees and their families. A working couple always feel that they are adequately covered as they are under the corporate plan of 2 companies. Some corporates also provide life covers as a multiple of the salary. Do not get complacent or stingy when it comes to buying personal life and health insurance covers for yourself and your family. Please have a personal cover running parallel to the corporate covers at all points in time. What if both, you and your spouse lost your jobs at the same time and during a pandemic?

3) Managing your Debt well – Your total EMI outflow should not be more than 30%-40% of your in hand monthly income i.e. the money that comes in your bank a/c monthly. If the EMI outflow is higher than 40% then cashflow management would become very difficult and add on to your financial stress soon.

Use the power of your dreams to hold you together and guide you to a brighter future, where this dream becomes a reality. If you are going through a job loss, please let me know if this article could add value. If you have been through a job loss in the past do share how you chose to deal with it. Stay strong, this too shall pass.