#layoffsinit

Thousands of job cuts have been announced in the first one-and-half months of 2023. The layoff wave has impacted not only startups but also big tech companies such as Amazon, Microsoft, Google, and Twitter. As many as 380 tech companies have axed 1,08,246 employees across the world this year, according to Layoffs.fyi, a tracking website.Being laid off can be devastating. But don't panic. You need to sketch a plan for how to pay your bills, and EMIs and manage your finances till you get a new job. Here are some useful tips to manage your money after a job loss.1) Cut your expenses If you just got a pink slip, your monthly cash inflow will be reduced significantly. So, the first thing you need to do is slash your miscellaneous expenses. Stop ordering food frequently, cut down on going out every weekend and eating outside, and cancel the gym membership or OTT subscription that you hardly use, said experts. Eliminating all discretionary expenses in one go can be difficult, so try to reduce them to the bare minimum. For instance, plan a family movie night at home instead of a luxury meal outside. 2) Prepare a monthly balance sheet Make sure that you prioritise your fixed expenses such as insurance premiums, loan EMIs, credit card repayments, and monthly instalments for mutual fund SIPs. First, take stock of the savings you have. Then, you need to calculate your monthly financial commitments and liabilities. "Check and budget your savings in such a way as to have at least six months of survival money. After being fired, in all probability, it will take time to get hired," said Ankit Mehra, CEO and Co-founder of GyanDhan, an NBFC. If you don't have enough savings, then you need to prioritise your investments. Stop your monthly SIP if the finances are too constrained. For home or vehicle loans, you can request the bank to reduce the EMI amount by increasing the loan tenure. You can also inform your insurance company about your situation. Check whether they can alter the periodicity of payment of the premium or reduce the cover amount temporarily, suggested experts.3) Review your investment portfolio with a long-term perspective You need to cut down on your expenses. However, do not dig into your retirement corpus or long-term investment goals. "Look at how much you spend each month and see where you can save. Review your investment portfolio to ensure that it aligns with your current financial goals and risk tolerance. Make changes to your investment portfolio gradually and with a long-term perspective in mind and not make any drastic changes based on short-term market events or emotions," said Kartik Narayan, Chief Executive Officer - Staffing, TeamLease Services. 4) Money crunch? Go for loan against your investments, borrow from friends and family If you don't have an emergency corpus, use your bank savings to go through this period. If it is insufficient, you can start withdrawing from your existing investments. The interest on a loan against assets such as fixed deposit, PPF, insurance, gold, or property is usually cheaper than personal loans. For example, the loan from the PPF account has an interest rate that is 1 per cent higher than the current effective interest rate. So, if you request a loan against your PPF, the interest rate could be 8.1 per cent. Do note that other terms and conditions will be applicable to be eligible for a loan against PPF. At present, the interest rate on personal loans in any public or private sector bank usually starts from 10.5 per cent, depending on your income and assets. If you have invested in a mutual fund, you can also consider redeeming your investments. So, choose wisely in case you need some urgent cash flow."Ensure you don’t borrow money at high-interest rates thus getting into a debt trap," Sudhakar Raja, Founder, and CEO of TRST Score, a human risk mitigation platform.You can also reach out to friends and family to borrow some money to survive this period. You can always repay it later when you get a job again.5) Take care of your mental health "Layoffs are brutal. They bring with them a range of negative emotions that will derail you. Take one day at a time. If you are feeling overwhelmed, get in touch with your friends, family, or even a therapist (free resources are available)," said Mehra. Don't be discouraged by job loss Finally, do remember that being laid off is not necessarily a reflection of your performance. "Don't be discouraged by the job loss. Know that this is just one of the phases of an economic cycle. Apply for jobs in the sectors that are currently performing well. Hone your skills for higher job security," said Sumit Sabharwal, CEO, TeamLease HR Tech. Source link Read the full article