Whether you’re unemployed due to being let go with cause (i.e. Fired) or laid-off (let go due to no fault of your own), being unemployed is a horrible and helpless feeling that will likely impact you at some point in your career. Which is why you’re likely reading this article! Truthfully, no matter what anyone says there is never a good time to be unemployed! Unemployment is a humbling experience particularly in the latter part of your extended career with a fairly robust but manageable set of expenses relative to the income you were making. Although your spouse may be making an equivalent, lessor or greater income then you, your family is likely depending on you to replace your income to ensure everyone can maintain their current lifestyle inclusive of healthcare benefits!
Today’s Global economy has propelled everyone’s wealth across the globe higher, as well as, lower. With the Global Economy a greater sense of world peace continues to prevail vice times of war which is awesome for everyone! Keeping our troops home as much as possible is an awesome thing! However, interconnected economies and diligent corporate cost cutting measures make it very difficult for everyone to remain immune to becoming unemployed, particularly in the defense sector. You should know that each sector of the economy cycles through it’s up and downs every 7-10 years on average. So if you have spent most of your life working and/or investing in one sector of the economy it’s highly likely you’re sector is going to go through hard economic times at some point that will require a reduction in force due to supply and demand which you could fall victim to becoming unemployed. Having multiple sources for income streams (passive and non-passive) will help insulate your family from unemployment!
On November 20th 2013, after 23 years of being on the fast track with a prominent defense contractor, a spotless career and a Master’s in Computer Science I became a victim to unemployment as a result of being laid-off due to major reductions in the work force the company needed to perform. I was shocked! I did not expect this to occur so suddenly given my proven track record. All of a sudden I found myself having to seek new, preferably equivalent, employment in a very difficult economy in order to maintain our current, hard earned and deserved lifestyle! More importantly, as the sole income producer I needed to obtain suitable healthcare for our family of 5.Credit: pixabay
One thing that is certain regarding unemployment and life in general is that the expenses don’t stop coming! Over the Thanksgiving, Christmas and New Year Holiday’s I took some much needed down time to just relax, but then at the first of the year I put together a plan to address two objectives: 1) Replace my current income maintaining our present lifestyle at a minimum and 2) ensure I had more direct control of my family’s financial destiny by having multiple streams of income available. Notice I did not state “find a replacement job”! I was very precise in defining my objectives. I did not want to be constrained trying to find a job in the struggling defense market and possibly limiting my earning potential. As a result of those efforts I am sharing 7 Ideas To Help You Save Your Family When Unemployment Strikes!
The ideas that follow assume you have or will follow sound basic financial planning to build your tax deferred and non-differed savings accounts and have sound financial credit. In addition, it assumes you have done other prudent activities such as filing for unemployment and other financial incentives that may be offered at the time. The below ideas are not meant to be a panacea but more for your consideration. During your search for re-employment you must keep a positive attitude during the toughest of times and know that you will find a solution! Without a positive attitude you’ll get down on yourself and likely quit or procrastinate which will make things worse in the long run! The great news is that there are a lot of activities that you will be able to earn a solid income from! You just have to be diligent about finding them and in most cases being receptive to change! The one resource we can’t get back is time! So staying hyped up, leveraging your connections and taking quick smart action will be critical to saving your family from the pangs of unemployment!
1) MAKE A LISTCredit: pixabay
This is most likely your one shot at getting a chance to act on pursuing something you really enjoy as a business to replace your old job or in conjunction with your new job. So before you start getting consumed with finding replacement work or alternative adhoc jobs that will derail you from thinking clearly; dedicate a minimum of 1-2 weeks to brainstorm with family and friends. Conduct mastermind activities that can be pursued as a primary business or alternate revenue stream you feel you would be interested committing to and doing every week. Running a business vice just working for someone is a big responsibility so great care should be taken to pick something that there is a perceived market demand for and that you will not simply quit on if you encounter some tough bumps along the way.
Keep in mind to consider using one or more business partners to help reduce the risk associated with starting a business if it’s too big for you to handle alone logistically and financially. You will be surprised to learn that there are many other people in similar situations as yours but afraid to bring up the idea of partnering! So don’t be afraid to seek out friends, family, forums and groups surrounding your areas of interest for possible investors or partners. Napolean Hill, author of "Think and Grow Rich" was a huge proponent of conducting masterminds to arrive at out of the box powerful ideas and solutions. Be sure to include ideas that will help you adhere to the principles presented by Timothy Ferris, author of the "4-Hour Workweek". Think of jobs or tasks you can invent or perform a limited number of times which can then run on autopilot or take minimal time to maintain yet keep making you money!
In addition to making a list of new job opportunities you’ll also need to do a complete detailed assessment of your expenses and any possible regular income you have. Duel income families will have more breathing room than single or no income families. You’ll need this assessment to truly understand how long you can safely maintain your current lifestyle and prioritize any cost cutting measures that will be required.
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2) BE TRANSPARENT WITH YOUR FAMILYCredit: pixabay
The news of being unemployed and all the things that comes rushing to the forefront of your thinking can be unbelievable and a lot to deal with. Everyone reacts differently to these type of situations depending upon your family’s personalities. Despite the pressures and wealth of information you will be dealing with, share the news with your immediate family members as soon as it happens. This way they can understand what you are going through, as well as, mentally get prepared for how they may need to lend a helping hand in making the situation more bearable for everyone. For example if your children are old enough they may have to get a part-time job to help pay for their car payments, gas, insurance, extra spending monies and other misc. costs if they normally don’t have to pay for these type of things.
There are too many reasons to list here as to why you should share your unemployment situation with your family. Keeping them informed and part of the solution not only can make the family stronger in tough times and one of them could very well be the one that sparks that idea or confidence to venture on your own or has friends who have job connections! Think of your family as your internal social network. So you should leverage them no differently than you would your external social network, if not more! Your family members will be your biggest advocates!
3) LEVERAGE YOUR EXISTING JOB MARKET CONNECTIONSCredit: pixabay
One would think this option would be the easiest to do and find replacement work closest to your field of profession. In most cases you would be absolutely correct and this is the general path most individuals take because it's comfortable to them and where they have the most experience! Or at least that’s what I thought. However, in dealing with my own experience I learned that a lot of unemployed persons were not able to easily return to their prior job markets due to economic conditions, salary constraints, the unmentionable age barrier that exists and external constraints like your families desires to remain in the local area due to friends, family, upcoming high school graduations and other details you just don’t have to address until your unemployed. Therefore these persons remained unemployed much longer than they ever expected and in most cases had to re-invent themselves and consider alternate industries after considerable amounts of time, money and energy had already been expended.
At the end of the day returning to your prior job market should be one of your easiest transitions back into the workforce to save your family from unemployment pains. However, unless your young and able to be highly mobile (i.e. willing to move), don’t underestimate the difficulty you might have in finding replacement work inclusive of the length of time it might take to be hired. Aside from having to tailor and customize your cover letter and resume to almost every job posting to ensure it gets through the automated keyword search gates, the trend now appears to take 2-4 months before companies are able to complete the hiring process. So expect your time frame to possibly take longer since you may not be the initial best candidate for the job, particularly with a large array of qualified candidates. What used to be a recommendation to have at least 6 months of your salary tucked away for times like this should be doubled to 1 year of your salary due to the re-hiring process taking so long. Time is our most limited resource that can’t be regained! If you’re in your 20's & 30's plan accordingly now to save diligently as time will pass you by quicker than you can imagine. That's a fact! If you’re in your 40’s or later and did not build an extended rainy day cushion then finding replacement work in a short order of time will be more critical. Hiring a head hunter who can quickly open doors for you may be well worth the upfront expense vice relying on LinkedIn, social media tool suites and scouring targeted company career databases for openings.
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4) GET INVOLVED IN REAL ESTATECredit: pixabay
Consider getting involved in real estate! Regardless of the fluctuations in the economy there’s someone always looking to buy, sell or invest in real estate. Although this market segment may seem overcrowded there appears to be plenty of business to go around. As the baby boomers retire the demand for real estate professionals will continue to be strong with excellent market diversification! One of the advantages of getting into the real estate business is its relative ease of entry to obtain your license and the essentially limitless types of available real estate professions (ie residential, commercial, leasing, rentals, property management, multi-family, renovations/flipping). A second big advantage is you get to be your own boss and manage your own schedule, ideas and other aspects of the business! So the sky is the limit!
Almost all activities with real estate will require you to get a basic Real Estate Agent License and register your license with an authorized real estate broker. You can get your license in less than 2 weeks by attending real estate school and taking a certified state exam at a nearby local office. Make sure you do your research as some schools are better than others in preparing it's students to pass the exam on their first try taking it. If you want to specialize as a broker, commercial properties or other areas additional training, certifications and licenses may be required.
There are areas involving real estate that do not require you to have a real estate license but still allow you to leverage the benefits of owning or investing in real estate. As a real estate owner and/or investor you do not need to have your real estate license but if you do it can be a bonus whether buying or selling. Presently with low bank rates and other security vehicles being offered for traditional methods of helping your dollars grow there is a renewed interest in making profits in real estate. One such method is to find devalued properties, purchase them and then resell them at a decent profit (ie flipping). You then seek out the next property you want to flip leveraging the proceeds from your prior sale as capital for the next purchase/sale. Flipping properties is typically done with residential rather than commercial properties. The general supply of bargain deals can be somewhat limited so caution should be taken before jumping into the flipping business to ensure you know what your profit margins, cashflow, availability of local distressed properties and the market purchase demand will be.
An alternative to flipping properties is becoming an independent real estate investor and/or owner in a property. You can be the sole investor to someone (i.e. a flipper, future owner, etc.) or be part of a deal involving multiple investors. As an strictly an investor this type of arrangement typically keeps your obligation strictly on the financial side of the equation. You can actually be the main person coordinating the deal, lining up investors and the seller of which you would earn a commission for all your hard work. Or you can be strictly an investor lending money to the transaction with a contractual agreement how your money will be paid back to you. A third option exists where you can be the coordinator of the transaction, as well as, an investor depending on how you want to structure the deal. You can visit Value Hound Academy to obtain more in depth information and connect with experienced real estate investors.
As I mentioned above the possibilities are endless in this arena! Real estate investing also provides a great way to establish passive income and leverage other people’s money. A word of advice is to not let all the available options and information overwhelm you. If you’re completely new to real-estate investing and/or would like to have extensive hands on coaching the curriculum offered by Robert Kiyosaki’s Rich Dad Poor Dad Coaching is fantastic. This 6 week online class is value packed with detailed modules which you can save to your local computer combined with weekly 1 hour personal instruction from qualified and licensed real estate investors on Robert’s staff. This course covers everything from the basics onhow to find properties that will optimize cash flow, locating investors and setting up your business infrastructure. This course will change how you view money! The Rich Dad Coach will give you feedback, hold you accountable, and encourage your success. The focus is on you and how you will create a plan for success. Having taken the course myself, I highly recommend this course if your serious about being a real estate investor/owner.
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5) START A NEW OR BUY AN EXISTING BUSINESSCredit: pixabay
Buying an available business for sale is also another viable option to unemployment. Depending on your background, purchasing an existing business may be an easy way to leverage a skill base that you already know and love! Or it could be your dream business that someone else has laid the foundation for you to pick up and run with. Buying an existing business has the advantage of bypassing many of the headaches associated with starting your dream business from scratch. If you’ve done your financial due diligence, it should be able to provide you with some form of solid cash flow as a salary, income distribution, employee owner benefits and other possible perks. Remember to leverage your accountant and legal team to assess the last 2-3 years of certified financials of the company and ensure no outstanding legal matters (i.e. upcoming building lease expiration/renewal is required, business has outstanding liens on it from subcontracted labor) exist against the business or owner that you might unknowingly inherit. If you don’t have a CPA and Legal Counsel Hire one of each to ensure you remain protected. It will be well worth the peace of mind despite the minimal initial upfront costs.
6) BECOME A FRANCHISEECredit: pixabay
In parallel to considering the above options you can inquire about franchises that would be of interest to you based on things you’re passionate about. If you don’t think you can be passionate about running a Franchise and deal with some of the constraints placed upon your business activities then scratch Franchises off your list now vice later since conducting the proper due diligence to see if it’s the right fit for you takes valuable time! As noted earlier your time is limited and you can’t get it back! So you need to spend your time and your nest egg wisely! However if the potential of becoming a franchisee is of interest to you consider leveraging companies such as The Entrepreneur’s Source (www.theesource.com) to help guide you through the process of identifying a reputable franchise from a large collection of franchises custom matched to your financial capabilities and interests. This service is completely 100% free to you and is funded by the Franchisor you actually become a Franchisee for. If you do not select any Franchisor after having gone through the process you still owe nothing!
As you go through the Franchise selection process you may discover that you really like a particular Franchise concept. However after conducting further analysis you determine that you’re going to need more revenue to help with getting the Franchise off the ground and you’re not sure where or who to turn to. The good news is there are essentially an endless supply of funding sources to help persons like yourself raise capital. Typically a representative with your Franchisor can provide you with funding sources that are affiliated with the Franchisor to support funding Franchisees. There are typically two types of funding you’ll need to consider: Secured and Unsecured. Secured funding will require you to go through the submittal of detailed paper work outlining your financial status (i.e. Profit & Loss statements, Asset & Liabilities, Net Worth, Liquid Capital, etc.) in addition to your credit score. Secured funding means just that. Should you or your business default on paying back the loan the loan is secured via a personal guarantor with your personal assets. Unsecured loans on the other hand are loans that typically will be issued based upon your credit worthiness and not require a personal guarantor commitment. The Interest Rate and Terms of either type of loan will vary greatly based on your particular type of business, whether it’s a new or existing business and your personal financial situation.Credit: pixabay
Another financial option is the use of your 401K to fund your business without any tax consequences for taking an early withdrawal. When you use your 401K for “Startup Business Rollover” purposes you legitimately avoid any tax consequence from tapping your 401K funds prior to your formal retirement. The cool thing about using this method is that you can take 401K contributions from your newly formed company and roll those back into your existing 401K tax deferred just like any other 401K plan. This type of plan is very flexible and allows you to also draw a salary unlike a “Self-Directed” IRA. A 401K “Startup Business Rollover” should not be confused with the “Self-Directed” IRA as they are completely two different types of plans with uniquely different tax regulations. The “Startup Business Rollover” provides greater flexibility than the IRA Self-Directed plan. Consult a knowledgeable CPA or contact a company such as Guidant Financial to obtain more detail on how you can fund your business adventures with a 401K “Startup Business Rollover”. Guidant Financial is a leader in its industry and can set up and administer your plan to avoid any issues with the IRS. You can also leverage the 401K “Startup Business Rollover” for nearly any business you wish to create.
7) LEVERAGE SOCIAL MEDIACredit: pixabay
Finally, as an additional primary or secondary set of possible income streams, consider looking into running an online business. With the power of the internet and reach of social media to practically anyone in the world there are endless opportunities to make money online! There are tons of success stories, as well as, failed online businesses just like there are in the offline brick and mortar market. Chances are you and family members may already be generating sales using social media and the internet but on a smaller scale. Should you already have a product (eBook, teaching video, coaching video series, T-shirt sales, etc.) or service (i.e. consulting, drop shipping, web development, etc.) consider ramping it up to the next level to see what you can make of the business especially if your already having some success online. If nothing comes to mind consider brainstorming or masterminding with other people special knowledge, qualities or skills you possess that others would be interested in, especially if it helps people solve a core need their seeking a solution for. Leveraging others inputs will help insure you don’t limit yourself too much as we are often our own hardest critics. In parallel you can learn to sell other peoples products made available to you through social revenue sharing sites such Clickbank, Commission Junction, JVZoo and others and earn affiliate commissions. If you need help understanding how to effectively & efficiently brand and market your product online feel free to contact me as my company specializes in teaching persons such as yourself how to brand themselves and market online to generate traffic, leads and sales.
As I mentioned, none of these are a direct cure for saving your family from the pains of unemployment but hopefully they have given you nuggets of information you can do additional research on. You’re also more than welcome to contact me directly and ask any questions you might have of my unemployment experience. I would liked to have provided more in depth information here but this article was already getting too long and I apologize for it’s length. The ideas presented above describe the process I went through to address my two personal objectives: 1) Replace my current income maintaining our present lifestyle at a minimum and 2) ensure I had more direct control of my family’s future financial destiny by having multiple streams of income available. Hopefully this will spawn your own creative ideas unique to you and your family and friends should you find yourself unemployed. Stay positive, leverage your family and never give up!
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