Five Strategies for Maintaining Control of Your Career and Lifestyle

For many of us, the daily routine of our jobs becomes a source of comfort. We wake up, head to work, and commute home. Every couple of weeks, a deposit is made in our bank account, the bills get paid, and we move on. And today, this level of comfort is only multiplied by historically low unemployment rates (most recently around 3.7%) which have led to employees seemingly having more negotiation power than ever (ask CEOs about their success in implementing return to work strategies).

But over the course of the last few months, several economic factors have created profitability headwinds for many employers. Inflation has waged war on profitability. Higher interest rates have increased corporate borrowing costs. These factors along with a workforce that is increasingly valuing work-life balance (as we think they should) have the potential to make firms less profitable. In many cases this causes CEOs and CFOs to take a careful look at their most important and largest investment: their people.

There is certainly no shortage of headlines in this regard, with 2023 layoffs occurring within technology (Alphabet, Amazon, Meta, Microsoft), financial services (BlackRock, Accenture, Goldman Sachs) and seemingly everything in between (Disney, FedEx, McDonald’s). For many of these companies, paring back their employment expense is a necessary action to ensure it can weather the current economic environment and maintain high levels of profitability. And while layoffs and restructuring are nothing new, they are undoubtedly disruptive to those directly impacted.

In 2021, the company I worked for was acquired by a foreign asset manager. As a result, my role was eliminated and I went through the process of determining how I would move forward with my life and career. I learned some valuable lessons from that experience.

Here are 5 key strategies that will help you maintain control if you’re ever in a similar situation.

1) BUILD UP AN EMERGENCY SAVINGS ACCOUNT, NOW

When faced with job loss, you don’t want to be forced into taking a job you don’t want or be underemployed because you don’t have enough savings to bridge your employment gap. A liquid emergency savings account can literally buy you time, allowing you to maintain your lifestyle and not feel hurried into your next move. As a general rule of thumb, we typically recommend dual income households to maintain three months of expenses in savings at minimum and single income households to build up six months’ worth. A quick review of your expenses via your bank account and credit card statements should give you a good sense of what it takes for you and your family to maintain your current monthly expenses. That should help guide you to a number. Then it’s just a matter of being disciplined to build up to that amount.

TIP: If one spouse’s income is significantly higher than the other, you may want to consider shooting for a bigger savings goal.

2) Consider turning your passion into profit

Pursuing your passion doesn’t have to be a daydream. For many of us, there are things we enjoy doing outside of our day-to-day jobs that provide us with a different type of satisfaction. And some have the potential to turn into income for our families. Think creatively about the things you do outside of work and what you enjoy, and make a plan. Whether it’s refurbishing homes or furniture, providing in-home IT support services or freelance writing, an LLC is easy to set up and relatively inexpensive (as little as $500). At the very least, the additional income can lessen the impact of a job loss. And at best, you may have just built your next career.

TIP: Take time some evening or over the weekend and visit some locally owned businesses to see how they operate. If possible, talk to the business owner to see how he or she started and what she likes or doesn’t like about her work. Do some online research to find businesses in fields you enjoy to learn how they are monetizing your passion. No matter how big or small, running your own business isn’t for everybody, but it can be extremely rewarding.

3) Stay visible and attentive to your network

Maintaining connections both within your industry and outside of it can be personally rewarding and potentially shorten the amount of time it takes for you to land that perfect next role. For many of us, we are often so focused on the work at hand that we spend very little time interacting with those outside of our own organization. Being active in local industry groups, on LinkedIn, and just by reaching out with a text or phone call with someone you know in the business can go a long way to making sure you are top of mind when you need to be.

TIP: Add a quick review of your LinkedIn feed to your daily activities over coffee and make sure to “Like” and post when it makes sense. There are easy to find resources online that provide insights into LinkedIn’s algorithm that can help maximize your visibility. Also, commit once a week to one of the following: creating a post on LinkedIn, attending an industry event or inviting someone from outside the company to lunch or a happy hour.

4) Know your options, literally

There are a myriad of different ways compensation gurus have designed pay packages to provide short-term and long-term incentives for employees. These benefits are often in the form of equity or profit-sharing and depending on the performance of your company, this can be a significant portion of your net worth. But, as it often is, the devil is in the details. How is that compensation awarded, what is the vesting schedule, and what happens in the event of termination? These are just a few of the details to understand. Locate the plan documents that govern these programs (your HR department should be able to help) and read the fine print or ask a competent financial professional for help. Having a firm grasp on what is owed to you, as well as maximizing the after-tax benefit, can go a long way in determining how you view these assets and what role they play in your financial security.

TIP: Determine a prudent amount of your company’s equity that makes sense for you to own in the context of your liquid investments and overall net worth. If your company experiences a period of poor performance, it is possible that you lose your job as well as a considerable amount of financial assets at the same time. By choosing an appropriate percent allocation to company equity and sticking to it, you can thoughtfully design a plan to diversify and reduce this single company risk. There are a number of factors to consider here including your risk tolerance and tax situation, so consider consulting with a competent financial professional.

5) Self-care is not selfish

If there is one thing we have collectively learned over the last several years, it’s that focusing time on our mental and physical health is critical. And when under the stress of a demanding job or a challenging environment at work, sticking to a consistent plan of physical and mental exercises, eating healthy and getting quality sleep can do a lot to ensure you are in the right frame of mind when faced with difficult decisions.

TIP: If you are still working from home, commit to a short walk each day. Even a 10-to-20-minute walk can do wonders to relieve your daily stresses and get you in the right frame of mind. Another advantage of the work from home environment is the ability to incorporate a power nap into your day. Just the act of closing your eyes and resting on a comfortable couch or your bed for 20 minutes over the lunch hour can lead to a highly productive afternoon.

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