Magazine article Ebony

Recession-Proofing Your Life

Magazine article Ebony

Recession-Proofing Your Life

Article excerpt

Concerned about layoffs at your job or in your industry? Worried about how long you'll continue to earn a paycheck? Have you already received a pink slip? Job cuts jumped dramatically at the beginning of 2008. And it takes three months on average to find a new job, though in some sectors, the job hunt can take much longer. Losing your single biggest asset--your job--can be devastating. So it's essential to protect it and nurture it--and then also focus on Plan B as you look forward to a new job and career. While you're still working, don't take anything for granted.

* Review all benefits offered by your present employer. Make sure you know what you have and what you are entitled to get from health insurance plans, flexible spending accounts, insurance coverage and employee discounts. If you get laid off, you can continue your health insurance through COBRA (though rates will rise significantly). COBRA is a federal program that may allow you to continue group plan coverage for up to 18 months and in some situations as long as 36 months. However, you must pay the full premiums and often a small administrative fee. And you must have been enrolled in your employer's health plan to continue COBRA coverage.

* Boost your emergency savings. Only you know how much of an emergency cushion will let you rest easy. Most financial advisers say you should keep three to six months worth of living expenses. But in tough economic times, padding your reserve with a few extra dollars is extremely prudent. To jump-start the emergency cash stash, redirect a portion of your new 401 (k) contributions to a short-term savings account or put the money in a Roth IRA. Contributions to this type of individual retirement account can be withdrawn at any time. If you don't need the money, contributions and earnings can be taken out tax free after you're 59. …

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