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December 22, 2000

Preparing for the year ahead

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It is hard to believe that another year is about to end. I hope all of you had a fun and productive year. Of course, as many tech workers are finding, the future doesn't look quite as bright as it did last year. As the Internet sector moves from childhood into its teen years you will find that both money and perks might be harder to find. Along with this general slowdown you might experience setbacks both known and unforeseen. The most important action you can take right now is to spend a few minutes to organize both your personal, professional and financial life.

Deer in the headlights

The best time to attack a problem is when you have some time to evaluate the problem and frame a response. I have a personal example that I am dealing with right now. There is a possibility that the Writer's Guild of America will stage a strike when their contract expires in May 2001. Since my wife works as a television writer this could have a dramatic effect on our lives. Fortunately, though, we have several months to prepare should this job action take place. Should you find yourself facing a possible layoff, or a downturn in your independent contracting income the following preparations might help you as well.

Since you know trouble might be coming you have some time to reduce your debt and increase your savings. Both of these actions will place you in a better position whether a downturn comes or not. Take stock of how much money you spend on a monthly basis. Then, look at those items you can cut out. You might be surprised how much money you can save when it is required. You might actually find a few items that you can remove right now. Perhaps you have a lingering Internet dial-up account that you don't use anymore or an extra phone line that really isn't needed. Take a few minutes now and clean up these items. You will then have 1 or 2 fewer items to worry about.

When you are done figuring, put the information aside until you really need it. Simply making the preparations should offer you a little peace of mind. You will know you are prepared for any eventuality and there is no use worrying over something that hasn't yet occurred.

What's that in the road?

Of course, not every eventuality can be planned. The economy rises and falls with regularity and companies coalesce, acquire and fail. Preparing for unforeseen problems can be the most difficult, but also the most important. They are both difficult and important because they require you to address your finances as a whole on a regular basis.

Too often we don't pay enough attention to our finances when times are good, but this means we often suffer when times are bad. When you are in a good job, make sure you are putting a significant part of your income away for when you will really need it. In some cases you may not need it until you retire and in others you may need it next week. Your goal is create a cushion that can carry you through several months, if not a year or more of bad times. There are several reasons for this.

First, knowing you have a cushion will make you less likely to jump at the first new job that presents itself. Remember, you are striving to develop a career, not merely jump form job to job. Your cushion gives you the time to evaluate each new job offer carefully until you find the right one to further your career.

Second, this money cushion can help to reduce the amount of stress associated with changing jobs. Everyone in your family will be more patient and understanding knowing that they have enough money to buy groceries and pay the mortgage. Again, this allows you the time and attention to make the right decisions.

Third, once established, this cushion will be there for whatever happens in your career or your life. Perhaps you need to take a leave of absence to help care for a new child or an ailing family member. You might have a health problem yourself. Set aside some money today for these possible, yet unforeseen crises. You may end up spending the money later on a boat or RV for your retirement, but the mere presence of this money cushion can help keep both your career and your life on stable ground.

about this column.

Douglas E. Welch is a freelance writer and computer consultant in Van Nuys, California. Readers can discuss career issues with other readers by joining the Career Opportunities Discussion on Douglas' web page at: http://www.welchwrite.com/dewelch/ce/

He can reached via email at douglas@welchwrite.com