Friday, April 11, 2014

Be Prepared for the Loss of your Job

When corporate firms signal their intention for restructuring an organization, there will always be uncertainty that sends their employees morale down their spiral. In today's context, we see pressures coming in from top management and shareholders on how they can come up with a leaner processes that will drive up their profit margin and lower their overhead.

No levels are secured - from the junior assistant to the Director level. Anyone at any point in time can be retrenched at the mercy of where the company direction is going. That's what happens recently to SPH who undergo restructuring in order to have a leaner processes and eliminate inefficient resources.

I've spent two years at my current company and now I've probably undergone two major restructuring within an organization itself. Some people who are close to me are directly affected and it is never easy for an organization to go through that in the short span of time. Morales are down, employees are uncertain and productivity to a certain extent goes down in the short term. The overall direction of the company may be going the right way, but as an employee you never are going to relate the same way as a shareholder does.

In these circumstances, the question people usually ask is how well are you prepared for such a retrenchment? Do you have an alternative plan on how are you going to cover your basic expenses for the family? Do you have any transferable skills that will enable you to find another job elsewhere? Maybe here are a few things to get you started:

1.) Have an Emergency Funds

This is where the importance of emergency funds kicks in. You should be prepared to work around your finances well even when things are going well for you. The idea is you never know what is going to happen next to you as long as you work being an employee depending very much on that paycheck at the end of the month.

2.) Regular reviews of monthly expenses

Conduct regular reviews of your monthly expenses and see which of the expenses you can easily strike off from the lists and which is the more important ones. You should be able to segregate the necessities from the luxuries and work on covering the basic necessities expenses while you are still working.

3.) Enhance your productivity

Consistently enhance and upgrade your skills in order to meet the requirement the world needs. Always remember that CHANGE happens within our world whether we like it or not. It is always up to ourselves on whether we want to change for the better that can improve on our productivity and marketability.

4.) Build up your passive income

The idea of passive income is to allow you to eventually do nothing but still receive a stream-flow of income, for whatever use you want it for. To start young means you will have a much longer time to build up your sandcastle so that you will have a canon stream of income when you get older while your employability does get lower.

Most people in Singapore are tied down to major necessities expenses such as housing, cars, renovations, education loans, parent allowances, school fees, maids and so on. This is why money management is even more important for these people who knows that they cannot absolutely afford to lose their job. Working on the above 4 points will at least gets you the start they need, but it needs to start early - when your job is still relatively "Safe".


  1. One point to add is that your boss may change to someone whom you cannot get along with. If one's passive income is able to cover his basic necessities, decision to take up a job with a lower pay but happier work environment becomes much easier.

    To put it simply, the feeling of not being bounded by a paycheck is priceless.

    1. Totally agreed with you on not being bounded by a paycheck is priceless. Furthermore, it adds dignity to your lifestyle

    2. Hi betta man

      I totally agree on your last point on not being bounded by paycheck is priceless. Having said that I am still working towards my end goal so I am sucking to it for now ;)

  2. I have seen 2 major restructuring within the 3 years plus which i've been working in my company. I've seen thousands of people either got out-sourced or retrenched by these restructuring programs. My boss has changed 3 times and luckily i get along well with all 3 of them including my current one.

    1. Hi SGYI

      Wow it looks like many companies are cost cutting and improving efficiencies now. The more reason why we should strive not to be bounded by paycheck the sooner the better isnt it.

  3. B,

    I've survived 2 rounds of retrenchment exercise during my short 2 years at Montgomery Ward Buying House in Singapore. I can relate to that uncertain experience.

    Your valid points tend to belong to the "save more" or defense category.

    I would like to complement what you say with an "earn more" or attack strategy:

    Networking. (Marketing of No. 1)

    There is a reason why some volunteer their time after work to serve in professional bodies or spiritual/charitable organisations.

    Of course this trick only works if we are good. If we are "average", we wouldn't want our peers in the same industry to know do we?

    How do headhunters make us offers if they don't know our existence?

    1. Hi SMOL

      Sometimes networking can also come up with a purpose and this is more what I am doing these days. In the past plain meeting random people just doesnt seem to work much. Networking usually are associated with expenses and time outflow so I usually chooses the "better" networking eventz ;)

  4. Paying off housing loan asap and be debt free is NOT part of this Game?

    1. Hi CreateWeath8888,
      Paying off housing loan asap. Can be done as I have done it.
      But being debt free? How to when you have to see your son/daughter going through university etc? This debt is hard to be free unless you have a genius offspring.
      What do you recommend for an averge class family to be debt free for this part?

    2. Hi anonymous

      I would think sensible family planning is key. If we are not ready financially dont plan on having lota of kids to further burden you financially. Always aim to improve skills and productivity on one self first then get married appropriatelyand have right number of kids.

  5. I agree with you that we need to upgrade and learn other skills. Nowadays, loyalty counts for nothing in Singapore. Company always place profits as priority. So always make sure you have multiple sources of incomes and in-demand job skills. Don't underestimate your blog. Who knows ten years down the road, it could be worth a lot of money?

    SG Wealth Builder

    1. Hi Gerald

      Loyalty really counts for nothing these days not even a piece of paper. Which is why employees should suck employers when they are performing good cos it will be the other way round once you past that stage.