“You are sacked tomorrow.”
These were the precise words spoken to me.
Although luckily, they were not spoken by my boss to me but instead these were the words my brother used on me.
This was an internal joke in our family because I was supposed to be helping my brother out at the expo food fair but due to some logistics rearrangement, my help was not need for the next day and therefore, “this joke”.
But his words gave me a rude awakening. This could jolly well happen to me, or to anybody holding a job. Our career fate is determined by our bosses.
Many people who have not been investing, financially, often give the excuse that investing is risky. They think that holding a job is safe and secure because it gives a fixed and stable income. However, how safe is it really if our career fate is being held in someone else’s (boss) hands?
Don’t get me wrong. I’m not advocating quitting your job or be an entrepreneur. Not everyone is cut out to be their own bosses. Personally, I’m still an employee.
But it is important that we constantly invest, be it investing in ourselves or in financial instruments.
Why?
To better prepare ourselves and be able to ride out unforeseen tough financial situations when it happens.
Of course, the bigger question is ‘How?’.
By keeping an emergency saving that is equivalent to about 6 months of the monthly expenses that you need.
And by emergency saving, the keyword here is ‘to save’ and being an emergency funding, it should not be touched except in an emergency.
This is only the first step. If you currently do not have a savings built up somewhere that is equivalent to 6 months of your monthly expenses, start doing so now.
Why do we need this 6 months emergency funding saved up? Well, because our bosses can choose to sack us tomorrow, we want to be able to survive through such a crisis, don’t we? But until we have gotten our next job to give us that ‘fixed and stable’ income, we still need money as we have daily expenses to incur, expenses like food because we still need to eat although we lost our jobs. And usually for most people, 6 months should be sufficient for us to get another job. If not, 6 months is also a good enough time frame for us to get over and re-strategize our next moves. Of course, 6 months is just a benchmark. If you think you need more to survive, go ahead to buffer for more.
And if you already do have an emergency funding saved up somewhere, the next step is to carry on saving to build up another funding meant for investment. I won’t go in depth about this investment funding or what are the available types of investments in this post as these topics can be quite lengthy. Do keep yourself updated with my blog and keep learning.
