Have you ever given any thought to this? What would happen to you, your finances, your living situation if you lost your job?
My job is mostly contract work, I get paid a salary but that salary depends entirely on how many contracts our company has and how well the company is doing since I own 50% of the company. (Family business) Last May I posted that we lost one of our contracts with more possible on the line, since then not much has happened, my income has remained relatively stable and I’ve just continued on living life and planning for the worst while hoping for the best.
However, thinking about this more this summer I’ve come to realize that my emergency fund is still rather small. If I lose my job, then what? I’ve thought about plain survival; I laid it out pretty well in that post I just referenced, my options on how to survive have slightly changed but this is pretty much what could happen:
1. Look for another job immediately and I would take ANY job in order to keep from depleting my emergency fund completely.
2. If I had to I could survive for 4-5 months without any income by just living from my emergency fund that currently holds $6,200. and
3. I could survive about 10-11 months by withdrawing my RRSP, selling the stocks I hold and living off the emergency fund and
4. I could stretch the situation to 12-18 months by withdrawing my RRSP, selling the stocks I hold and living off the emergency fund and selling off some other investments I hold.
If I really absolutely had to I could survive a year and a half with no job. It would be a miserable, broke 18 months but it could be done. Ultimately though that can’t me mine-or your-plan in case of jobloss. What comes after losing your job is more than just planning for next weeks rent or food. The plan needs to encompass more than just planning to survive, what will do you to replace your income 5 years down the road, what about ten? What skills do you have, what are your options?
With these thought in mind (and my relentless thirst of knowledge) I am considering a Master’s degree (or an MBA) I’m not sure yet but it’s an idea to build on my skills to qualify for better positions. If I lost my job TODAY I would probably find a part-time job, finish my house, sell my house and move back to the Netherlands to pursue the Master’s degree I’m considering. In the meantime, between now and the end of 2012 I plan to attack my emergency fund with a renewed focus. It’s time to get that baby up to $10k, because just maybe, maybe you can buy (some) peace of mind. 
What would you do if you lost your job today?
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This exact situation happened to me. I lost my job of 10 years last year. Wen I first found out about it, it was hard. I worried a lot and stressed a lot. But now that we are a year without me working,I realized exactly how much money we we wasting. It has taught us a lot and when I do eventually find work again, the way we deal with our money will forever be changed for the better. Having a heft emgency fund gives us comfort, but its so great to say that as of now we have only had to use a ver minimal amount. It's very hard emotionally at times, but we are getting through it.
Posted by Crystal | January 3, 2013, 12:19 amI would freelance and travel. Perhaps not the wisest financial choice, but it's something I want to do and that would be the perfect opportunity.
Posted by @eemusings | January 3, 2013, 1:39 amI share the same view as you do when it comes to emergency fund (I am also working on mine), job loss as well as pursuing higher education. There are a lot of variables in my life at the moment. I hope to have some direction in where I am heading by the end of this month. One thing I feel very strongly about is higher education, possibly a MBA.
Posted by A Dash of This and That | January 3, 2013, 3:40 pmIf I lost my job today I would likely look for another. My job is in demand so I wouldn't have a problem finding one in my area. We don't have any debt at all so that wouldn't bother us but we still have to pay bills and live whilst saving for retirement. I think this is why we saved and budget the way we do because in our heads we always asked "what would we do" and we didn't want to be in such a pickle that we were left with no options. I realize not everyone is debt free and losing a job is a big deal, heck it's happened to my wife and it was difficult for her but she moved on. Life is not easy, and likely never will be. Mr.CBB
Posted by Canadianbudgetbinder | January 3, 2013, 8:29 pmI think this is why I'm working hard to build multiple income streams. It'd be horrifying if I had no resources today. Sure, I'd last about eight months without a job, but what then?
Posted by AverageJoe | January 9, 2013, 12:52 pmI would definitely cash out my emergency fund and move to someplace cheap to regroup. There are a lot of places in the world that are cheaper than the US and Canada. Thailand, for example, is a nice country where you could easily get a gig teaching English and living on the beach. I'd probably do this for a while, and continue to look for another job that would pay more and allow me to move back.
Posted by Isa@CreditCardShoppe | February 10, 2013, 7:59 amIt’s a scary prospect and I’d wonder how I’d pay my mortgage, health insurance, bills, etc. It might lead me to ask for some help which I hate to do.
Posted by Jerry | February 24, 2013, 7:30 pm