Preparing Yourself For A Work Stoppage

no-work

Hi everyone today I thought I would write about something that I’m going through. On Sunday a strike was  narrowly avoided by my union as we came to an agreement with the province of Ontario. I am a member of CUPE (Canadian Union of Public Employees) I am one of 55,000 people on strike to protest the cuts to education the government has made. The goal of the post is to help you financially in case you are ever laid off from your job, go on strike like the General Motors workers in the United States effecting 50,000 employees in the US and around 10,000 in Canada.

My situation started back in May, about the third week of May to be precise when I was handed lay off notices, which were to take effect August 29th. At that time I was working 40 hours per week, and at the start of Sept I would only be working 12.5 hours per week, just like that I had lost 69% of my hours. In my case I had three and a half months to prepare myself for lower hours and a possible stoppage of work. I was fortunate it this regard other people aren’t so lucky, you could get laid off immediately from a job without any warning.

Below I came up with some ways to help you through a job loss, a reduction in work hours or a strike if you belong to a union.

Build An Emergency Fund

Having a emergency fund will protect you and your family from a job lost, reduction in hours and a work stoppage. Also if something unfortunate happened and you would be unable to work for a long stretch of time. In the media and books you will see a lot of people say its ideal to have a three to six months worth of income in an emergency fund. I am a cautious person so I would recommend six to 12 months.

I currently have 12 months saved up in my emergency fund. I was able to save up this amount by putting money aside every pay. I currently have my emergency fund sitting in a online bank here in Canada called EQ Bank I currently earn 2.30% in interest. If I stayed with my regular bank I would only be earning 1.07%.

Pay Off Debt

If you suddenly got laid off or injured on the job this idea might not be the best. But if you know ahead of time that there maybe possible work stoppage or unrest in the months ahead I believe it is a good idea to pay off debt to free up your cash, in case the worse happens.

For me when I mentioned above that I got my layoff notices in May, I had two loans a car loan and a loan to my parents. At the beginning of August I had the ability to pay off my loans and I did so. This was a great relief to have these paid off now it is freeing up my cash flow to invest and save for my future.

pay-off-debt

Reduce Monthly Bills

If your household still has a landline phone, cable and internet did you know you can have your monthly bill reduced? All you need to do is phone your provider and ask for a better price, if they are hesitant tell them you are looking at another service provider. My family has had pretty good success doing this, they still have all three services with a single company and they phone and negotiate a better price, they usually end up saving $40 to $50 per month.

Another bill you could potentially save on is your cellphone. If you have the ability to save up and buy your phone outright that gives you the opportunity to choose your own monthly plan and you can changes plans at anytime. Another advantage to this is your not locked into a two year plan and pay more than the phone is worth.

cell phone

Save On Groceries

Another good way to save money is when grocery shopping. My family uses the app Flipp which has all the flyers from our local stores and before we go shopping we look at all the flyers to see what’s on sale. If not sure if every Walmart price matches but our local store does so if we see something on sale from a competitor we bring my phone and show the cashier the flyer from the Flipp at and we pay the reduced amount. I’ve also found that you should never shop on an empty stomach because that way everything starts looking good and before you know it your cart is full of groceries that you don’t need and causing you to spend more money than is necessary. I’ve found planning ahead and writing down what you need for the week helps me to reduce my grocery bill, it allows me to walk into the store and remain focused on the things that I need, not to often have I strayed from the list and purchased other things.

grocery list

Use Loyalty Points

How many of you belong to a loyalty rewards program? I certainly do I currently have the PC Optimum rewards program and that is the only one I use. To try to maximize the points that I earn I have a President’s Choice Mastercard that is linked to the program and my account and I use it for every single purchase I make. Every week (Thursday) you receive your own personalized list of bonus points you could earn if you buy certain products. I don’t buy everything on the list because I usually don’t need them, but some are helpful for example I could receive an offer to buy gas from a Mobil gas station, I take advantage of that every time. In the last year and a half to two years I had accumulated 345,000 points in dollar terms that means I have $340 worth of groceries I could buy.

Since the beginning of September I have noticed that my fuel bill has been rising significantly and with my reduced work hours I wanted to try and get my loyalty points to help me financially. The one down side to the PC Optimum program is you can only redeem the points for groceries you can’t exchange points for gift cards. Thankfully I found a way around this starting last week I am having my family buy me gas gift cards from Mobil in exchange for buying their groceries with my points, that way everyone wins. I expect this will save me with my current job about $50 to $60 per week.

So if you belong to a loyalty program and you lose your job I highly recommend looking into redeeming your points and get them working for you. If you can redeem for gift cards for stores then perfect that will be a big savings for you. If you can’t redeem for gift cards like myself talk to family members like I did.

customer-loyalty-program

Well folks there are a lot more ways to save money, but I don’t want the post to become too long. I hope you are never in a situation where you lose your job or face a work stoppage. I can only say prepare for the worse just in case something happens and that way you will be protected.

Thanks for reading

Matthew

4 thoughts on “Preparing Yourself For A Work Stoppage

  1. This is a great article, Matthew. As dividend investors, we always think about the end goal of retirement and having financial freedom. However, we tend to forget about the curveballs that life throws us, and that we must definitely have some sort of emergency fund in place.

    I know that we are all wired differently and that we shouldn’t be judgmental towards others, but it always baffles me how some people live from paycheck-to-paycheck, without putting much thought into their finances.

    It’s also great that you mention about paying off debt no matter what. Some fifteen years ago, I received two interest-free loans from my brother-in-law and mother when purchasing my new car. I first paid off my brother-in-law. When it came to start paying off my mother, I got injured and got on worker’s compensation. My mother, feeling sorry for me, told me that I could pay her back whenever I had the money. I asked her had the bank loaned me the money, would they have felt sorry for me and said the same? I’m happy that I decided to pay her off in the following months, becoming debt-free.

    Keep up the great work, Matthew, and good luck with everything!

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  2. I’m glad that it all worked out in your favor. I agree with all the points about financial prep. An emergency fund of 6 months of fixed expenses is a must! I would like to add another important point for anybody that loses a job. While you’re looking for another decent job, get a temporary job right away. It could be a part-time job at a grocery store or an evening shift at Walmart. It doesn’t really matter. The goal is to have some kind of cash flow to minimize the use of emergency funds.

    Liked by 1 person

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