Speaker 1: Let's say good morning too. The host of How to
Speaker 1: Money Sunday's noon to two on KFI, it's Joel lars Guard. Joel.
Speaker 1: I just mentioned that federal employees could be losing their jobs,
Speaker 1: and with a lot of federal layoffs kind of looming,
Speaker 1: and of course there's always private laoff. Starbucks just announced
Speaker 1: they're cutting like fifteen percent of their corporate workforce. We
Speaker 1: need to talk about how to get ready for a
Speaker 1: potential layoff.
Speaker 2: Yes, yes, we do. And yet that is that's been
Speaker 2: one of those one of those things that's always true,
Speaker 2: is that every individual you could be laid off, especially
Speaker 2: like if you're working for the man, right if you
Speaker 2: don't run your own business, like you work at the
Speaker 2: pleasure of the business that you work for. And we're
Speaker 2: seeing this in particular with like what DOGE is doing
Speaker 2: with the federal government. This I'm really sad about what's
Speaker 2: happening for a lot of individuals who are on the
Speaker 2: federal payroll and DOGE seems to be cutting indiscriminately. And
Speaker 2: even people I think who who think that there's room
Speaker 2: to cut ending in the government, they might not love
Speaker 2: the way though is going about this. But where I'm sitting.
Speaker 2: I think it's really important to highlight how you need
Speaker 2: to be prepared for a layoff, whether you're a federal
Speaker 2: worker or not, because, yeah, if you're working at Starbucks Corporator,
Speaker 2: wherever you're working, there's always a chance, right that the
Speaker 2: that there's an economic downturn of the experience, or even
Speaker 2: if there's a personal downturn in your life, or there's
Speaker 2: an industry downturn in that you know, in your particular
Speaker 2: section of the workforce, and it's important to be prepared
Speaker 2: that you might not have your job, you know, weeks
Speaker 2: or months from now. And that's why for me, like
Speaker 2: the biggest piece of advice I can offer to people
Speaker 2: is to increase your savings rate and to try to
Speaker 2: get up to having that three to six months worth
Speaker 2: of living expenses in a bank account that is ultimately
Speaker 2: your essentially short term insurance against some sort of potential
Speaker 2: layoff that might be coming down the pike.
Speaker 1: Okay, three to six months, and you want that sitting
Speaker 1: in a savings account, not in a place where you
Speaker 1: can't get to it.
Speaker 2: Right or got Yeah, it's got to be liquid, it's
Speaker 2: got to be accessible. If you're sticking I literally had
Speaker 2: a question from a listener recently. She's crushing it on
Speaker 2: the investing side, maxing out like a four toroh one k,
Speaker 2: which is a ton of money to be investing every month.
Speaker 2: But then on the flip side, she's like, I don't
Speaker 2: have any money in savings, and I don't want that
Speaker 2: to be the case you. I love the idea of
Speaker 2: investing for your future, obviously, but I don't want you
Speaker 2: to do it at the complete expense of having liquid
Speaker 2: funds accessible. And so what that means for most people
Speaker 2: is to have like at least twenty five hundred bucks
Speaker 2: in savings. That's the initial amount I want you to
Speaker 2: secure because that's going to get you through most bumps
Speaker 2: in the road, and then you can start taking advantage
Speaker 2: of let's say, like the match in your four O
Speaker 2: on K, while you're also building up that emergency fund
Speaker 2: to be a bigger amount. But ultimately that emergency fund, yeah,
Speaker 2: is going to be a big help if you do
Speaker 2: lose your job. It's going to provide you the ability
Speaker 2: to keep the roof over your head and to keep
Speaker 2: food on the table. And something else I talk about
Speaker 2: pretty frequently is something called a bare bones budget, and
Speaker 2: I want people to institute one of those as well.
Speaker 2: We've got an article about it on howto money dot
Speaker 2: com if people want to know all the details. But
Speaker 2: essentially it's like, hey, how much can I cut if
Speaker 2: the stuff were to hit the fan?
Speaker 1: Right?
Speaker 2: Like, if I did lose my job, how much could
Speaker 2: I cut back on my monthly spending. I'm not asking
Speaker 2: people to go bear bones budget while they've still got
Speaker 2: money flowing in, but it's a good idea to at
Speaker 2: least be prepared for that and to say, listen, I've
Speaker 2: thought through this. If I were to lose my job,
Speaker 2: I can cut back my monthly spending from forty eight
Speaker 2: hundred dollars a month down to thirty three hundred dollars
Speaker 2: a month, and that would give my emergency fund an
Speaker 2: extra month and a half or two months to me
Speaker 2: to keep me solvent. So I think that barbones budget
Speaker 2: is another thing, and I love for people to actually
Speaker 2: create it before something like a job loss occurs, that
Speaker 2: you kind of have that confidence if it does.
Speaker 1: Come about, Yeah, so create it now and then set
Speaker 1: it aside for in case you need it so you
Speaker 1: don't have to expect. We don't have to do it now.
Speaker 1: So I can keep my Burke Williams membership for another
Speaker 1: couple of months at least.
Speaker 2: Right, But it's nice to know, oh, hey, if I
Speaker 2: lose my that's that's gone, right, Or the eating out
Speaker 2: is gone for the time being, or some of these
Speaker 2: subscriptions that they're gone. Like you can't necessarily get rid
Speaker 2: of a car payment overnight, right, but that's something you
Speaker 2: can you can kind of have your eyes looking forward
Speaker 2: to that. But there are other things that you can
Speaker 2: cut immediately. And yeah, it's stinks you're going to miss
Speaker 2: that thing, but the whole goal is to make sure
Speaker 2: that you have enough money for the things that are
Speaker 2: that are crucial.
Speaker 1: Yeah, such great advice from our buddy Joel Larsgard, who
Speaker 1: you can listen to every Sunday on how to Money
Speaker 1: noon to two right here on KFI. You can also
Speaker 1: follow Joel at how to Money Joel and I want
Speaker 1: to check out your bare bones budget at howtomoney dot com.
Speaker 1: Thank you, Joel.
Speaker 2: Thanks Amy,