A layoff planning checklist for anyone worried about their job right now
Global layoffs are on the rise this year, and the Indian workforce seems to be taking the brunt of it with many of my friends and family living with the quiet stress of a potential income loss right now. It is a vulnerable spot to be in, especially with dependents at home. So I wanted to share a few things that I’ve been recommending to friends and family as well, in case you ever see a layoff heading your way -
1. Know your actual expenses for each month - Capture the actual outflow, including rent, EMIs, groceries, school, house help, subscriptions, SIPs. Every layoff decision (how much emergency fund you need, how long your runway lasts, what to cut first) is built on top of this number.
2. Understand your loans - Know your EMI, your prepayment terms, and whether your bank offers an EMI holiday or restructuring. Don’t panic and try to foreclose the loan and block your liquidity. Managing debt in these times is more about managing temperament.
3. Build a real emergency fund - If you are scared, it’s a signal to start accumulating 6 to 12 months of monthly expenses in liquidity (not in stocks or MFs). In a layoff, you cannot afford to sell equity when markets are down or wait for redemption cycles. Cash needs to be cash, and it needs to be there from day 1.
3. Get your own health and term insurance - Corporate cover ends the day you leave. Buying a policy afterwards is harder because pre-existing conditions come with 2 to 4 year waiting periods, and anything diagnosed during a coverage gap may be excluded entirely. If you can afford to pre-pay the premium for the next 2-3 years, it’s practically a good choice to make.
5. Do not touch long-term money first - EPF, PPF, retirement funds, and long-term equity are the last resort, not the first. Every rupee pulled out of a compounding bucket costs you more
6. Talk with your family - If you are single-income, it will definitely get tougher. The most important thing is to align your partner and family on what the next 4-6 months without a salary would actually look like. A few important things like school fees and healthcare for an elderly parent will be the priority. Expenses like house help, big purchases need to be moderated or wait for some time.
7. Do not make big money decisions in the first 30 days (if layoff happens) - Panic and time pressure hit at the same time, which is exactly when the worst decisions get made. Don’t Hate-Sell your vested RSUs at whatever price is showing that week, don’t take personal loans to build artificial liquidity, don’t sign exit paperwork without reading, don’t accept the first job offer at 20% less than fair.
8. Negotiate the severance package (if layoff happens) - The layoff decision is fixed, but the package usually is not. You can often push for a longer notice period and most people accept whatever HR offers on the first call. Even a polite email asking for specifics can change the numbers.
9. Don’t fall for the herd - During these times, it’s natural for folks to form groups and get on a hate-train and lose yourself in the noise. Take some time to accept the pain and try finding avenues that help you get your career back on track.
These suggestions may seem simple or obvious, but not many people actually sit down to plan for a worst-case situation, because no one wants to see it coming.
