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Whether you’re Joe Torre or Joe Cubicle, your at-will (more aptly, fire-at-will) contract may come to an end unexpectedly. If you’re smart, you may have seen the writing on the wall and given yourself time to prepare. Life isn’t always that obvious, so you should be thinking ahead and protecting yourself. Here are some tips that you can start putting into effect now, particularly if you are not the sole controller of your employment destiny.

Keep three to six months in accessible funds. The term “emergency fund” is outdated. Keeping a large portion of your emergency money in cash-like vehicles like high-yield money market funds was a decent plan when you were able to get interest rates above and beyond 5%. Nowadays, savings accounts are not the best options, but you still need to consider the possibility of not finding a job — at least, not at your desired salary — for a long time.

The money you use in an emergency — when you have no income coming in — can be a mix of the following:

• Cold hard cash (a few days’ expenses). Only keep enough cash on hand for emergencies to hold you over until you can get more out from the bank.
• Highly liquid savings or money market account (expenses for one week to a few months). If you can use your ATM card to get this cash, then you shouldn’t have any problems. As you can see from the the latest savings account rates, you’re not earning much on this money, so keep the balance low. With the Fed poised to lower the target federal funds rate this week, you can be sure banks will drop their interest rates even further.
• Roth IRA (the current year’s contribution). You can liquidate and withdraw any amount you’ve invested in your Roth IRA without any taxes or penalties. If you do so, you will give up any anticipated earnings (or losses) on that money. You can refund your Roth IRA once you are no longer in an emergency up to that particular year’s maximum contribution as long as it is before April 15 of the following year.
• Credit. If you have good credit, and if you normally manage credit well, you can get by with using a credit card to pay for some expenses. This can be dangerous and is not advisable for most. If credit is your main form of emergency fund, an unexpected hospital bill during an unexpected unemployment stint could present expenses that will cost you a fortune for years thanks to interest charges.

Mix and match the above keeping in mind what works best for you. If some of the other preparations are in good standing, you won’t have to use much of your emergency money if any.

Keep your resume and portfolio current. While your resume should be tailored to any position for which you apply, you should have a basic resume off of which you build your specialized documents. Review your basic resume and update it with your current responsibilities. Any time you work on a new, significant project, complete a task that is worthwhile for the company, assume new responsibilities, or receive a promotion, update your basic resume. Have it ready to go.

In the arts or in teaching, a current portfolio may often be the key to the next job. My girlfriend keeps a folder with some of the more impressive lesson plans and projects, as well as students’ work. While I was looking for a teaching job, I kept a portfolio that included music arrangements and videos of my instruction and ensemble performances. Artists certainly need to keep copies of recent work.

Rather than scrambling at the last minute to gather all these materials, simply keep updating your folders as you progress. I’m forgetful, so if you’re like me, schedule reviews on your calendar to remind you to take a few minutes to make the additions.

Always be networking. This doesn’t mean just going out after work with your boss whenever invited. Make friends in other departments and see as many people as possible related to your career goals. Always carry your business card. If your company doesn’t provide you with your own, make them yourself. If you create your own, keep yourself open to different avenues by not including any specific job title on your card. Include your name, basic contact information, and if you feel someone needs a reminder of who you are, jot a note on the card before you hand it to someone.

I’m not going to get into the details of networking as the topic deserves its own article, book, or series of books. I’ve never been great at networking; Myers-Briggs classifies me as split between an I (introvert) or an E (extrovert) — I’m an introvert among strangers and an extrovert among friends. Pure extroverts make the best networkers.

Get recommendations without asking. Part of my previous job at my current company was working with clients while planning official company events. I was not in the event planning department, but I found myself doing this work outside of my job description anyway. I’ve received thank you notes from other company’s CEOs as well as from senior executives from within my company. I’ve filed these away into a folder for any future needs. Personal notes from famous names and organization may help me someday.

Any recommendations you receive from your employers should go in this file as well.

Study your industry. There are two parts to this. First, you must make sure your knowledge is always current, especially if you are in a field like technology, where frequent advancements in the industry may change the way you operate. Take classes on the latest issues, even if they are not paid for or supported by your employer. If your field is more stagnant than software for example, then broaden your knowledge by learning about related topics.

Second, always know what the market is like in your industry. Are your target companies in hiring mode, offering fresh graduates bonuses or high salaries to attract new, young, malleable talent, or are job openings at an all-time low? Is some other city becoming the worldwide hub in your industry? These are the things you can learn by talking to people involved in hiring, reading industry magazines, newsletters, and even internet forums, and looking at job postings frequently.

Here’s a summary of the above:

• Keep three to six months in accessible funds.
• Keep your resume and portfolio current.
• Always be networking.
• Get recommendations without asking.
• Study your industry.

Following these suggestions, you will likely be able to better handle an unexpected job loss psychologically and financially. If you’re always prepared, you should be able to find a new position relatively quickly. The quicker you are, the less you have to dip into your savings to pay expenses.

I don’t have all the answers. Almost definitely there are other great suggestions for preparedness just waiting to be shared. Please feel free to leave some comments if you have other ideas or if you disagree with my thoughts.

This article was updated on October 31 to clarify wording regarding 401(k) withdrawals.

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