July 31, 2023 • 32 mins
Layoffs, unfortunately, have become a common occurrence in today's ever-changing job market.
It's a tough pill to swallow, but you don't have to let it happen to you without a plan. You hold the power to take control of your situation and safeguard the future for yourself and your loved ones.
In this episode, we're going to discuss practical steps you can take to bounce back and thrive after a layoff. We're talking about more than just weathering the storm; we're discussing how you can transform adversity into a springboard for personal and professional growth.
Get ready to rise above the challenges and embrace the limitless potential that awaits you. This is an episode you won't want to miss!
IN TODAY’S EPISODE, I DISCUSS:
- How to increase your value in an organization
- The financial and psychological challenges faced during layoffs
- Framework and process for preparing and navigating potential layoffs
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- How to Quit Your Job & Build a Profitable Business
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Mel Abraham (00:00):
It's time to apprise against the downsides.
(00:02):
Listen, some of you have reachedout to me say what do I do?
Because I'm afraid of being laidoff. How do I prepare myself?
What do I need to do? Well, inthis episode we're going to talk
through, we're going to walkthrough this whole thing of,
what do you need to do toprepare? If a recession hits if
you might lose your job? And howdo you protect yourself? How do
(00:23):
you protect your family'sfuture? So welcome to this
episode of affluent EntrepreneurShow. Let's get this one dialed
in. So you feel comfortable, youfeel guided, and you feel
supported on this journey, nomatter what happens. I'll see
you in the episode. Cheers. Thisis the affluent Entrepreneur
Show for entrepreneurs that wantto operate at a high level and
achieve financial liberation.
I'm your host, Mel Abraham, andI'll be sharing with you what it
(00:45):
takes to create success beyondwealth. So you can have a
richer, more fulfillinglifestyle. In this show, you'll
learn how business and moneyintersect. So you can scale your
business, scale your money, andscale your life while creating a
deeper impact and living withcomplete freedom. Because that's
what it really means to be anaffluent entrepreneur.
(01:13):
Welcome to this episode, theaffluent entrepreneur show this
one I want to talk about tough,tough topic. All right. And that
is for those people that maybefeel like I might, I might get
laid off. Let's face it. Intoday's time, there's a lot of
talk about uncertainty. There'sa lot of layoffs. I know that
(01:33):
Facebook just laid off another10,000 people, there's other
companies that have announcedlayoffs, Amazon, Google and, and
a lot of tech companies. Sothere's a lot of people facing
this idea of being laid off, andwhat do they need to do? How do
you protect yourself? What doesthat look like? And And are
there things to do? And? And theanswer, the short answer is,
(01:54):
yeah, there's things to do.
There's things that you can donow, one of the things I want to
be really careful about in thisepisode, is it's really easy for
you to look at your life andsay, I should have, I could have
should have saved more I shouldhave put more money away, I
should have listened to Mao, Ishould have had that peace of
mind what I should have done, Ishould have I should have a
shoe, it'd be honest with you,whatever you should have done.
(02:17):
It's just, it's just not goingto help. The question is, what
are you going to do now? There'sa lot of things in my life that
I should have done. And is thereregret? Certainly. Do I kick
myself? Absolutely. I'm human.
Do I live in it? No. Okay, now Idon't. Because when we live in
(02:44):
it, we can't move out out fromit. So as we go through this,
you can wish it were different.
But that doesn't change thefacts. So let's work with what
we have. And I promise you, I'mhere for you to support you help
you and guide you along the way.
So God forbid this, this happensdown the road or happens again.
(03:08):
You're better prepared. Youknow, I watched my wife. She
spent 22 years she came out ofcollege and she went to work for
a company 22 years with the samecompany 22 years, dedicated,
traveled the country doing thework. She she won awards,
President's Club awards,multiple ones she ran team, she
(03:30):
was really really amazing whatshe does. Now I'm not saying
that just because she's my wife.
She is truly an amazing leader,an amazing executive at the
stuff that she does, but 22years with a company. And she
survived four or five priorlayoffs. But the I don't
(03:52):
remember was the fifth or sixthone got her. She got laid off
along with 2000 people. And hereshe was without job and
everything. And one of thethings to realize is that
there's a financial aspect toit. We'll talk about the
financial aspects. Man, there isa there's a psychological aspect
(04:14):
to it. There's an esteem aspectand worthiness aspect, and she
struggled with it. You know, I Inever had to deal with it.
Because I've been self employedfor so long. That, you know, I
am my own boss. And you know, myboss can fire me anytime but I'm
(04:37):
coming back. So, but I watchedher struggle with it
psychologically, we didn'tstruggle with it financially
because of some of the thingsI'm going to talk about here.
But I don't It's not lost on methat the threat of this on a
family on an individual is fargreater than just sight the
financial side of it, there is apsychological emotional side to
(05:00):
it, just to say, so I'll try tohit on some of that. But I want
to prepare you financially forit. Because if you're better
prepared financially, it'seasier to navigate the
psychological and emotionalelements of it. Okay, so this is
where I want to come from. Now,why is this so important? Well,
(05:21):
just looking at statistics,okay, just looking at statistics
right now, there has been 15point 4 million layoffs in the
US 15 point 4 million layoffs6.9 million between August and
December of 2022. Okay, soyou're talking about a handful
(05:41):
of months, where they had almosthalf the layoffs, 7 million
layoffs. 48% of the people in astudy said they had what they
called layoff anxiety, okay. 47%of employees feel completely
unprepared for any kind oflayoff. Wow, we're going to try
(06:06):
and fix that in this episode,and 30% of those over 55,
completely unprepared. Now,that's actually a more dramatic
statistic. Because at 55, younow have to deal with trying to
get a job at a higher age, whichsometimes proves difficult. I
don't know why it should,because a 55 year old has a
(06:28):
tremendous amount of wisdom andknowledge and experience that
they bring to a job. Now in somecases, they say you're
overqualified. Some cases, theysay you're under qualified
because you didn't keep up withthe trends. We'll talk about
some of that. But my point is,is that the data shows that
there's plenty of layoffs goingon. The data shows that, that in
many cases, you'll be subject toone, at least in your lifetime.
(06:52):
So what's the best way tonavigate it, I'm going to talk
about a framework and a processthat I would have you look at.
And like I said, again, as wewalk through this, this isn't
about you judging yourself, Iwish I would have done it, I
wish you would have done, I needyou to start now. Wherever
you're at with whatever youhave, we need to start now.
Because if the layoff happens,you're better prepared. If the
(07:17):
layoff doesn't happen, you'rebetter prepared for a
financially free future. So it'san absolute win, no matter what
happens. Let's just look atthis, this framework as as we
move forward. And that firstframework, the first piece is
this, I need you to startunderstanding and looking at
your expenses. This is a time toget very critical about your
(07:40):
expense review. In other words,I want you to get your credit
card statements, I want you toget your checking account
statements, I want you to lookat every category. Now I'm not
telling you to cross it out yet.
But I want you to categorizethose things that our wants. And
those things that our needs. Theneeds are for your survival.
(08:03):
They're the roof over your head.
They're they're the food in yourstomach, they are your health
care, their medical, theclothing, the transportation,
they're your survival, thebottom level of the Maslow's
hierarchy of needs. They're notthe luxury items, they're not
the the other things, theNetflix, the mani pedi is the
(08:24):
technology all that stuff, thoseare wants, and it's totally fine
to have a bunch of wants. But ina time, where you need to be
critical with every singledollars, why we use cash
resource planning, with ourclients with my elite, my
master's in the affluenceblueprint is to make sure that
(08:44):
every dollar has the proper jobdescription to do the right
things to make sure that youfind your path to financial
freedom, the the most effective,efficient way possible. And so
it's in these times that youstart to look at all the needs
and say these are the thingsthat I need survival. These are
the things that I want. And nowyou look at the ones and say, Do
(09:06):
I still want them? Or is it justin case? I wanted them a month
ago, six months ago, a year ago?
And now I'm still paying for it.
It's a time to stopsubscriptions. Is it time to
change some things? Is it timeto call your cable company and
negotiate? Trust me everythingis negotiable. Okay, to call and
(09:27):
ask for a better fee. Otherwiseyou might change to do some
things to save you money. Thisis the time to do it is to I
want you to review every singledollar that goes out and look
for places to find additionalcash by eliminating by changing
(09:48):
by negotiating by mediating bydoing some things to bring some
additional cash to you in thesense of not sending it out not
paying the bills that you don'tneed to pay by stopping it.
Okay. Hey, I actually do anannual expense review, as I do
my tax planning for the end ofthe year, and I'm looking
towards the next year, I do anannual expense review. And I
(10:08):
see, am I still using thesoftware? Am I still using the
subscriptions? Do I need them?
Does it make sense? Or I want tocancel? Do I want to renegotiate
them? Now, here's the thing, Iwant you to take whatever
savings you come up with, Idon't want you to go spending it
somewhere else. I want you totake that savings and I want you
to transfer it automaticallyevery month. So you're still
(10:31):
putting the money out same moneyout but it's coming back to you
wanted in a high yield cashaccount, high yield cash account
only. That's a savings accountthat's separate apart from your
check again, if it's in yourchecking account, the temptation
is to spend it, it's there I canspend it nope, take it out of
the checking account, put it ina high yield cash account. High
yield cash account is going toget you about four and a half
(10:53):
percent right now maybe 5% rightout depending where it's at
three characteristics of a highyield cash County, it must be
100% insured specially after thebanking crisis are watching some
of these banks fields 100%insured. Now there are some
places like where I have my highyield cash account is there
insured up to 3 million bucks.
(11:15):
Okay. But I want 100% insured, Iwant it 100% liquid so so
meaning that I can get access tothe cash within 24 hours. I
don't have to wait weeks, it'snot locked up from once it's not
locked up for a year, I can getaccess to 100% Liquid number
number three, there are no feesor expenses, they are not going
(11:37):
to charge you to have hold ofyour money. So insured, no fees
and fully liquid. That's it. SoI want to move that into a high
yield cash cow any savings youhave goes in Ohio cash cow
because that leads to numbertwo. Number two is about
increasing liquidity. The moreliquidity you have access to
(12:00):
cash to sustain yourself shouldyou get laid off, the better off
you will be. Okay. This is whywe people will call it an
emergency fund, you know as partof the wealth priority ladder
that we teach our our elitecenter masters in our affluence
blueprint, we talk about thewealth prior priority ladder.
And at the at the base level, wetalk about a comfort fund. But
(12:21):
more importantly, we want to getyou into what we call a peace of
mind fund. Some people call itemergency fund, I want you to
have nine to 18 months dependingon your search situation, nine
to 18 months worth of cashavailable to you in a high yield
cash cow. Okay? You may not bethere right now, you may not
(12:41):
even get there for a littlewhile. But I need that in your
head. Because the more liquidityyou have, the more you can
navigate the downturn and notcompromise your values, not
compromise getting a job thatyou don't necessarily want. It
gives you a little morebreathing with your oxygen
during a downturn. Now, youmight say well, now I wish I
would have done this before yourright would have been any time
(13:03):
investing savings and buildingwealth is always better done
years ago. But we're here today.
So we start today. It's okay.
I'm okay with it. All right. Soincrease your liquidity. Number
three, I want you just start tolook at your income options.
There are things that you can dothat you have strengths, you
(13:26):
have talents, you have skills,and sit back and say what can I
do to increase my income. Theother thing that can happen even
though your organization yourcompany might be looking at at a
possible layoff that you can goin and say how can I increase my
(13:46):
value? So I'm in disposable tothe organization. Too often we
think that we should get paidand compensated based on time
served, whether you're sellinghours for dollars, or you spent
time in employment. You know,I'm sorry, this is gonna be hard
for some people to hear. Butjust because you've been
(14:07):
employed for with a company fora decade doesn't entitle you to
more compensation. We are in avalue exchange economy. What
entitles you to morecompensation is to solve bigger
problems and provide more value.
They will pay for that. Theywill keep you on board for that.
So what problems can you solvethat others aren't solving? How
much can you create more valuethat other people aren't
(14:28):
creating? Because that gives youincome options and it gives you
staying power? Okay, hopefullythat makes sense. That leads to
then taking those income optionsto the skills and the things
that you have and start to lookat okay. Are there side hustles
or gigs that I can do with mytown skills and strengths that
(14:49):
can bring in more income becausehere's why this is important. If
you have multiple sources ofincome and I have been I've said
this for a while Having multiplestreams of income is no longer a
luxury. It is a requirement. Ifyou truly want to be financially
free, financially secure,financially independent, you
(15:09):
cannot be dependent on a singlestream of income, whether that
single straight stream of incomeis your salary, your business,
it doesn't matter. So what Iwant you to do is start looking
at how you create additionalstreams of income in your world,
that then makes you lessdependent on a single stream of
income. So if, if God forbid,they give you a severance
(15:31):
package and say, We're debt,we're downsizing, and we're
letting you go, you still havesome income to supplement
yourself, you're not, you didn'tgo from something to zero, you
went to something and somethingabove zero. That's the thing
that we need to look at. Now,that leads me to this, this
other piece, which I mentionedalready. And that is, I want you
to focus on value versus income,the more you can increase your
(15:55):
value in the eyes of the peopleyou serve. The higher they're
willing to pay you, the morethey're willing to stay with
you, the more they're willing tokeep you on board because they
look at you and go, This personis creating a ton of value. One
of the things that I did when Iwas at the big consulting firm
in downtown Los Angeles, okay, Ihad the opportunity I was on
(16:18):
fast track a partnership, beforeI left there, I had the
opportunity to do things thatother people didn't. And the
only reason I was given theopportunity, and why it was
growing so fast. And my salarywas going so fast was because I
was I was that person, that whena job came up a project came up,
that was unusual that otherpeople didn't want to take on or
(16:40):
they were unsure of how totackle it. I said give it to me.
So I was solving problems thatother people weren't willing to
solve or didn't understand howto solve it weren't willing to
tackle it. I said, No, no, justgive it to me, I'll figure this
thing out. And it's kind of Ihave been known as a problem.
I'm a fixer as my wife says I, Ifixed problems for people on and
(17:00):
everything. But the point beingis that what that did is it made
me much more valuable to thefirm to the company, then other
people, which kept me on board,which got my salary increased
more readily. And when it camedown to potential downsizing,
they said, Mel is more of autility player and he's gotten
more value compared to tosomeone so so we're gonna let
(17:24):
someone so go, we're gonna keepMel. Okay, that's what I want
for you. The way you do that isto look at how do you increase
your value in the marketplace,in your employment, and the
things that you bring to thetable, that's going to be skill
development, it's going to beexecution, that's going to be
communication, that's going tobe doing things that are out of
(17:44):
the norm of your job descriptionto set yourself apart. Hey,
understand, then the last pieceof this is that a little adds up
to a lot. Okay, all you'relooking for is just a little bit
of breathing room, just a littlebit of something that's going to
(18:06):
carry you through, okay, whenyou have that, that's what's
going to allow you the latitude,and the ability and the oxygen
to breathe. Okay. Now, let's saythat you do all of this stuff,
and you still get laid off. Sowhat I want to do is walk you
(18:27):
through some things to consider.
There are 12 things I want youto consider. If God forbid you
were laid off. So the firstthing is to understand this, if
you're laid off, I want you toget a layoff letter in writing.
Okay? I want it in writing. Soyou have it documented and you
you can get the rationale forthe layoff and all that stuff.
(18:51):
Because if you go to anotheremployee, employer, potentially
you want to make sure that theyare clear that this was a mass
layoff and it wasn't because ofperformance. It wasn't because
of something you did, and you'llhave that layoff letter that can
do it. Now, I want you to lookat the letter, the terms and
what they say in there, and Iwant you to be clear and protect
(19:12):
yourself. Then, the second pieceof this is I want you to
negotiate your severance,everything's negotiable. They're
laying you off anyways, youmight as well ask, and the
higher the value you are to theorganization, the better
negotiating power you have iethey may still lay you off
(19:34):
because even though your Higher,higher valid, but they will feel
more apt to try and take care ofyou or do some of these things.
Number three, as hard as it is,I want you to file for
unemployment. It takes a whileto get this thing in play and
get things in in a processbecause I want cash coming in.
In addition to whatever you haveset aside to give you a little
(19:57):
more room to breathe, because,like I said, something like this
happens, it's emotional. Sofiling for employment is
important because it's going togive you some cash coming in.
And that cash coming in is goingto give you a little bit of
oxygen, because there's going tobe a time where it's emotional,
you're going to feel bad, you'regonna feel horrible, you're
(20:18):
gonna blame yourself, you'regonna look at things you did. It
doesn't serve you but we stillhave to navigate through it, we
have to move through it. And themore we have cash coming in
alongside with the the cash youput aside, it will be much
better for you, in the long runto give you that now, have a
plan. This is important. Have aplan for your health insurance,
what's going to happen when yourbenefits your health insurance.
(20:40):
Listen, here's the interestingthing. When Stephanie got laid
off, right before I gotdiagnosed with the cancer, now
our health insurance was throughher company. And what we decided
to do, and I don't know why wedid this, we decided to take on
the cobra, which was expensivewas like a couple grand a month,
(21:02):
we took on the Cobra to keep thegood insurance that we had.
Thank God we did. Because acouple months after that I got
diagnosed with the cancer. And Ihad the opportunity to get the
team of doctors in place tocover me having a plan for your
health insurance, your family'shealth, health insurance in this
transition period is huge. Aspart of the negotiation with
(21:23):
your severance, make sure thatyou have it dialed in II know
what you're going to do to makesure that you guys are covered,
more bankruptcies are createdthrough medical bills than any
other reasons. So I don't wantthat to be you make sure that
you're you're thinking aboutyour medical insurance, if this
comes into play, ask for thenumber five is to ask for a
(21:45):
reference or feedback. And whatI would also do along with this,
the reference or feedback isnurture your context. And you
actually the problem is thatmost people will wait till they
get laid off. To nurture theconscious, we should stay in
contact with our industrysources and the people that we
want to work with on an ongoingbasis. So when it comes time, or
(22:07):
if it comes time, you start tolook at contact him and it's not
out of the blue, you've alreadyhad conversations with them. So
nurture those contacts. Numberseven, look at your 401 K
options, let me be really clearhere. Your 401k options, this is
(22:29):
dried out because that one stopsyour financial freedom growth,
two is going to trigger attacks,three is going to trigger a
penalty, you will end up with 50cents on the dollar, it is the
absolute last dire need lastdying breath, you're gonna pull
that money out, okay, you'regonna leave the money in the 401
(22:51):
K to grow, you're gonna findanother way to make it work, if
you can. Now, when I say reviewyour 401 K options, they're may,
they may require you to to rollit out to an IRA, which you can,
they may not require you to rollit out to an IRA, which you
don't have to. But a 401 K at acompany that you're not at, you
(23:11):
got to look at the costsassociated with it. Because if
there's a lot of fees in there,then maybe you're better off
rolling it out to a four two toan IRA. Because then you have
lower fees, too. If you don'thave a lot of investing options
in that 401k rolling it out toan IRA gets you more investing
options. Now you don't need todo that right away, they'll give
(23:32):
you the timeframe to do it.
Because if you got employed withanother company that had a 401
K, you might actually be able toroll that to the company's 401k
If they have good options andlow fees. But point being is you
have latitude to do some thingswith your 401 K or your
retirement at that company.
without triggering tax withouttriggering penalties and giving
(23:52):
you the more offer more optionsand lower lower costs. You may
need someone to look at it withyou and help you with that. But
know that you're not required toleave it there. And in some
cases, you are required to takeit but you're not required to
leave it there and you haveoptions. Look at those options
before you make a big move.
(24:15):
Okay. Number eight. I just wantyou know, it's interesting. I
want you to create a brag book.
What have you accomplished? Howhave you accomplished it? What
are the keys what are the thingsa brag book, this isn't about
ego. This is about youunderstanding and valuing the
things that you haveaccomplished for the people that
you have served. Create a BrandBook. So when it comes down to
(24:36):
interviewing you may not begiving them the brag book, but
it's it's re enforcing the valueyou're bringing to the table of
a new employer a new job, a newendeavor, if you will, too
often. We remember all thenegative stuff the stuff that
isn't good. It's maybe we needto remember some of the good
(24:57):
stuff that we've done in a longcareer, we tend to forget. So we
ought to be building this bragbook all along. Okay, recognize
the things that you do. Numbernine. Number nine, is checking
with yourself. This one's a bigone. How are you feeling? What
(25:20):
are the emotions going on? Theremight be anger, there might be
resentment. There might be fear,it might be all of the above.
It's okay. It's okay. Don'tinvalidate them. You're gonna go
through a mourning process. Wejust don't want to live in the
(25:43):
mourning process. And away, wedon't live in the mourning
process as we start to do a fewthings for ourselves, do some
things for yourself. Maybe youjust need a weekend to chill.
Maybe you need a spa day. Maybeyou need to go for a run. What
things can you do for yourselfthat you know are gonna make you
(26:04):
feel good? Make you feelempowered, get you to feel
better? To get you moredirected, more focus? What are
the things that you can do foryourself? Ask for support. Ask
for people that that can helpyou. Look, no one's gonna judge
you. I certainly wouldn't have afeel for you. You know, a lot of
(26:28):
these laughs It's not it's notanyone's fault. So don't blame
yourself, don't beat yourselfup. Now, at the same time, I
want you to think about how canyou skill up to value up? Are
there skills that you canacquire pretty quickly or that
you should have acquired toincrease your value. So when you
(26:51):
go to another interview, oranother endeavor or another job,
you have more value to offer?
The more remember, we're in avalue exchange economy skill up
to value up when you skill up tovalue up your values up, you
become more in demand you morebecome more desirable, more
hireable, more, more of whatthey want. And then the last
(27:16):
thing in this, no matter what,just remember, it's not
personal. It feels it. Trust me,it feels it. But it's not
personal. They made a businessdecision. When they laid off
2000 People from what when mywife was part of that they
weren't specifically looking atStephanie and going, Yeah, your
(27:36):
God. I mean, they did, but waspart of a 2000 person group. It
wasn't personal againstStephanie, they made a business
decision. Now, here's theinteresting thing, she's in a
far better place, doing farbigger things, making far more
money and being far morefulfilled.
(27:57):
So in the end, it was better nowgoing through, certainly wasn't
great. But remember, isn'tpersonal. So with that, I kind
of start to look at this. Therewith uncertainty in the economy,
with people trying to tighten upwith rising interest rates,
there is a potential for morelayoffs. I don't know if it's
(28:20):
going to happen. And it dependson the industry, the geography,
the company, but it couldhappen. Hopefully, I've given
you a little bit of a recipe toprepare yourself that if it does
happen, you're in better place.
But it is also a recipe that ifit doesn't happen, you're in a
better place. It starts you onthis journey to financial
(28:42):
freedom up the wealth priorityladder, to move to a place where
you should be. And where I wantyou to be is where you are in a
place where you are workoptional, that you get a chance
to decide and have choice andthat you're working because you
want to not because you need.
You're working for you theimpact and the legacy you're
(29:06):
creating, and not the billsyou're paying. And so
ultimately, that's where I wantyou to be. It may take some
steps and some time to get youthere. But we'll get you there
if you stay on the journey. Andknow that you're not on this
journey alone, no matter whathappens. I'm here for you. I'm
here to help. I'm here to guideyou as best I can. If you have
(29:27):
questions you can come to me andask Mel now.com Leave me your
questions. I'll bring it on anepisode or I might even bring
you on have the conversation.
The key is this. I want you tobe on the journey towards
financial freedom. No matter howdistant it may feel today. It
will get closer if we start onthe journey today. And know that
every step of the way. You're inthis journey with someone who
(29:52):
cares in this process. Alright,I look forward to seeing you on
the journey. I look forward toseeing you grow I look forward
to seeing you soar and until wesee each other again on another
episode or another show, or outon the road. Always, always
strive to live a life thatCheers. Thank you for listening
to the affluent entrepreneurshow with me your host Mel
(30:13):
Abraham. If you want to achievefinancial liberation to create
an affluent lifestyle, join mein the affluent entrepreneur
Facebook group now by going tomelabraham.com/group, and I'll
see you there.
It's time to apprise against the downsides.
(00:02):
Listen, some of you have reachedout to me say what do I do?
Because I'm afraid of being laidoff. How do I prepare myself?
What do I need to do? Well, inthis episode we're going to talk
through, we're going to walkthrough this whole thing of,
what do you need to do toprepare? If a recession hits if
you might lose your job? And howdo you protect yourself? How do
(00:23):
you protect your family'sfuture? So welcome to this
episode of affluent EntrepreneurShow. Let's get this one dialed
in. So you feel comfortable, youfeel guided, and you feel
supported on this journey, nomatter what happens. I'll see
you in the episode. Cheers. Thisis the affluent Entrepreneur
Show for entrepreneurs that wantto operate at a high level and
achieve financial liberation.
I'm your host, Mel Abraham, andI'll be sharing with you what it
(00:45):
takes to create success beyondwealth. So you can have a
richer, more fulfillinglifestyle. In this show, you'll
learn how business and moneyintersect. So you can scale your
business, scale your money, andscale your life while creating a
deeper impact and living withcomplete freedom. Because that's
what it really means to be anaffluent entrepreneur.
(01:13):
Welcome to this episode, theaffluent entrepreneur show this
one I want to talk about tough,tough topic. All right. And that
is for those people that maybefeel like I might, I might get
laid off. Let's face it. Intoday's time, there's a lot of
talk about uncertainty. There'sa lot of layoffs. I know that
(01:33):
Facebook just laid off another10,000 people, there's other
companies that have announcedlayoffs, Amazon, Google and, and
a lot of tech companies. Sothere's a lot of people facing
this idea of being laid off, andwhat do they need to do? How do
you protect yourself? What doesthat look like? And And are
there things to do? And? And theanswer, the short answer is,
(01:54):
yeah, there's things to do.
There's things that you can donow, one of the things I want to
be really careful about in thisepisode, is it's really easy for
you to look at your life andsay, I should have, I could have
should have saved more I shouldhave put more money away, I
should have listened to Mao, Ishould have had that peace of
mind what I should have done, Ishould have I should have a
shoe, it'd be honest with you,whatever you should have done.
(02:17):
It's just, it's just not goingto help. The question is, what
are you going to do now? There'sa lot of things in my life that
I should have done. And is thereregret? Certainly. Do I kick
myself? Absolutely. I'm human.
Do I live in it? No. Okay, now Idon't. Because when we live in
(02:44):
it, we can't move out out fromit. So as we go through this,
you can wish it were different.
But that doesn't change thefacts. So let's work with what
we have. And I promise you, I'mhere for you to support you help
you and guide you along the way.
So God forbid this, this happensdown the road or happens again.
(03:08):
You're better prepared. Youknow, I watched my wife. She
spent 22 years she came out ofcollege and she went to work for
a company 22 years with the samecompany 22 years, dedicated,
traveled the country doing thework. She she won awards,
President's Club awards,multiple ones she ran team, she
(03:30):
was really really amazing whatshe does. Now I'm not saying
that just because she's my wife.
She is truly an amazing leader,an amazing executive at the
stuff that she does, but 22years with a company. And she
survived four or five priorlayoffs. But the I don't
(03:52):
remember was the fifth or sixthone got her. She got laid off
along with 2000 people. And hereshe was without job and
everything. And one of thethings to realize is that
there's a financial aspect toit. We'll talk about the
financial aspects. Man, there isa there's a psychological aspect
(04:14):
to it. There's an esteem aspectand worthiness aspect, and she
struggled with it. You know, I Inever had to deal with it.
Because I've been self employedfor so long. That, you know, I
am my own boss. And you know, myboss can fire me anytime but I'm
(04:37):
coming back. So, but I watchedher struggle with it
psychologically, we didn'tstruggle with it financially
because of some of the thingsI'm going to talk about here.
But I don't It's not lost on methat the threat of this on a
family on an individual is fargreater than just sight the
financial side of it, there is apsychological emotional side to
(05:00):
it, just to say, so I'll try tohit on some of that. But I want
to prepare you financially forit. Because if you're better
prepared financially, it'seasier to navigate the
psychological and emotionalelements of it. Okay, so this is
where I want to come from. Now,why is this so important? Well,
(05:21):
just looking at statistics,okay, just looking at statistics
right now, there has been 15point 4 million layoffs in the
US 15 point 4 million layoffs6.9 million between August and
December of 2022. Okay, soyou're talking about a handful
(05:41):
of months, where they had almosthalf the layoffs, 7 million
layoffs. 48% of the people in astudy said they had what they
called layoff anxiety, okay. 47%of employees feel completely
unprepared for any kind oflayoff. Wow, we're going to try
(06:06):
and fix that in this episode,and 30% of those over 55,
completely unprepared. Now,that's actually a more dramatic
statistic. Because at 55, younow have to deal with trying to
get a job at a higher age, whichsometimes proves difficult. I
don't know why it should,because a 55 year old has a
(06:28):
tremendous amount of wisdom andknowledge and experience that
they bring to a job. Now in somecases, they say you're
overqualified. Some cases, theysay you're under qualified
because you didn't keep up withthe trends. We'll talk about
some of that. But my point is,is that the data shows that
there's plenty of layoffs goingon. The data shows that, that in
many cases, you'll be subject toone, at least in your lifetime.
(06:52):
So what's the best way tonavigate it, I'm going to talk
about a framework and a processthat I would have you look at.
And like I said, again, as wewalk through this, this isn't
about you judging yourself, Iwish I would have done it, I
wish you would have done, I needyou to start now. Wherever
you're at with whatever youhave, we need to start now.
Because if the layoff happens,you're better prepared. If the
(07:17):
layoff doesn't happen, you'rebetter prepared for a
financially free future. So it'san absolute win, no matter what
happens. Let's just look atthis, this framework as as we
move forward. And that firstframework, the first piece is
this, I need you to startunderstanding and looking at
your expenses. This is a time toget very critical about your
(07:40):
expense review. In other words,I want you to get your credit
card statements, I want you toget your checking account
statements, I want you to lookat every category. Now I'm not
telling you to cross it out yet.
But I want you to categorizethose things that our wants. And
those things that our needs. Theneeds are for your survival.
(08:03):
They're the roof over your head.
They're they're the food in yourstomach, they are your health
care, their medical, theclothing, the transportation,
they're your survival, thebottom level of the Maslow's
hierarchy of needs. They're notthe luxury items, they're not
the the other things, theNetflix, the mani pedi is the
(08:24):
technology all that stuff, thoseare wants, and it's totally fine
to have a bunch of wants. But ina time, where you need to be
critical with every singledollars, why we use cash
resource planning, with ourclients with my elite, my
master's in the affluenceblueprint is to make sure that
(08:44):
every dollar has the proper jobdescription to do the right
things to make sure that youfind your path to financial
freedom, the the most effective,efficient way possible. And so
it's in these times that youstart to look at all the needs
and say these are the thingsthat I need survival. These are
the things that I want. And nowyou look at the ones and say, Do
(09:06):
I still want them? Or is it justin case? I wanted them a month
ago, six months ago, a year ago?
And now I'm still paying for it.
It's a time to stopsubscriptions. Is it time to
change some things? Is it timeto call your cable company and
negotiate? Trust me everythingis negotiable. Okay, to call and
(09:27):
ask for a better fee. Otherwiseyou might change to do some
things to save you money. Thisis the time to do it is to I
want you to review every singledollar that goes out and look
for places to find additionalcash by eliminating by changing
(09:48):
by negotiating by mediating bydoing some things to bring some
additional cash to you in thesense of not sending it out not
paying the bills that you don'tneed to pay by stopping it.
Okay. Hey, I actually do anannual expense review, as I do
my tax planning for the end ofthe year, and I'm looking
towards the next year, I do anannual expense review. And I
(10:08):
see, am I still using thesoftware? Am I still using the
subscriptions? Do I need them?
Does it make sense? Or I want tocancel? Do I want to renegotiate
them? Now, here's the thing, Iwant you to take whatever
savings you come up with, Idon't want you to go spending it
somewhere else. I want you totake that savings and I want you
to transfer it automaticallyevery month. So you're still
(10:31):
putting the money out same moneyout but it's coming back to you
wanted in a high yield cashaccount, high yield cash account
only. That's a savings accountthat's separate apart from your
check again, if it's in yourchecking account, the temptation
is to spend it, it's there I canspend it nope, take it out of
the checking account, put it ina high yield cash account. High
yield cash account is going toget you about four and a half
(10:53):
percent right now maybe 5% rightout depending where it's at
three characteristics of a highyield cash County, it must be
100% insured specially after thebanking crisis are watching some
of these banks fields 100%insured. Now there are some
places like where I have my highyield cash account is there
insured up to 3 million bucks.
(11:15):
Okay. But I want 100% insured, Iwant it 100% liquid so so
meaning that I can get access tothe cash within 24 hours. I
don't have to wait weeks, it'snot locked up from once it's not
locked up for a year, I can getaccess to 100% Liquid number
number three, there are no feesor expenses, they are not going
(11:37):
to charge you to have hold ofyour money. So insured, no fees
and fully liquid. That's it. SoI want to move that into a high
yield cash cow any savings youhave goes in Ohio cash cow
because that leads to numbertwo. Number two is about
increasing liquidity. The moreliquidity you have access to
(12:00):
cash to sustain yourself shouldyou get laid off, the better off
you will be. Okay. This is whywe people will call it an
emergency fund, you know as partof the wealth priority ladder
that we teach our our elitecenter masters in our affluence
blueprint, we talk about thewealth prior priority ladder.
And at the at the base level, wetalk about a comfort fund. But
(12:21):
more importantly, we want to getyou into what we call a peace of
mind fund. Some people call itemergency fund, I want you to
have nine to 18 months dependingon your search situation, nine
to 18 months worth of cashavailable to you in a high yield
cash cow. Okay? You may not bethere right now, you may not
(12:41):
even get there for a littlewhile. But I need that in your
head. Because the more liquidityyou have, the more you can
navigate the downturn and notcompromise your values, not
compromise getting a job thatyou don't necessarily want. It
gives you a little morebreathing with your oxygen
during a downturn. Now, youmight say well, now I wish I
would have done this before yourright would have been any time
(13:03):
investing savings and buildingwealth is always better done
years ago. But we're here today.
So we start today. It's okay.
I'm okay with it. All right. Soincrease your liquidity. Number
three, I want you just start tolook at your income options.
There are things that you can dothat you have strengths, you
(13:26):
have talents, you have skills,and sit back and say what can I
do to increase my income. Theother thing that can happen even
though your organization yourcompany might be looking at at a
possible layoff that you can goin and say how can I increase my
(13:46):
value? So I'm in disposable tothe organization. Too often we
think that we should get paidand compensated based on time
served, whether you're sellinghours for dollars, or you spent
time in employment. You know,I'm sorry, this is gonna be hard
for some people to hear. Butjust because you've been
(14:07):
employed for with a company fora decade doesn't entitle you to
more compensation. We are in avalue exchange economy. What
entitles you to morecompensation is to solve bigger
problems and provide more value.
They will pay for that. Theywill keep you on board for that.
So what problems can you solvethat others aren't solving? How
much can you create more valuethat other people aren't
(14:28):
creating? Because that gives youincome options and it gives you
staying power? Okay, hopefullythat makes sense. That leads to
then taking those income optionsto the skills and the things
that you have and start to lookat okay. Are there side hustles
or gigs that I can do with mytown skills and strengths that
(14:49):
can bring in more income becausehere's why this is important. If
you have multiple sources ofincome and I have been I've said
this for a while Having multiplestreams of income is no longer a
luxury. It is a requirement. Ifyou truly want to be financially
free, financially secure,financially independent, you
(15:09):
cannot be dependent on a singlestream of income, whether that
single straight stream of incomeis your salary, your business,
it doesn't matter. So what Iwant you to do is start looking
at how you create additionalstreams of income in your world,
that then makes you lessdependent on a single stream of
income. So if, if God forbid,they give you a severance
(15:31):
package and say, We're debt,we're downsizing, and we're
letting you go, you still havesome income to supplement
yourself, you're not, you didn'tgo from something to zero, you
went to something and somethingabove zero. That's the thing
that we need to look at. Now,that leads me to this, this
other piece, which I mentionedalready. And that is, I want you
to focus on value versus income,the more you can increase your
(15:55):
value in the eyes of the peopleyou serve. The higher they're
willing to pay you, the morethey're willing to stay with
you, the more they're willing tokeep you on board because they
look at you and go, This personis creating a ton of value. One
of the things that I did when Iwas at the big consulting firm
in downtown Los Angeles, okay, Ihad the opportunity I was on
(16:18):
fast track a partnership, beforeI left there, I had the
opportunity to do things thatother people didn't. And the
only reason I was given theopportunity, and why it was
growing so fast. And my salarywas going so fast was because I
was I was that person, that whena job came up a project came up,
that was unusual that otherpeople didn't want to take on or
(16:40):
they were unsure of how totackle it. I said give it to me.
So I was solving problems thatother people weren't willing to
solve or didn't understand howto solve it weren't willing to
tackle it. I said, No, no, justgive it to me, I'll figure this
thing out. And it's kind of Ihave been known as a problem.
I'm a fixer as my wife says I, Ifixed problems for people on and
(17:00):
everything. But the point beingis that what that did is it made
me much more valuable to thefirm to the company, then other
people, which kept me on board,which got my salary increased
more readily. And when it camedown to potential downsizing,
they said, Mel is more of autility player and he's gotten
more value compared to tosomeone so so we're gonna let
(17:24):
someone so go, we're gonna keepMel. Okay, that's what I want
for you. The way you do that isto look at how do you increase
your value in the marketplace,in your employment, and the
things that you bring to thetable, that's going to be skill
development, it's going to beexecution, that's going to be
communication, that's going tobe doing things that are out of
(17:44):
the norm of your job descriptionto set yourself apart. Hey,
understand, then the last pieceof this is that a little adds up
to a lot. Okay, all you'relooking for is just a little bit
of breathing room, just a littlebit of something that's going to
(18:06):
carry you through, okay, whenyou have that, that's what's
going to allow you the latitude,and the ability and the oxygen
to breathe. Okay. Now, let's saythat you do all of this stuff,
and you still get laid off. Sowhat I want to do is walk you
(18:27):
through some things to consider.
There are 12 things I want youto consider. If God forbid you
were laid off. So the firstthing is to understand this, if
you're laid off, I want you toget a layoff letter in writing.
Okay? I want it in writing. Soyou have it documented and you
you can get the rationale forthe layoff and all that stuff.
(18:51):
Because if you go to anotheremployee, employer, potentially
you want to make sure that theyare clear that this was a mass
layoff and it wasn't because ofperformance. It wasn't because
of something you did, and you'llhave that layoff letter that can
do it. Now, I want you to lookat the letter, the terms and
what they say in there, and Iwant you to be clear and protect
(19:12):
yourself. Then, the second pieceof this is I want you to
negotiate your severance,everything's negotiable. They're
laying you off anyways, youmight as well ask, and the
higher the value you are to theorganization, the better
negotiating power you have iethey may still lay you off
(19:34):
because even though your Higher,higher valid, but they will feel
more apt to try and take care ofyou or do some of these things.
Number three, as hard as it is,I want you to file for
unemployment. It takes a whileto get this thing in play and
get things in in a processbecause I want cash coming in.
In addition to whatever you haveset aside to give you a little
(19:57):
more room to breathe, because,like I said, something like this
happens, it's emotional. Sofiling for employment is
important because it's going togive you some cash coming in.
And that cash coming in is goingto give you a little bit of
oxygen, because there's going tobe a time where it's emotional,
you're going to feel bad, you'regonna feel horrible, you're
(20:18):
gonna blame yourself, you'regonna look at things you did. It
doesn't serve you but we stillhave to navigate through it, we
have to move through it. And themore we have cash coming in
alongside with the the cash youput aside, it will be much
better for you, in the long runto give you that now, have a
plan. This is important. Have aplan for your health insurance,
what's going to happen when yourbenefits your health insurance.
(20:40):
Listen, here's the interestingthing. When Stephanie got laid
off, right before I gotdiagnosed with the cancer, now
our health insurance was throughher company. And what we decided
to do, and I don't know why wedid this, we decided to take on
the cobra, which was expensivewas like a couple grand a month,
(21:02):
we took on the Cobra to keep thegood insurance that we had.
Thank God we did. Because acouple months after that I got
diagnosed with the cancer. And Ihad the opportunity to get the
team of doctors in place tocover me having a plan for your
health insurance, your family'shealth, health insurance in this
transition period is huge. Aspart of the negotiation with
(21:23):
your severance, make sure thatyou have it dialed in II know
what you're going to do to makesure that you guys are covered,
more bankruptcies are createdthrough medical bills than any
other reasons. So I don't wantthat to be you make sure that
you're you're thinking aboutyour medical insurance, if this
comes into play, ask for thenumber five is to ask for a
(21:45):
reference or feedback. And whatI would also do along with this,
the reference or feedback isnurture your context. And you
actually the problem is thatmost people will wait till they
get laid off. To nurture theconscious, we should stay in
contact with our industrysources and the people that we
want to work with on an ongoingbasis. So when it comes time, or
(22:07):
if it comes time, you start tolook at contact him and it's not
out of the blue, you've alreadyhad conversations with them. So
nurture those contacts. Numberseven, look at your 401 K
options, let me be really clearhere. Your 401k options, this is
(22:29):
dried out because that one stopsyour financial freedom growth,
two is going to trigger attacks,three is going to trigger a
penalty, you will end up with 50cents on the dollar, it is the
absolute last dire need lastdying breath, you're gonna pull
that money out, okay, you'regonna leave the money in the 401
(22:51):
K to grow, you're gonna findanother way to make it work, if
you can. Now, when I say reviewyour 401 K options, they're may,
they may require you to to rollit out to an IRA, which you can,
they may not require you to rollit out to an IRA, which you
don't have to. But a 401 K at acompany that you're not at, you
(23:11):
got to look at the costsassociated with it. Because if
there's a lot of fees in there,then maybe you're better off
rolling it out to a four two toan IRA. Because then you have
lower fees, too. If you don'thave a lot of investing options
in that 401k rolling it out toan IRA gets you more investing
options. Now you don't need todo that right away, they'll give
(23:32):
you the timeframe to do it.
Because if you got employed withanother company that had a 401
K, you might actually be able toroll that to the company's 401k
If they have good options andlow fees. But point being is you
have latitude to do some thingswith your 401 K or your
retirement at that company.
without triggering tax withouttriggering penalties and giving
(23:52):
you the more offer more optionsand lower lower costs. You may
need someone to look at it withyou and help you with that. But
know that you're not required toleave it there. And in some
cases, you are required to takeit but you're not required to
leave it there and you haveoptions. Look at those options
before you make a big move.
(24:15):
Okay. Number eight. I just wantyou know, it's interesting. I
want you to create a brag book.
What have you accomplished? Howhave you accomplished it? What
are the keys what are the thingsa brag book, this isn't about
ego. This is about youunderstanding and valuing the
things that you haveaccomplished for the people that
you have served. Create a BrandBook. So when it comes down to
(24:36):
interviewing you may not begiving them the brag book, but
it's it's re enforcing the valueyou're bringing to the table of
a new employer a new job, a newendeavor, if you will, too
often. We remember all thenegative stuff the stuff that
isn't good. It's maybe we needto remember some of the good
(24:57):
stuff that we've done in a longcareer, we tend to forget. So we
ought to be building this bragbook all along. Okay, recognize
the things that you do. Numbernine. Number nine, is checking
with yourself. This one's a bigone. How are you feeling? What
(25:20):
are the emotions going on? Theremight be anger, there might be
resentment. There might be fear,it might be all of the above.
It's okay. It's okay. Don'tinvalidate them. You're gonna go
through a mourning process. Wejust don't want to live in the
(25:43):
mourning process. And away, wedon't live in the mourning
process as we start to do a fewthings for ourselves, do some
things for yourself. Maybe youjust need a weekend to chill.
Maybe you need a spa day. Maybeyou need to go for a run. What
things can you do for yourselfthat you know are gonna make you
(26:04):
feel good? Make you feelempowered, get you to feel
better? To get you moredirected, more focus? What are
the things that you can do foryourself? Ask for support. Ask
for people that that can helpyou. Look, no one's gonna judge
you. I certainly wouldn't have afeel for you. You know, a lot of
(26:28):
these laughs It's not it's notanyone's fault. So don't blame
yourself, don't beat yourselfup. Now, at the same time, I
want you to think about how canyou skill up to value up? Are
there skills that you canacquire pretty quickly or that
you should have acquired toincrease your value. So when you
(26:51):
go to another interview, oranother endeavor or another job,
you have more value to offer?
The more remember, we're in avalue exchange economy skill up
to value up when you skill up tovalue up your values up, you
become more in demand you morebecome more desirable, more
hireable, more, more of whatthey want. And then the last
(27:16):
thing in this, no matter what,just remember, it's not
personal. It feels it. Trust me,it feels it. But it's not
personal. They made a businessdecision. When they laid off
2000 People from what when mywife was part of that they
weren't specifically looking atStephanie and going, Yeah, your
(27:36):
God. I mean, they did, but waspart of a 2000 person group. It
wasn't personal againstStephanie, they made a business
decision. Now, here's theinteresting thing, she's in a
far better place, doing farbigger things, making far more
money and being far morefulfilled.
(27:57):
So in the end, it was better nowgoing through, certainly wasn't
great. But remember, isn'tpersonal. So with that, I kind
of start to look at this. Therewith uncertainty in the economy,
with people trying to tighten upwith rising interest rates,
there is a potential for morelayoffs. I don't know if it's
(28:20):
going to happen. And it dependson the industry, the geography,
the company, but it couldhappen. Hopefully, I've given
you a little bit of a recipe toprepare yourself that if it does
happen, you're in better place.
But it is also a recipe that ifit doesn't happen, you're in a
better place. It starts you onthis journey to financial
(28:42):
freedom up the wealth priorityladder, to move to a place where
you should be. And where I wantyou to be is where you are in a
place where you are workoptional, that you get a chance
to decide and have choice andthat you're working because you
want to not because you need.
You're working for you theimpact and the legacy you're
(29:06):
creating, and not the billsyou're paying. And so
ultimately, that's where I wantyou to be. It may take some
steps and some time to get youthere. But we'll get you there
if you stay on the journey. Andknow that you're not on this
journey alone, no matter whathappens. I'm here for you. I'm
here to help. I'm here to guideyou as best I can. If you have
(29:27):
questions you can come to me andask Mel now.com Leave me your
questions. I'll bring it on anepisode or I might even bring
you on have the conversation.
The key is this. I want you tobe on the journey towards
financial freedom. No matter howdistant it may feel today. It
will get closer if we start onthe journey today. And know that
every step of the way. You're inthis journey with someone who
(29:52):
cares in this process. Alright,I look forward to seeing you on
the journey. I look forward toseeing you grow I look forward
to seeing you soar and until wesee each other again on another
episode or another show, or outon the road. Always, always
strive to live a life thatCheers. Thank you for listening
to the affluent entrepreneurshow with me your host Mel
(30:13):
Abraham. If you want to achievefinancial liberation to create
an affluent lifestyle, join mein the affluent entrepreneur
Facebook group now by going tomelabraham.com/group, and I'll
see you there.
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