MONIE Orchards - Personal Financial Planning
Using the Building Blocks to Answer the Essential Questions

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What if I become unemployed?

There can be multiple reasons why you become unemployed, the most common is being retrenched, or becoming ill. I have already talked some about unemployment due to illness, here I would like to focus on unemployment due to becoming retrenched.
Here you basically two options - live on your savings, or move in with your parents (or children)....
The second option is not generally desirable, but bear in mind that for long periods of our history, it was common for multiple generations to live together. It is also still the case in many cultures around the world. It of course will not work in a two bed-room apartment, but in a dwelling purpose built for living together it can work well. And also be much cheaper than maintaining two households. Do bear it in mind as an option.
When you get retrenched, or become aware that retrenchment might happen, your reaction will depend on the level of retirement savings that you already have, and how accessible the funds are.
At the one extreme, you could already be close to retirement, with a retirement fund that is large enough, or nearly large enough to retire on. In this case not much of a problem.
The other extreme is that you have little to no savings. In this case you will need to carefully evaluate your expenses, and see which of those are necessary. You might have a car loan on a car that is way too expensive: consider selling the vehicle, and paying off the loan. However, be careful not to react in panic, and get rid of everything in a fire sale. Take into account (realistically) how long the unemployment might last, what the options for alternative, short term employment might be.
Many people use such an opportunity to start a business, and do very well from it. However, be careful not to throw away your severance package or savings that you do have on a hare brained scheme.

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