I’m unemployed! If you read my post from a couple of weeks ago, you’ll probably now know me as well as my own mother (don’t tell her that, though), so this may come as a shock!
A few weeks ago I was laid off from my job. It didn’t come as a surprise, as I wasn’t happy and it was obvious that the fit wasn’t right for either party. As much as it hurts to admit it, it did sting a little.
Luckily, I had already been planning my escape from it- I had even gone over the moment when I told my boss that I was quitting to focus on my businesses. My initial plan was to grow my Kindle publishing business to generate enough money to cover my expenses by the end of this year – which felt really soon!
You’re all clever people, so you’ll have undoubtedly noticed that I got laid off many months before my goal date. My jumping-into-the-abyss-day.
Although the laying off changed everything, I actually felt extremely happy at the news.
F. You Money
There is a term used all around the internet that explains my current situation; F. You Money (yes, the “F” means what you think it means).
It’s a quantity of money that gives you the security to make much bolder career choices. Since you don’t need to earn money urgently, you don’t have to rush into accepting any job you get offered.
In my case, it’s allowed me to take a step back and look at my life and career. It’s allowing me to give my dream life a real shot by not having to find another job just yet.
You see, during most of 2015, I had been practicing the life-changing habit of saving a large part of my salary. By the time I moved to Spain back in November, I had amassed around $20,000 (including a nice bump up in value from the stocks I’m invested in).
Since I keep my expenses low – and will lower them even more now that I work from home – this money will easily last me over a year. This is assuming I make no money whatsoever!
In reality, I expect to be able to cover my expenses before the end of the year, so I will be using less and less of my savings as time goes by.
How much do you need to save?
Common wisdom says that you should always have 3 – 6 month’s worth of expenses at the ready, in case of an emergency. I think that’s OK, but really, it should be as high as possible.
The higher it is, the more freedom you will have to decide the path you take in your life.
Imagine if you had 5 year’s expenses covered by your savings. You could easily go on a sabbatical year touring Southeast Asia, and you’d still be in great financial shape!
In fact, if you lived somewhere with a lower level of living, you could stretch that year much further.
The beginning of a nest egg
I believe in building a huge nest egg that will provide me with unlimited passive income, for the rest of my life. A year’s worth of expenses is a good start to that.
I strongly encourage you to save as much as you can, month after month, to accumulate a little F-You Money. Start now, and I’m sure it will be easier than you think. The more aware you are about your expenses, the easier it’ll be to lower them.
Life changes more than we care to admit, and jobs come and go. Having a money reserve can be life-changing for you, just as it is being for me!
In time, it will grow and grow, and it will end up giving you the complete freedom to live your life to the fullest. With or without a job/ business.
What do you think about all this? I want to get to know you as you’re getting to know me. Have you ever been laid off from a job? Do you have some nice F You Money yourself? Let me know in the comments below!
David @ Thinking Thrifty says
It’s so important to have a F. You emergency fund! I’ve built one this year for the first time in my life and have just had the news of certain redundancies at my place of work so it may just be coming in handy quicker than I had expected! Good job I changed my ways this year!
Ricard Torres says
I hope you don’t have to use your emergency fund, but building it may prove to be one of the best decisions you’ve ever made! It will also give you the confidence and security to be more aggressive with job hunting – asking for a higher salary, negotiating better employment terms etc. Best of luck, and keep building that nest egg!
Thanks for commenting!
I got laid off and realized I really wanted to just go into business for myself once my husband was done with school. Now that he is done, and I’m no longer the breadwinner, that plan has not changed. We put a substantial of savings away, are aggressively paying off the remainder of our debt, and live off of one income. This will provide me with the opportunity to grow my business without having to worry about the essential bills (which he covers now while I’m at home with our two youngsters). Our money is a tool for us, not a stress outside of our control. Getting laid off was always a huge fear of mine due to money. Then it happened, (it was a job I hated anyway) and I realized I needed to be in control of my life, and my money, not hand that over to my employer. I know I will do what it takes to make my business work. A company will do the same, but it may be at my expense. I don’t want someone else to have that kind of control over my life. Though tough at the time, getting laid off was one of the better things that happened to me in the long run.
Ricard Torres says
Great philosophy! Getting laid off can really be a blessing in disguise for many people, like you and me.
I also love what you said; “Our money is a tool for us, not a stress outside of our control”. This is something more people need to understand and, hopefully, we’ll accomplish it through our blogs.
Thanks for commenting, and good luck with setting up your business!
Wes @ TPOHappiness says
I recently had a parting with my former employer as well. Thankfully, my wife and I had setup our own F. You Money fund which has allowed me to take a much more involved role in the life of our newborn son than I would have normally been afforded. There are benefits of planning for the unexpected.
Ricard Torres says
That’s AWESOME! That’s the real purpose of money if you ask me – it provides you the liberty to enjoy life and experience things many people can’t, like spending time with your son. I can’t think of anything better than that 🙂