For the past decade, I have earned my living almost entirely via a series of contracts, which have spanned anywhere from a couple weeks up to about 48 weeks. I was told just a few days ago that the contract that provides my family with its greatest source of income would end in just five weeks – more than two months earlier than I had originally agreed to. While I was initially disappointed, and yes, even a little angry, I was neither panicky nor frightened.
The reason for my calm is twofold – first, I trust God, and second, I have a contingency plan for such contingencies.
I understand that God will not abandon my family and me, and that He has promised to provide for our needs. That promise alone gives me a great deal of comfort. Consider the words of Jesus as he explains the vanity of worry to His disciples:
"Therefore I tell you, do not be anxious about your life, what you will eat or what you will drink, nor about your body, what you will put on. Is not life more than food, and the body more than clothing? Look at the birds of the air: they neither sow nor reap nor gather into barns, and yet your heavenly Father feeds them. Are you not of more value than they? And which of you by being anxious can add a single hour to his span of life? And why are you anxious about clothing? Consider the lilies of the field, how they grow: they neither toil nor spin, yet I tell you, even Solomon in all his glory was not arrayed like one of these. But if God so clothes the grass of the field, which today is alive and tomorrow is thrown into the oven, will he not much more clothe you, O you of little faith? Therefore do not be anxious, saying, 'What shall we eat?' or 'What shall we drink?' or 'What shall we wear?' For the Gentiles seek after all these things, and your heavenly Father knows that you need them all. But seek first the kingdom of God and his righteousness, and all these things will be added to you. "Therefore do not be anxious about tomorrow, for tomorrow will be anxious for itself. Sufficient for the day is its own trouble.” (Matthew 6:25-34, English Standard Version)
That being said, I also understand that duty calls me to play a primary role in providing for the financial needs of my family, so I maintain a dynamic plan for contingencies such as these. Duty calls husbands and fathers to be ready, so here are five steps to take to avoid panic if your primary source of income is interrupted.
1. 1. Build and nurture an open relationship with God. Really, if you think of it, our relationship with God is the only true foundation for peace and prosperity in our lives. It may sound trite, but the bumper sticker saying – No God, No Peace…Know God, Know Peace – is undeniably true. While knowing God will not necessarily eliminate storms from our lives, a strong and trusting relationship with Him will provide an anchor and shelter during times of trial.
2. 2. Build and nurture an open relationship with your wife and children. Hey, you aren’t in this alone! If your relationship with your wife and children is already weak, losing your job isn’t going to make it any stronger. If you have fissures in your family relationships now, do whatever it takes to patch them BEFORE you run into financial difficulties. Get it right because not only will you need to depend on your family’s support if things get tight, but they’re going to look to you for calm reassurance, guidance, and stability. Remember, if your income suffers a sudden and dramatic decrease, you’ll all need to pitch in to recover. It’s beans, rice, powdered milk, naked potatoes, and peanut butter sandwiches on balloon bread (can you tell we’ve been there?) for everybody, so make sure your relationships are strong enough to deal with it.
3. 3. Build a contingency plan and keep it up to date. Okay, this one is important. Whether it’s creating a game plan for football or building plans for a military campaign, wise men understand that things rarely happen exactly as they envisioned. In sports, as on the battlefield, the opponent always gets a vote, so wise planners create contingency plans. You should be no different when it comes to your income. This is always applicable, but especially true during these uncertain economic times. Having lived through a major layoff and some breaks in contracts, my contingency plan has evolved to fit our specific needs, but here are some basic steps to get you started on your own plan. Keep two things in mind here. First, put your plan on paper; no cheating here and no excuses. If you think you’ll just keep your plan in your mind, you’ll fall apart exactly when you should be standing like a rock. Second, remember that you’ll need to update your plan periodically as conditions or circumstances change. My plan now that we are empty nesters is significantly different from what it was when we had children in our home. My wife and I are in a position now where it would be easier pull up stakes and move across the nation or over the ocean to work than when our children shared the same roof.
Okay, here is a basic framework to get your contingency plan started:
- Have a starting proposition to guide your thought processes. Answer the basic question: What will I do if I find my primary source of income cut off today? Put it on paper! “If I lose my primary source of income today, I will…”
- Next, create a list of your sellable skills, knowledge, and abilities. Don’t limit yourself to what you’re doing right now. If you think about it, you will find that you can do many things to earn income that are unrelated to your current work. In fact, you may develop an escape plan here that will help you start a completely new track, whether you are forced onto that track or decide to embark on the journey as a volunteer! By the way, here’s an excellent opportunity to build your relationship with your wife by enlisting her help as you build your list.
- Once you’ve developed your initial list, think about ways to make yourself more valuable in the areas you’ve identified. Think deeply and consider alternatives that involve self-employment as well as employment under somebody else. You may even want to consider branching out into an area or two while still working your primary occupation so you can make a quick transition if you lose your primary source. Some of the most successful people I’ve ever known earned income from multiple – and widely dissimilar – streams, so I’ve worked to do the same. For example, one of our friends made money through his wallpapering business, through a variety of vending machines, and by raising and selling exotic birds. Another supplements his income as an Emergency Medical Technician by doing upholstery work (e.g., repairs, new installations, etc.) for restaurants and other areas of entertainment. In my case, I currently maintain three different streams of income and keep a running list of places where I can find quick work related to my interests and skills. The key here is to avoid painting yourself into a corner by focusing only on one skill. It’s better to be a well-financed generalist than an unemployed specialist.
4. 4. Build a financial cushion. Do your best during the fat times to build up a cushion for the lean times. Dave Ramsey’s excellent program, Financial Peace University, provides an wonderful roadmap for this part of your contingency plan. Mr. Ramsey’s first “baby steps” to financial peace are an excellent way to build your cushion. First off, as quickly as you can, build a $1,000 emergency fund and don’t touch it unless you really have an emergency (e.g., you need tires for your car and you must either tap the emergency fund or use the dreaded credit card). Secondly, pay off all your debt, except your mortgage (that will come later), using what Ramsey calls a “debt snowball.” To do this, you simply list your current debts (i.e., credit cards, personal loans, education loans, etc.) according to their size. Don’t pay any attention to the interest rates or any other distractors. Once you’ve listed your debts from largest to smallest, make minimum payments on all but your smallest debt, and then make every effort to eliminate that debt as quickly as possible. Once that debt is paid off, do the same for your next smallest debt, and so on until you’ve eliminated your non-mortgage debts. Finally, set aside (preferably in a separate account) enough money to pay your basic expenses for three to six months. If you do these things, you’ll be much less prone to panic if you suddenly lose your primary source of income.
5. 5. Build and maintain a network of business-related contacts. It is vitally important to build a list of people you can call on to help you earn an income. Create a list of contacts that are both inside and outside your current occupation and keep it handy so it is easy to update. Keep in touch with the people on your list and maintain warm relationships. That way it won’t be awkward to call on them if you need their help as you work your contingency plan. Periodic emails or phone calls can keep the lines of communication open. Of course, you don’t want to be a pest or spammer here. You’ll want to remember that like all relationships, business relationships are reciprocal in nature. In other words, avoid being just a taker.
Author George W. Crane once said, “There is no future in any job. The future lies in the man who holds the job.” That is a truism that spills into our duty to provide for the financial needs of our families. Our families’ financial futures are tied more closely to us, as men, than to the jobs in which we find ourselves. Duty calls us to be ready for any contingencies in this arena.