The coronavirus pandemic has seen countless businesses close their doors causing massive layoffs. According to economists in the country, over 20,000 jobs are likely to be lost in Kenya this year with the CEO of Institute of Economic Affairs, Kwame Owino, projecting that the growth of the GDP could decrease from 5.7% to below 2.3% this year.
You would call yourself fortunate to still be employed at the moment. Nevertheless, it is a good idea to be ready for the worst. Here are a few steps that you can consider to ensure that you are well prepared in the event that you fall victim to the looming massive layoffs
Prepare yourself for the worst
The uncertainty surrounding the duration of this pandemic is only complicating matters. The best you can do is to brace yourself for the possibility of staying out of work for several weeks if not for months.
A good way to go is to set up an emergency fund. It is much easier to set aside some amount now that you are still on a salary. Do your best and establish your emergency fund right now. Aim for saving enough to last you at least three months of sorting out all your expenses, nonetheless, having something is better than not having anything.
If you are unable to come up with extra cash to set aside, then you need to relook your expenses and cut out anything that is not a need. Make small cutbacks in your budget and you will be impressed with how much you will be left with to stash in your emergency fund.
Make use of all your resources
Being able to set aside some money from your normal budget is only part of the bigger picture. You need to top it up by making use of all the resources you have. You need to have your emergency savings easily accessible but at the same time be where they can grow quickly. You can approach your bank and find out if they have a high-yield savings account. These accounts will earn you higher interest rates compared to your standard savings account.
You also need to keep abreast of the changing regulations and waivers to see if you could save some more money. For instance, commercial banks in Kenya extended the repayment period of personal loans by one year in a bid to alleviate the adverse economic effects borrowers may be facing due to the coronavirus pandemic. If you have a loan, this move could help free up some room in your budget and you can move that cash to your emergency fund.
Right now, you don’t have control over your job status and you might be one of the millions likely to lose their jobs in the coming weeks or months. However, you have control over how well you prepare. Try and do anything and everything you can to build a healthy emergency fund. This way, you will be ready for whatever will happen in the future.