Your boss has just informed you that your department is being reduced by two and you are fired. After he leaves, what are you going to do? This is not about finding a job it?s about being prepared for financial change. How you prepare for employment change is different for everyone. Being prepared for financial change is the same person to person.

1. Build an Emergency Savings Account

Everyone should have a passbook savings account with money to use in Emergencies. This money is to never be touched except when your car needs repairs you can not afford, your basement floods and you need to pay to clean it up, or your Great-Grandma Ruth is dying and you need to go to her bedside.

Use your Emergency money, and immediately start rebuilding it by paying yourself. A good amount to have in this account will equal six months of your net income (after taxes). This will provide you with a cushion for when you receive the pink slip. If you have a little time to search, you will be able to find enjoyable, quality employment.

2. Prepare a Spending Plan

You already know you should be living on a spending plan now. Have you thought about how you would live after a job loss? Take time today to create a ?Job Loss Plan? so you will have an idea what spending you will reduce as soon as you know you our out of work. Then as soon as you are told those two little words (You?re Fired) you can pull out the plan and start conserving your money. Do not deny what happened and continue trying to live like you did before.

3. Carry No-Debt

This is good advice for everyone, but as it pertains to this article no-debt is really wise. If you are out of a job, you do not want to be paying $500 a month in non-mortgage bills. By keeping your credit card and even your mortgage debts to a minimum, read zero, you will be able to stretch your Emergency Savings Account money further. Even if you have a good job that you will never loose, if you are not carrying debt, you will be able to put more money into your retirement, children?s college or vacation fund.

4. Know Your Creditors

If you do carry debt, be sure you know who your creditors are. This sounds silly, but a lot of people receive a bill from XYF Credit Co and pay the minimum without looking to see who XYF is. You should know your creditors and how to contact them, so that if you are laid off you can call them right away and let them know. Most will work with you to create a repayment plan that fits into your new spending plan.

When the hammer falls and you are let go, it will be shock, no matter how prepared you are. If you have been working on these four things your finances will be better able to withstand the time between jobs.