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Dave Says: Going into Emergency Mode

Dear Dave,

My wife just received news that her company will experience significant layoffs in the next two months. On top of all this, she’s one of the newest workers there. We’ve been trying to follow your plan, but what should we do with the possibility of unemployment on the horizon?

Tyler

Dear Tyler,

It’s a pretty safe bet that your wife will lose her job, especially if she’s new to the company. If what she makes right now is a significant portion of your overall income, my advice would be to press pause on your Total Money Makeover and build up your savings as much as possible.

I love that you guys are trying to take control of your money, but right now there are storm clouds brewing in your financial lives. Sit down together and come up with a seriously belt-tightening budget. Scrape together every nickel you can from every area of your lives and put it into savings. Things like going to the movies or eating out are going to be a big no-no for a while. And you may have to look at the possibility of cutting some other non-essentials, like television. There’s nothing good on these days anyway!

If they do lay her off, she might be looking at a severance package, but at this point you can’t really count on that happening. So batten down the hatches and prepare for the worst while hoping for the best. The best way to do that right now is save, save, save!

—Dave

Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 5 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.
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