A 50-something editor friend reached out last week to say that he had just gotten "the call." Apparently employers have decided it's less messy to call you at home to let you know you've been laid off instead of the old way of tapping you on the shoulder at 2 p.m. on a Friday and asking you to stop by the Human Resources office where a stack of papers and the end of your job awaited. Doing it the new way presumably cuts down on those tearful goodbyes and disruptions to the work day. Employers are such a compassionate lot, right?
Anyway, having walked in this guy's boots myself in 2009, I knew exactly what was causing him to quake when he called: The two H's.
"You're mostly worried about health insurance and losing your house, right?" I asked him.
Those two things are always the principal boogeymen who haunt your dreams when you get "the call." It took me a while, but I speak from experience when I say that while the solution to those worries isn't perfect, at least there is one. And to be frank, there is something much bigger you should be focused on. But first, let's dispense with the two H's.
Health insurance: If you are laid off, you are in most cases eligible for COBRA, the federal Consolidated Omnibus Budget Reconciliation Act that lets displaced workers buy into their former group health plan. Since a lot of companies require that you foot the whole premium bill, it isn't cheap, but at least you have access to health care. Professional trade groups and university alumni groups have also stepped up and may be able to help; call up your college and ask. There are even some freelance groups that are now offering health insurance. I know one woman who moved to Massachusetts because that state offers financial help to pay for health insurance to the unemployed. For the most part, someone like my recently laid-off friend is going to find health insurance. Dispense with Worry #1, I told him.
As for the second biggest fear -- losing your house -- you'd be surprised how unlikely this prospect is. At the risk of sounding flippant, you missed the worst of the storm. From 2008-2011, people got into trouble with their mortgages because their loan rates adjusted after they lost their jobs and housing values plummeted. At the moment, the housing market is pretty hot. Chances are, you aren't upside down on your loan and probably have some equity in your house -- which means you can always sell it if you have to. Your only real goal here is to hang on. And that's not the big deal you fear.
Why? Because most of us tend to spend to capacity. We earn a dollar and we find something to buy with a dollar. That spending attitude changes when you lose your job. Instead of your freewheeling spending ways, you need to start with a zero-based budget. You make a list of all your monthly expenses and draw lines through the ones you can do without. Then you make a second list of all your income -- including the unemployment insurance you will be collecting, as well as any severance package amount divided by 12 (for a year).
In my friend's case, the money coming in will cover most of his mortgage and essential expenses for at least a year even if he didn't earn a nickel. And he has enough savings that a carefully watched slow withdrawal -- while not ideal -- will ensure that the bank wouldn't be foreclosing on him anytime soon. So for the short-term, he can breathe a bit easier.
But what my friend -- who has a wife and child -- has yet to come to grips with is a much bigger problem, one shared by a lot of post-50 people who lose their long-time jobs: His skills set is obsolete and has very little value in today's market. It's a big ouch to hear, I know.
Even worse, if he spends a lot of time looking to replace his old job in what is now a dwindling field, he is likely to burn through his savings and still not have a job. And then he's going to really be in trouble. How do you accept that you won't be able to work in the field you loved and spent 30 years? The only way is to open your eyes and your heart to the next chapter and just do it. Yes, I'm practicing tough love here, but I've seen too many journalists friends spin their wheels and try and find jobs that don't exist anymore.
The reality is that my friend needs not just another job, but a job in a field that is hiring. And to get one of those, he probably needs to go back to school first. I asked him if he'd ever considered nursing or a job in health care delivery. Yes, I'm serious. Forbes proclaimed registered nurses the No. 1 job with the brightest prospects and I had a chance to chat up many a nurse during my daughter's recent hospital stay. They work three 12-hour shifts a week, bring down good money, and totally love having four days off every week. With the population aging, there will never be a shortage of good nursing jobs.
For the blood-squeamish, there are also degrees in computer science. The Bureau of Labor Statistics says software developers earn on average $90,530 a year, and the BLS expects a 30 percent increase in the number of jobs by 2020.
Losing your job at 51 is a tough nut to swallow. The unwillingness to accept a change in what you do for a living is what chokes you though, not the nut.
Whether you plan to bake cupcakes, be a consultant, or manufacture a product, the first questions you must answer are the same, says Chodos. “Who are my customers and do I have a product or service that they want and are willing to pay for in an amount that my sales will be greater than my expenses? Until you have a really solid sense of how your business will succeed, you need to keep answering those questions… Research, analysis, and testing beforehand is heading you down the path to getting it right.” Really hone in on what you’re selling. “Describe as precisely as possible what you’re going to sell,” advises Jeff Williams, CEO and chief coach of Biz Starters, a company aimed at helping people over age 50 start businesses. “Many people come to me and they want to sell two or three different things all at once. It doesn’t work. You need to be specific."
Many businesses today start from right inside your home without a lot of cost for equipment or rent. But there are other factors to consider, Chodos says. How much will it cost to start your business and to run it for its first year? Will you need to invest in inventory? What will the costs be for advertising? Is there equipment you need to purchase? Will your electric bill rise? Ask yourself what you’re willing to invest, what you might have to borrow, and how much you expect to make from sales. If you can’t answer those questions yourself, consult with an expert.
“This is the most important part of your business,” says Williams of biz starters. This plan must answer the questions described above, but it also must help you identify how you’ll find your customers. “Are they on mailing lists? On the Internet? In industrial listings? This is the usually the most difficult part for people, because if you previously worked for a corporation, the corporation brought you the customers. Now you must go out and find them.” Research, networking and word-of-mouth are your three key approaches. For information on how to write a marketing plan, check out this information.
“We’re all at square one when we start a business,” says business consultant Nancy Michaels, founder of "The Grow Your Business Network." “The great news is that by the time you’ve hit 50, you should have some connections in the world. Tap into that and let people know what you’re doing. They can help spread the word for you.” Start by announcing your business to all of your email contacts and a simultaneous announcement on Linked In, says Michaels. “Tweet about it, and put it on Facebook and maybe even make a video so you can post it on You Tube.” If your business warrants it, consider an open house to which you invite your contacts. Depending on your business, it might make sense to start locally rather than trying to reach a national market immediately, but first evaluate who and where your customers are.
If you are offering a service, you are more likely to be hired if people feel you know what you're doing. Establish a professional looking and accessible web site that boasts “strong, selling-benefit oriented copy,” says Williams. Have friends or business associates critique it and make sure that it highlights your accomplishments and abilities. And get the word out about yourself. Write articles and other content related to your business and post them on free article archive sites like Linkgrinder with a prominent listing of your web address, Williams says. He also suggests that you regularly send out publicity articles talking about key phrases for your business. Once you’ve done this, you can speak to civic groups or other organizations to further establish your expertise. Note: Approach trade shows with caution. Williams says it can be an expensive undertaking with not that much reward. Better: Once you have landed a few customers and feel the business is rolling, a trade show might be a good next step.
If your business is consumer-based (you’re selling cupcakes, for example), use Facebook to promote it, says Williams. If it is a “b-to-b” business, one that sells services to other businesses, use Linked In to promote it. You can use both platforms to make announcements about your business, to remind consumers you are there, or to hang out your shingle, so to speak, so that people passing by will notice it.
By the time you get to the six-month mark, if you’re not seeing some steady income, it doesn’t mean you’re an outright failure, says Williams, but maybe you’re not getting your message out. You’ve got to continue to tweak it. “If you are honest and accurate in your revenue model and you are not making money, then you usually need to go back to one activity--sales prospecting,” Williams says. “Ask yourself: are you doing enough of it and is it well-focused on the people you are trying to reach?”
Where to go for more information, to learn about free seminars, and even set up free one-on-one counseling for entrepreneurs? Check out: The Small Business Adminstration’s website Retirement Revised Encore.org Inc.com Entrepreneur.com
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