Tuesday, 24 May 2016

Crisis and retrenchment – What if it is me? (Part 2)

This article continues from previous post (refer here) where I discussed how to stay financially and mentally resilient during a crisis resulting in a retrenchment. The discussion apparently did not include the type of resilience such as acquisition of work skill-sets which can easily be transited from one company/ industry to another.

Why retrenchment can happen to any employed person?

Some people say “Oh retrenchment will not happen to me, because I have a stable job…Oh I am young, can find another job easily…Oh, I am highly valuable to my company...Oh my boss like me…Oh I am in civil service!”  It can be true NOW, but certainly not throughout your entire working life. 

Is it a big deal that we are young now? No! I am still young also, but everyone grows old one day with more burdens on our shoulders from family expenses. Even when you are frugal, but living in the inflationary Lion city is going to be tough.

If you think you are really valuable to your company, sometimes the ugly truth is because you are still “cheap” in salary. Your salary may go up one day and you can become an eye sore during a crisis too. Okay…you win! You prefer to be lowly paid! Counter-intuitively, lowly paid does not always mean you are on the safe side. Due to change of corporate structure, you can be made redundant by the highly-paid bosses too. The most junior staffs in my office were the first to be let go during this crisis.

Your boss likes you now, but your boss can change before you realise. For some reason, your new boss may loathe you. Even when your boss is owner of the company, he can sell the business to a new owner. This happened to me a few times.

Perhaps the only exception is probably when you are working in a civil service and has an “iron rice bowl”, so as to speak. Yet, how many in the civil service really enjoy their job? Honestly, civil service tends to provide more opportunity to “scholars” and for “farmers” the path of climbing is really long and gradual, which also mean lesser exposures and lower salary comparatively.

With all aforesaid, it is of grave importance to be financially and mentally prepared for a downturn, even if chances are slim for you to be “slashed”. Those who follow my blog will know that I had long prepared for this impending crisis, not just limited to my industry of O&G, but also extends to the general economy as a whole.

I already considered myself to be lucky up to now that I am still surviving with a comfortable income with manageable stress in my job. Many in similar category as me either already left or is so stressful and unhappy about work now.  Maybe it boils down to this…Read: Oil & Gas Crisis – Time to Take On More Work Even with No Pay Raise!

Anyway, if the unfortunate do take place on me, what would I really do next?

Have a peaceful mind! Do not rush into the next job desperately

No matter how well prepared we are, when an ill-fated dismissal actually falls upon us, emotion is bound to be stirred and feeling sad is inevitable. In situation like this, our mind is definitely not in the clearest state to make good decision. Hence, the need to have a peaceful mind before making the next decision is extremely important. 

I am suggesting to myself NEVER to rush into the next available full-time employed job desperately. In any case, since the Oil and Gas industry is so bad now, rushing from one job to another can also mean jumping from one shit to another!

The worst thing you want is to get into a new job and then get retrench within few months again. I already saw many friends entering into this kind of shitty situation now, and they are really unhappy! 

Take a well-deserved break

Ideally, go sabbatical for 6 months or more including the few months’ notice period and balance annual leave. Do NOT even search for ads on job during the first 3-4 months at least. I will try to enjoy this period on things that I could possibly miss out in my life due to work.

Spend time with my kids

Priority number one for me - more time with my kids. You simply cannot turn back the clock when they grow up later. That said, I will not be just a stay-home dad doing household chores and become a nanny to my kids! By the way, I hate doing these chores. I prefer to be a Father, a Friend and a Mentor! While I am already my children’s part-time tuition teacher outside textbooks, I endeavour to do more with a more structured way of teaching for them. Of course, I will exercise and play with them, such as swimming, jogging and do art and craft with them. Whatever it is, the thing that matters most is to spend more time with them during this period. 

 Paintings by my 5-year-old and me!

Freelance Options

Option A
Through referral, I actually started writing freelance for the O&G sector last year. I had since stopped due to my busy schedule lately. If the “brutal axe slashes”, I will like to continue.  

Option B
A friend of mine is the founder of his tech start-up business with vested interest from VC. This friend is an IT guru, but never really a sales and marketing guy. Last year he approached me if I am willing to help him strengthened this area. I declined due to my work commitment. Perhaps if I am made redundant, I will look into this option.  

Option C
Another friend of mine is leading his family business in the sector which I am extremely familiar with. Many times, he had hinted to me how desperately he needed a trusted person to assist him since he is unable to cope. So this is another viable option.    

For options B,C &D, I will only consider if it is freelance and definitely not within the first 3-4 months as I wanted to have a well-deserved break.  Furthermore, I will not ask for high salary or probably even only ask for some transport allowances or commission based job. First, I do not want the unnecessary stress to achieve unrealistic good performance in a highly challenging environment now. Second, I want conflict with “friends” to be mitigated to bare minimum. Ideally, it should be treated as helping friends out, rather than them giving me a helping hand.

Option D
Helping in my sister’s business. This is least likely to happen unless I am really desperate. Working for siblings is never easy.  

Self-improvement - read more books and attend more courses

Time is something I lack to read as many books as I wanted lately. My usual book reading onboard airplane is cut down by lesser traveling due to the diminished projects and cost cutting measures. 

To do well in life, I strongly believe we will need a WISE mentor to guide us along the way. If fate does not bring you one, do not fret over it. This is because reading simply can be the best way to substitute your real life mentor. After all, a good book can enrich us with almost a lifetime worth of invaluable experiences from the author.

When it comes to reading, do not mistaken reading of newspapers, articles, magazines etc as similar to reading a book. The former provides more information rather than the much needed wisdom from a book. Anyway, people nowadays have definitely no lack of information compared to wisdom! Words are essentially one of the main building blocks of life. Our future depends on the words we believe about ourself now, whether read, listen, written or spoken. So if time is granted, I will definitely read more books for self-improvement. 

To add variety to learning, attending courses can be great as it allows “live” interaction with people that a book cannot provide. Just have to take note of the charges!

Compile my own “Gift” for my children

Inspired by legendary investor Jim Roger’s book : “A Gift to My Children - A Father’s Lessons for Life and Investing”, I will want to publish my own book for my children one day. This is also one of the reasons why I started this blog. So perhaps retrenchment will come in handy for me to start compiling my past articles. Read:


Investments

Keeping myself abreast of investment is something I will definitely do with or without a crisis. Yet, we should bear in mind that staying too fixated on the stock market and making lots of investments during your sabbatical is also not as wise. So take it easy and be patient and discipline in our investment activities even if we have all the time at home from not needing to go to work.  The last thing we want is to deplete our still healthy cash position fast and feel pressured to go back to work soon!

Six Packs

Finally six packs! A challenging one indeed. This is something that I had never have in my entire life despite that I had always been a sporty person.


No job got six packs, also not too bad an idea! Haha!

Rolf's final thoughts

The morale in the O&G industry is very low now. It is not just in Singapore, but worldwide within this sector. Most people are very free now (me included) with so few projects to speak of. The sentiment is definitely NOT:  “free and happy” but “free and worry” instead!

I am not saying that I am outright certain to be retrenched soon. In fact, I was given added responsibility lately as compared to my fellow colleagues. Besides, I am quite confident that my skillset, experiences and career track records should be able to help me leapfrog to other industry much easier than others, for as long as I manage my own expectation about the income part. In any case, “prudent man prepares”.

No need to say “heng” you are not in this sector! The truth is the economy in general for Singapore is going to really tough ahead. Many people in other sectors are going to be affected, if not already affected! Sometimes, it can be either the “nasty wind” has yet to blow in your direction or you are still ignorant about it. Perhaps because you are not in frontline, and still working on existing projects so you may not know what is really happening in the market! Even if you are dealing with figures, there will be a lag between company financial performances relative to general market conditions.    

Why do you think PAP brought forward the 2015 general election?

The above plan is a short term one. If the downturn is going to be a structural one that last more than 2 years, instead of a cyclical one, then perhaps some rethinking is needed later for me. Uber….nah! Teaching…..maybe?



12 comments:

  1. Hi Rolf,

    You are so full of...plans! I also had a list of options available for me when shit hits the fan. Not all are to find options for earning income, some are projects to fill myself with opportunities when the downturn stops, some are projects to fill my time with memories etc.

    I think the worst thing one can do is to feel self-pity and see oneself as a victim. That, I would not do.

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    1. Hi LP,

      The problem with self-pity is no one will pity you except for your pitiful parents. Maybe ur wife also will not pity u!

      Good to hear ur options for fulfillment and opportunities. It sounds perfect.

      No lar, while I usually plan and strategize (maybe not as much as u think), my life has more actions relative to plans.
      My wife and friends always say I action pack leh, cannot wait, must fast fast do!

      That is why I am learning to manage my temperament and stock market investing is perfect for me in this sense.

      I reckon as I aged, actions do give more and more to increased quality thinking!


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  2. Rolf,

    I have your six.

    LP, these are not "plans"; these are "options".

    Plans are to secure something you have yet to achieve.

    Options in Rolf's case are already SECURED offers just waiting for Rolf's final decision.


    You think why Rolf is taking it easy and not rushing into the next available job if retrenched?

    ReplyDelete
    Replies
    1. Hi Jared,

      You stolen my six packs?

      Hmm.. yes "options" not equal to "plans"!
      But option also have expiry dates of u do not exercise on time!

      Anyway, if we still need to work for money then options are still more limited! I confess that I still need money now! No shame, bcos I do not want to be over frugal and I want to at least pay my kids education, maybe even overseas education.

      Making the "right or wrong decisions" in life can sometimes change our entire life.

      I always feel that while wide knowledge, good understanding and plans are important, decision making (or action) is something that is even more important that differentiates! Even 1% action a day to improve ourselves is good!

      Delete
  3. Interesting blog. Thanks for the articles. I was there before. No job. Desperate. I'm now doing much better than ever. Life is a journey. Enjoy the process.

    ReplyDelete
    Replies
    1. Hi Anonymous,

      Yes indeed life is a journey and it can be a roller coaster ride, which we just have to ride it sometimes. At least after the ride, u can cooly look back and say I rode it courageously without regrets!

      Good to hear that you are doing better than ever. Best of future ahead to you!

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  4. The mystery of all is with all these bad economy news
    why people in the the market still flolicking happily in a swimming pool?
    They should be heading south at least slowly, isn't it?
    i guess buying "euphoria" have not been seen in a bull market yet.
    The lemmings have yet to appear.
    Then everybody will madly rush for the exit.
    Then you know, a black swan has appears.
    When?

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    Replies
    1. Hi temperament,

      Historically it should be euphoria before crash. I agree with you!

      Some people say when the USA is going raise interest rate, then economy is going to slow rapidly, then the Fed will panic and there will be QE4. The stock market will rally again and that will be the last time it rally, before finally too much $ and inflation and market crash!

      So we still can wait for the next rally before we sell everything???

      Alternatively Trump wins the election and started out on many unique and short term effective policy (long term detrimental) that US citizens think it's good, STOCKS rally temporary before US international relationships strained and tension lead to stock crash!

      Just imaginations!

      For now, it does not seem that economy is heading steep downturn because globally there are still morphine injections (monetary policy) to curb the pain.

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  5. hi Rolf, been following your blog for a while but dont think i've commented before. we are both about the same age, engrg-trained, likely started working around the same time (SARS!), both fathers to young kids and work in the same industry (upstream o&g -in fact i suspect I know where you work!). Its tough times indeed - my sales role has mostly morphed into running after people for money now =P
    I love the options you've put together - I'm also spending more time at home when i can now, and I've built up an emergency fund to last 12 months without income, because this downturn could be as bad as the 1980s. All the best to the both of us.

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    1. Hi Serendib,

      Thanks for following my blog and the compliments.

      Good to find someone of similar generation, background and interests here.

      Yeah...very tough times indeed! Many "old bird" already commented that it is worst than the 80s one.

      Chasing after people for money is tiring. Being chased after also sian....
      I always remind myself : Never offend anyone in the market and in fact use this chasing of money opportunity to strengthen on the relationship if you believe your client will still be around after the crisis!
      I did that during 2009 GFC and so far it turns out well.

      The most refreshing thing to hear is that you are all prepared to weather the crisis. May we survive this crisis and turn out stronger and better later.

      Oh ya, in case we ever meet in the industry (i.e. if we still survive) since you think you know me, just give me an headsup!
      I prefer to be anonymous here, but in real life I am ok to say hi and get to know.

      Delete
    2. Hi Rolf
      You have excellent options/plans. Especially your ‘6 pack’ plans. Spending time excising/pumping iron/hitting the punching bag trigger the flow of endorphin through the body. There is a possibility of having more kids after you attain your 6 pack!!

      It is similar in the resource industry. Morale is super low. There is a structural change taking place as commodity prices have stayed low for a few years. Redundancies/retrenchment has been rampant in the industry. I've been prepping for industry downturn for a few years. I should be able to survive for quite some time without work if I kanna retrenchment.

      On the other hand, precious metal prices went up this year. I am not sure what to make of it. Gut feeling tells me it is only temporary. But hey, I am no economist. Just sit back and enjoy the ride! Hopefully, everybody follow gold bugs and buy more gold!!

      By the way, do you reckon gold prices will continue to shoot all the way up?

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    3. Hi Chewyc,

      Tks for the compliment. Not excellent lar... just relevant to me. haha... 6 packs = more kids, good idea! Only thing bad is no income.

      While I m sorry to hear the misfortune in the resource sector, I m happy to hear you can survive for a long time if the unfortunate happen.

      Anyway, I wrote before that crisis is the best time to learn.

      http://www.rolfsuey.com/2016/02/crisis-we-should-be-happy-because-it-is.html?m=1

      If we can survive well during terrible times, I m sure we ll do extreme well during the good times!

      For Gold, my understanding is that pricing is always driven by sentiments in the short term. Gold price went up due to fear of economic crisis esp during the start of the year. Silver also went up but not as much.

      However in the long term, or in the history of mankind since 5000 years ago, gold n silver always manage to store its purchasing power up till today. In contrast, Fiat currency (not back by anything) just repeats itself over and over again with hundreds of examples of collapse to zero value. Zimbabwe recent times, Germany mark 1920s, China in 1940s etc

      So as long as people spend more than they produce (deficit spending) and increase it more and more (print more n more also), eventually it will lead to hyperinflation and fiat currency collapse. Question is when? 10, 20, 50 yrs?

      I do not know about gold prices shooting up in the short term future, but acc. to Ray Dalio it's always good to keep 5-10% portfolio in gold. Just in case our Fiat currency collapse.

      Jim Rogers forsee that Fed will raise rates n gold will sink to below $1000/oz n usd will surge and stocks will rally. That will be the last time and then the entire global system will collapse.

      Those are just views. I think it's impt to keep some gold in case the expected happen. Pricing of 10-20% difference to me not so critical bcos if $ collapse, gold n silver may surge more than ten times as history suggest!

      Just my humble views and hope it helps.

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