Can you still secure the bag working in tech?

Random personal fact about me Reader, I was able to triple my salary by moving into tech and growing my career.

Real estate and investing have been a huge part of my wealth story, but nothing beats the quick and fast accumulation of salary after grad school.

My experience has led me to recommend and coach others on finding a career in tech and encouraging others to maximize their salary. Whether it’s tech or some other high-paying profession … a large income can be life changing.

But a quick look at the website shows a different hiring environment. Meta, Amazon, Cisco, Uber, Twitter (oh man, Twitter) and many more have all seen layoffs in the thousands. With a lot of layoffs, trust that pay and benefits will go down too.

The real question becomes, if this recession comes to your home and you get laid off, are you prepared?

High Salary, High Volatility

I remember one year, while working at Facebook, looking at my tax return and thinking “Damn. Only a few thousand more, and I would have earned $1,000 a day. I love America!”

For many of you, this may be unimpressive or just another job. As a young man and the son of immigrants, I finally realized why my parents left the warm sun and beaches of the Caribbean for the cold streets of New York so many years ago. I was floored by how much my salary had grown over the last four years.

But it wasn’t smooth sailing getting there. Just a few years prior, in 2013, I found myself being called into the office by my boss to be laid off. Only one year after graduating from MIT (with the loans to match) and one year into my new marriage.

I was so excited for my first startup, with stock options to make me a millionaire. The reality was a year of 12 hour days and working weekends, then getting laid off right before my one-year anniversary. Since I didn’t work for a year, I didn’t get to keep any of my stock options. They ended up being worthless anyway.

I’ve always been good about securing a great job. I treat interviewing as a life skill, and salary negotiations are as important to me as learning to balance a checkbook. Right after getting back from my internship at Zynga, I immediately got to work securing a full time job. I wanted my last semester to be full of fun and drinking.

I landed that job at a competing gaming startup. In addition to finally becoming a six-figure earner, I negotiated a ton of stock options and a $25K signing bonus. I immediately flew to DC and bought a table for me and my friends 🤷🏾‍♂️.

While I was able to bounce back from that layoff, it taught me something about high-paying jobs, especially working in tech. They can disappear overnight, so I better stay ready.

How to be prepared for a layoff

I was inadvertently taking the steps to prepare to be laid off without knowing. And now knowing the fickleness of corporate jobs, it’s pragmatic to remain prepared for another.

First thing to realize is that the best time to prepare for a lay off is when you’re employed.

Once it’s happened, it’s too late.

Tip #1: Do your f___ing job

I can’t count the times I’ve been so irritated at work I wanted to rage quit. But in the back of my head I was thinking “but I want this paycheck”.

If you know getting laid off would be terrible for you right now, show up at work. Don’t try this “quiet quitting” BS (sorry, I’m old school). You work, get promoted, get bonuses, and earn your FU money, especially when you can’t afford to be “quietly fired”.

Tip #2: Keep an Emergency Fund

I, along with anyone anywhere who talks about personal finance, have told you that you need 3-6 months of liquid access to cash in case of an emergency. I won’t belabor the point.

What I will say is, if you have significant net worth and assets, it’s OK if this is access to debt. I keep cash waiting, but I also have HELOC (home equity line of credit) and margin accounts I can tap immediately at low interest rates. I don’t like the idea of my cash not being invested, so I keep some of my reserves in backup credit lines. If you struggle with money, keep the cash and don’t get into trouble.

Tip #3: Always be recruiting

You should try and keep an updated resume on file at all times. Your LinkedIn profile should be your best professional representation. You should accept the calls from recruiters every few months to know your worth and how you stack in the market. Talk to people in your network, understand who is hiring and who isn’t. Reach out to people at companies you admire. Go to industry events.

And invest in interviewing. As a product manager interview coach, I constantly see how quickly we lose our skills at interviewing. Don’t think of it just when you want to get a job, spend the time to keep the skills sharp and practice on companies, at least once a year.

Not only will you be prepared for a layoff, but you’ll be prepared to get a better job and increase your income also.

Tip #4: Keep an emergency budget and plan in the back of your mine

If you lost your job tomorrow, what expenses could you cut without thinking about it? How much money would you need to survive?

You should always have a loose emergency plan brewing. Can you downsize your apartment? What about selling a car? Gym membership you could get rid of? Parents you can relocate with? Can you live off your partner’s income?

Thinking about this now can save precious time later when every week is burning your severance.

Tip #5: Start a side hustle, ideally that covers your emergency budget

I love side hustles. They can be a place to learn important skills, and the additional income can accelerate saving and wealth-building goals.

But side hustles often bring in crucial income when the main hustle goes away. I think owning rental properties is the ultimate side hustle, but there are so many options in the gig economy I won’t repeat all the types when Google can do a better job.

If the side hustle puts your safety in the main hustle at risk, please reference Tip #1.

Layoff suck, but not always

Getting laid off led me to triple my salary with a much better job. It also gave me the wealth mindset to turn that new salary into net worth, to be used to buy me freedom from work.

And if you prepare and never get laid off … you’ve just unlocked a little bit of flexibility if you need a three-month sabbatical or want a year off to be with your child. My preparation let me take time, move my family abroad, and really enjoy my son’s first few years.

It’s just pragmatic to be ready.

- Damien Peters

P.S. I was honored to be featured in ACRES, a coffee book highlighting 25 black real estate investors and their story. For every copy purchased, you’ll be supporting our growing newsletter.