 How do you handle the immediate financial pressure of a layoff? This was a really good question that I got over on YouTube. In response to my layoff video, Richard Tafoya asks, I'd love to hear more about where you find yourself financially at this transition point. For instance, could you comfortably live on just content revenue? And if not, do you have a lengthy runway to sort things out in terms of saving and severance? I'm a huge fan of bold money questions like this, so I really wanted to answer it first. The easiest part of the question to answer is content revenue. I have not committed to any single platform enough to generate any content revenue from it, with the exception of Egghead, where I have a handful of courses that kind of drip like maybe $100 a month. So that leaves us with the savings discussion, which we'll spend the bulk of our time on and I'm gonna use TL Draw to illustrate it. One of the most powerful financial tools that we've experienced is an emergency fund. And it's designed specifically for times of insecurity, no income, et cetera. So I think of income as filling buckets of money. The first bucket of money that you have to fill are your basic needs. These are gonna be food, shelter, and in the U.S. insurance, called this basic. Now, as you fill this bucket up, you kind of progress into this next bucket, which is maybe lifestyle, we'll call it. These are things that might actually facilitate in you making money, so like a car or a phone. And better food. From there, we kind of go into a nice to have category. We'll make this yellow, we'll just call it nice. These are things like vacation, drum lessons, cool stuff. Let's be honest, let's call this great food, really good food. And finally, we'll have the green category, which is what I think of as wealth, savings, investments, and hobbies. Now, I think hobbies is kind of like distributed between these two, but you get the idea. Now, as you build your income, some of these may be inaccessible to you. So in the first years of my career, this is kind of what it looked like. We were literally just getting by with the basic necessities, romans and casseroles, et cetera, et cetera, et cetera. And as we increased our income, we were able to fill in the other buckets. So let's talk about income for a second. Income is your tool for actually putting money into these buckets. So we'll put a cloud right here and call this job. First, it fills the first bucket and as you grow your income, it starts to fill the second buckets, third buckets, and more buckets. What happens when this goes away, suddenly in the case of a layoff? Now, this is where the concept of an emergency fund comes in. So for me, I'm looking for an emergency fund that can quickly be swapped out with my job. And filling this emergency fund is part of this nice to have wealth building income phase. You wanna start putting money away for a rainy day. In the case of a layoff where my job goes away suddenly, I want to be able to put this emergency fund into place with a strategy for which buckets that I wanna fill. Now, part of the challenge with losing a job suddenly is that you're probably filling as many of these buckets as you can. And it can be really stressful to decide what makes the cut, what do you change, how quickly can you change it, et cetera. And this is our practical strategy for that. We have planned three months of emergency fund that will cover everything. That three months is a pretty important number in terms of a layoff or a business collapsing, whatever. Because it's gonna take you about a month just to go through all of the paperwork and everything required to get out of the previous situation. And then it's gonna take you another month to get into another situation, whether that be going through interviews or asking around in your network, et cetera. So you kind of want about three months of buffer where nothing in this changes at all. So practical examples of this. When my income stops, we start putting money in from our emergency fund. All the basic stuff is covered, but then also anything that we had planned like maybe a weekend getaway with friends or a trip to the zoo or a date night, all of that stuff can still carry on for three months without just really thinking about it or stressing out about it too much. And this is like really important kind of mentally and emotionally to be able to have the freedom to take that time. So for three months we have the time to process and kind of make our decisions based on what the next few months are gonna look like. As that time progresses on, let's say three months turns into four to six months. Well, then we start kind of shrinking down the outflow of this emergency fund. So here I'm gonna say month three to six. This is where we have to start making some cuts. So maybe we say, okay, so anything that's like a really expensive hobby, giving, et cetera, you know what? I totally forgot giving, generosity. That's an important thing. All those things, if I'm not making money, these things kind of have to stop at some point. So for the first three months we can carry on. For three to six months, we really have to start making some cuts. And then this kind of goes on and on. So if we go then from six to nine months, well, then that starts to really cut into our nice to haves pretty seriously. And we're getting back to this basic territory and I'm really starting to stress out if I'm being honest. So yeah, that's the emergency fund. We've used it several times. I think it's incredibly important to generate this. I realize that it's not an easy thing to do. And to be honest, we stayed in those phases of like just basic living for a really long time to fund this opportunity. But I really do think of it like from a technical perspective as like a backup of your data or your photos or anything that's important to you. It's worth the investment so that you can buy yourself the mental space and clarity and freedom to not have to think about things until you're ready to think about them. Now I will say this, we did end up getting two months of severance which really does help especially with increased costs. So in the US, a lot of times you'll end up on Cobra which is an extension of your insurance but you'll pay for that and it's crazy expensive. Severance helps with that but also, severance is most nice for being able to give you access to money should you have options available to you from your previous employer and should you choose to buy them. Most people really don't disclose their severance numbers. So it's really an unpredictable thing so I wouldn't plan on getting severance but it is a nice to have and could either extend this or again help with purchasing options that you may not have had liquid assets for. I really do hope that helps and if you have other questions about this process I'm trying to be an open book about how I'm thinking about it so I love questions about money and where we're at, et cetera. If you wanna see the video about me announcing my layoff and kind of what we're doing for the next month as we look for jobs, et cetera, that's gonna be right here and yeah, I'll see you in the next one. Bye.