How to Manage Family Financial Commitments After a Retrenchment

Recently, I met a pretty lady who is a housewife, and her husband is a corporate guy earning enough to support their two children.

They adopt an elite-like education approach and have enrolled their children in various talent classes, such as piano, mental abacus, and karate. Like most parents, their children also attend tuition classes to enhance their academic performance.

They intend to and can afford to provide a decent upbringing environment for their children. To others, they are the ideal family prototype because they have a hardworking husband, a caring wife, and two lovely and polite children.

However, things changed when her husband was retrenched.

Her husband did his best to find a new job as soon as possible, but few opportunities could match his existing compensation package. Worse still, given the extensive interview process adopted by some companies, he couldn’t start a new job right away, even though he was willing to compromise on the salary.

They have some savings and anticipate needing to rely on them for the first six months. The positive side is that they’re ready to face the hardship together.

The children suffered quite a mental shift because the mother is teaching them to count every penny before spending.

Although they tried their best to cut down unnecessary expenses, such as visiting fancy restaurants less often, cancelling overseas trips, reducing spending on clothes and food, and even cancelling some enrichment classes, they still have countless commitments to fulfil.

Below are a few examples of their fixed expenses:

• Life insurance for both husband and wife

• Saving plans for their children

• Critical illness plan for the family

  
  

They also invested in Fixed Deposits and Bonds, and the good news is they can withdraw some funds without incurring any penalties.

There are many families out there experiencing the same dilemma, transitioning from being self-sufficient to tightening their belts while still needing to fulfil their existing commitments.

Here are a few pieces of advice for us:

Now, some insurance policies include retrenchment benefits, which allow us to defer premium payments for a certain period while still enjoying coverage.

They should not be overly protected: According to MoneySense, we should seek protection following these guidelines:

▶️ Death & Total Permanent Disability: 9x annual income

▶️ Critical Illness: 4x annual income

▶️ Spend at most 15% of income on insurance protection

The family should have long-term investment plans for their financial planning. While savings plans, fixed deposits, and bonds are capital-guaranteed, they generate minimal returns, just enough to hedge against inflation. They are meant to save and guarantee your capital, not to augment your wealth. A part of their savings should be used to invest in capital gain funds, and when they need money in dire times, they can switch to dividend funds to collect monthly dividends. Since we have been working for money, we should let it work for us too.

我近来和一位漂亮的家庭主妇唠嗑，发现她的丈夫，一名企业员工，被裁员了。

以往他们采用了精英式的教育方式，给孩子们报了各种才艺班，如钢琴、心算和空手道。像大多数父母一样，他们的孩子也参加补习班以提高学业成绩。

他们打算并且有能力为孩子们提供一个良好的成长环境。在别人看来，他们是理想家庭的典范，因为他们有一个勤奋的丈夫、一位关爱孩子的妻子，以及两个可爱又有礼貌的孩子。

然而，事情在她丈夫被裁员后发生了变化。

她的丈夫想尽快找到一份新工作，但很少有工作能够匹配他原有的薪资待遇。更糟糕的是，由于某些公司采用了冗长的面试流程，即便他愿意在薪资上做出让步，也无法马上开始新的工作。

他们有一些存款，预计需要在最初的六个月内依赖这些存款。万幸的是，他们已经准备好一起面对突如其来的困难。

尽管他们已减少不必要的开支，比如减少去餐厅的次数，取消出国旅行，减少衣物和食物的开销，甚至取消了一些才艺班，但他们依然有很多固定的财务承诺需要履行。

以下是一些他们固定开支的例子：

• 夫妻双方的寿险

• 为孩子买的储蓄计划

• 家庭的重大疾病保险

• 他们还投资了定期存款和债券，值得庆幸的是，他们可以在不交罚金的情况下提取部分资金。

很多家庭都面临着类似的困境，从自给自足转变为勒紧裤腰带，同时还要履行现有的财务承诺。

以下是我给的几条建议：

现在，一些保险政策已包括裁员保障，这允许我们在特定时期内享受保障的同时延期支付保费。

我们不应过度保护：根据MoneySense的建议，我们应按照以下标准来寻求保障：

▶️ 身故及全残保险：年收入的9倍

▶️ 重大疾病保险：年收入的4倍

▶️ 应将收入的15%以下用于购买保险

家庭应有长期的财务规划。尽管储蓄保单、定期存款和债券是有本金保障的，但它们的收益非常低，仅能对抗通货膨胀。他们应将部分储蓄用于投资增值基金，当需要资金时，可以转为股息基金以收取每月分红。既然我们一直在为钱工作，我们也应该让钱为我们工作。