The government shutdown from December 22, 2018, to January 25, 2019, was the longest ever in the history of America. It was 35 days of pure misery for people working in government offices and government-funded establishments.
Departments like Agriculture, American Battle Monuments, Commerce, Defense, etc are deemed non-essential by the constitution and the government had total rights to shut them down during the last financial budgeting. The purpose of this post is to make you aware of how fragile and unreliable a government job is.
What is a government shutdown?
Lack of funding and disagreement(over budget) between political parties is the biggest reason behind a government shutdown. During this period, all non-essential government offices remain closed and their funding is transferred somewhere else.
For instance, in 2018-19, the budget for the year 2019 was falling short as a result of the construction of the border wall between the US and Mexico. Hence, the government decided to let the middle class of America suffer for 35 days. The workers worked without a paycheck for those 35 days.
Here are the 3 personal finance lessons from the government shutdown.
1. There are no stable jobs available
No matter how many warnings the government gives, there will be some people who will still believe that their job is stable and secure. This is a coping strategy that allows them to be lazy and continue to live their lives paycheck to paycheck.
The government shutdown in 2018-19 exposed the weak spots of thousands of Americans who relied heavily on their jobs to pay their bills. It’s not like they had to live without a paycheck for 6 months, it was just 35 days and they still got affected.
2. Rely on emergency funds during a financial crisis
Are you secretly afraid of running out of money and going broke one day? You are not alone. There are millions of people who do have a clear plan of what they will do if they lose their jobs.
Along with your savings account, you should also create an emergency fund on which you can rely on if things don’t go your way in the future. You don’t know when the next government shutdown will befall and the personal finance lessons you learned from the past shutdowns should not go to waste.
3. Cultivate a wide range of transferable skills
This is the most important lesson I learned from the last government shutdown. Gone are days when you could rely on one or two skills that you have to help you find a job. Most people learn their skills on the job itself. And most often, their skills are job-specific. Which means, they are only applicable for their current job.
If the unexpected is to happen sometime in the future and they lose their jobs, their current skills become useless for other employers. Hence, cultivate a wide range of skills that can be easily transferable from one job to another.
The last government shutdown lasted just for 35 days and it still shook the American economy. It massively impacted the lives of common middle-class people. Imagine what could have happened if it would have lasted longer than that. Are you prepared for the next financial crisis? If not then you better take drastic steps to become self-sustainable.