The Reality of Instability
In today’s world, stability is a myth and loyalty is a relic. Layoffs, mergers, and industry disruption are commonplace, and employees frequently jump ship to combat burnout or seek better pay. The result is that jobs are less secure than ever, and we must build a strong defense as fast and early in your career as you can. I’m going to talk about two important defenses near and dear to the FI community.
I worked hard to finish college, get an internship, and land my first full-time corporate job with good pay and benefits. The company was Monsanto — one of the largest, most stable companies in the U.S at the time. I was sure I “had it made” and was so proud to work there. But less than a year in, they announced a reorganization with layoffs. My team was downsized and being the most recent hire, my position was the one eliminated. I was crushed, devastated, and sick to my stomach. Fortunately, I had a good reputation there and a previous supervisor helped move me to another department until the layoffs were over. I then landed a new position on another team. While I had averted this crisis, it was a wake up call. I decided I would start building defenses for the next occurrence.
It’s now 2025, and Mrs. Ficology and I have brought 2 little FI’s into the world since then — FIcology Girl and FIcology Boy who are both now young adults. FIcology Girl is in nearly the exact same situation I was: She’s at her first professional job with a large, traditionally stable, worldwide corporation. She’s been delighted to receive this opportunity, been a hard worker, and assumed she had a stable career for as long as she wanted it. They just announced layoffs (womp, womp). While I think she’ll be fine, it’s obviously worrying her.
When this situation comes knocking (note: “when” not “if”), it can wreck your life. The rush of negative emotion can be overwhelming. I remember feeling helpless, wondering if I’d ever land another job. I blamed myself for not being good enough or smart enough. I got angry at the company for doing this to me. I felt out-of-control and totally vulnerable. I was devastated in every way. I can’t help but think that FIcology Girl is feeling a little bit that same way right now waiting to see how the layoff lotto plays out.
Here are two important defenses against job instability that are near & dear to the FI community.
Defense #1: The Financial Hedge (“F U Money”) 💰
The term “F U Money” is common in the FI/FIRE community. I don’t know who coined the phrase, but I’ve heard it most from the author of “The Simple Path to Wealth”, J.L. Collins. It means exactly what you think. Basically, you have enough money saved that at any point you can walk away and say “F U” to your employer with little to no worry. There are obviously different levels of F U Money ranging from having 3-6 months worth of expenses saved to being able to fully retire. My suggestion would be to have a minimum of 6 months of expenses saved. Hopefully you have much more than that saved, invested, and growing for you.
I can’t express enough the freedom that having F U Money gives you. It alleviates all the negative feelings of hopelessness, vulnerability, and so on that we mentioned above. It also opens up a whole world of options to you: mini-retirements, starting your own business, taking additional risks, the confidence to ask for a raise or promotion, and more. Overall, it gives you peace of mind and the ability to sleep at night. And when you have that peace of mind & confidence, it shines to everyone you encounter. People sense this confidence and suddenly start to pursue you with opportunities.
How to accumulate is, in theory, simple: live below your means and save the remainder. Where/how to invest F U Money is beyond the scope of this post; it’s a personal decision based on a number of potential variables. I would suggest having 6 months of living expenses in low-risk investment like Treasury Bills or CDs that you “ladder” so that you have a steady stream of income if needed. Savings above that should be invested for growth (equities via low-cost index funds is the FI community’s preference). Once you have more savings/investments, you may choose to have all of it, including your 6-month reserve invested for growth. Once your portfolio is larger, you may perhaps consider the entire balance as your F U Money; I certainly thought this way as I neared retirement.
F U Money = Time, Freedom, Dignity, Opportunity, and Peace of Mind.
Defense #2: The Personal Hedge (“U Capital”) 👤
Just like financial investments, personal investments (“U Capital”) are a great hedge against job instability — and they compound just as powerfully. Make investments in yourself continuously, these make you more valuable to your current employer, potential employers, and anyone around you. There are infinite ways to invest in yourself and build U Capital. Obviously investing in learning more skills at your current career will pay off well, but other skills pay dividends as well. Learning people skills is one of the biggest bangs for your buck. I can’t think of any other thing that would pay off more and across all parts of life.
Think about it — if there’s any subjectivity to who gets let go in a layoff, who is going to get let go: an employee that constantly betters themselves and gets along with everyone -or- someone who does the minimum or is a constant pain to deal with?
Here are some quick and easy tips to get started building U Capital.
- Be at work 15 minutes early and stay 15 minutes late. This small habit elevates your work reputation above 90% of your peers.
- Routinely ask your boss for feedback on how you’re doing and what you can do better. As long as you’re sincere, there’s no better way to score legit points.
- Be promotable. Don’t just expect a promotion; be the kind of person who deserves to be promoted. You demonstrate value THEN you get promoted — not the other way around.
- Encourage, compliment, and appreciate others including your superiors. All people crave these things and there are few who give them. Be someone that lifts others up.
- Don’t participate in gossip or negative talk. Course correct conversations if you can by stating the positive. If that’s not possible, exit those conversations.
- Multitask learning by listening to audiobooks & podcasts. Listen while you exercise, shop, do chores, or any menial task.
U Capital = Stability, Career Control, Marketability, and Higher Value
Conclusion: Compounding Your Defenses 🛡️
Job instability can rear its ugly head for so many reasons. Hard economic times can force layoffs. Your company could be acquired and you dislike your new owners. You may reach a point of extreme burnout & unhappiness. An accident or medical situation could make you unemployable. A new technology (like AI) could render your job obsolete. Outsourcing to another country with cheaper labor could eliminate your job. The possibilities are endless. That’s why it’s important to build a strong defense as fast & early in your career as you can.
These 2 defenses work together and complement each other. You need to have both for maximum stability. F U Money absorbs the financial shock, and U Capital minimizes your risk and ensures you land on your feet quickly and on your own terms.