The investment industry can be volatile, and investment salaries often fluctuate during times of economic upheaval. However, by preparing financially and having a backup plan, investment professionals can better weather salary changes. Multiple factors drive investment salary trends, including fund performance, deal flow, and market conditions. Building an emergency fund, having strong health insurance, and constantly upgrading skills are key ways to handle investment salary volatility. Investment professionals should also be transparent with employers about side income and be ready to transition between roles.
Keep 6 months of living expenses in an emergency fund
Having 6 months of living expenses set aside in an emergency fund is critical for investment professionals. Market downturns often lead to layoffs and salary reductions. With adequate savings, expenses can be covered during periods of unemployment. An emergency fund prevents investment pros from tapping longer-term savings or retirement accounts. Start by automating deposits into a high-yield savings account each month. Gradually build up the balance over 4-6 months. For those in high-risk roles, have 9-12 months of expenses in safe assets.
Get comprehensive health insurance
Don’t rely solely on employer health insurance. Purchase standalone policies to cover gaps. Ensure all immediate family members have robust coverage, especially those over 40. As medical costs rise, increase policy limits and consider supplemental insurance. Comprehensive health insurance prevents investment pros from draining retirement savings on medical bills if laid off.
Constantly upgrade job skills
Investment pros should continually upgrade their skills and experience. Take courses to gain certifications. Reconnect with your professional network frequently. By enhancing capabilities, investment professionals open new job opportunities and improve job security. Some easy ways to upskill include learning new data analysis tools, studying adjacent sectors, and improving soft skills like communication.
Have a backup income stream
A side gig provides an alternate income source in case of job loss. Taking on part-time work not only helps build savings, it expands professional connections. But ensure any side income doesn’t violate employer policies. Be upfront about moonlighting activities rather than risking termination.
With preparation, investment professionals can manage fluctuations in compensation and employment. Building emergency savings, getting health insurance, upgrading skills, and having backup income sources help smooth salary volatility. During economic upheavals, investment pros who take proactive financial steps and keep networks active better weather storms.