Ready or not, AI job loss is coming. The writing is on the wall. Discover the three ways to get your finances and career skills ready now so you’re not surprised or unprepared when AI job loss hits you. Learn from Intel Corporation and others how to make yourself “luckier” than you ever thought possible.
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Today, it’s not your brother coming to smash you. It’s machine learning and AI job loss. And no, it’s not kidding around. Soon it’ll holler, “Ready or not, here I come!” Fortunately, you have a little time to get ready. But not a lot. The time to prepare is now.
The Brookings Institute estimates that some 36 million Americans could have 70% of their work tasks replaced by robots in the next 10 years. That’s about 22% of today’s workforce hit by AI job loss. Is your job one of them?
It could be argued that policymakers should do something about this. But why leave it in their hands? In the spirit of taking control of your own financial future and not leaving it to chance, let’s focus on three ways to protect yourself and your wealth from this oncoming Mack truck. Because the truth is, there are ways to mitigate risk in every financial situation. Around that next corner, you might even come face-to-face with “Lady Luck.”
“Fortune Favors the Prepared”
“Fortune favors the prepared,” Louis Pasteur once famously quipped. And for good reason. He got “lucky” again and again. But it didn’t just fall into his lap. He actively sought it. You see, Pasteur wasn’t sitting home watching TV and flipping the remote. He spent years in training… which allowed him to spot and seize opportunity when he saw it.
In other words, “luck” was at the intersection of preparation and opportunity.
In the following days and weeks, multiple people begged to buy that odd-looking radiator. This became the inspiration for Bisque, a company that makes designer radiators. Luck stared Ward in the face. It took several offers of purchase to make him wake up to it.
How “Luck” Made Intel a Phenomenal Success
Fast forward to a more contemporary example – Andy Grove, former CEO of Intel. Intel had a fascinating early story of constant innovation. But they also had many detours on the road to fame and fortune. During the 1980s Intel created microprocessors, with a long list of possible applications. But they marketed their product to smaller users.
As the story goes, IBM came banging on their door wanting Intel microprocessors. Intel finally said, “Okay, then, you can put our product in this thing you call a PC.”
Like Pasteur, Intel ran tons of experiments. Most of them failed. The successes were won with blood, sweat and tears. But when “luck came knocking” Intel was smart enough to recognize it and plunge.
How Fortune Can Favor YOU — If You Start Now
So yes, fortune favors the prepared. Here are three ways you can be sure you’re prepared for your lucky break and won’t be struck down by AI job loss. Any (or all) of them could make a huge difference in your financial future. Pick one or more and start today.
1. Build Your Hedge of Protection Against Potential AI Job Loss
Whether the school of hard knocks comes calling in ten years when AI job loss hits, or today in a pandemic and global financial meltdown, you need to be ready. Remember, fortune favors the prepared. You do yourself no favors by being unprepared when the shakedown comes. And it’s sure to come.
Your Personal Hedge of Protection Against AI Job Loss
Your first priority today should be to build a hedge – even a fortress – of protection around yourself, your family, and your assets, in case of AI job loss or any other type of calamity.
We recommend at least six months’ (and preferably 12) of your routine expenses in a contingency fund. Or have some other way to access cash, should the bottom drop out of the economy at large or your personal economy. A rainy-day fund, if you will. Whatever you call it, it should be a very high priority today if you haven’t done it yet. It can literally keep you afloat when the bottom drops out. It’s your proverbial get-out-of-jail-free card.
To calculate how much you should have stashed in case of AI job loss, figure out how little you could live on if you really had to. What do you need to put basic food on the table – rice and beans, not steak and wine? You could probably unplug the cable and read books or play board games. Other activities can be cut.
Calculate what you can honestly get by with on a monthly basis, multiply by 12, and aim to set aside that much in a safe “parking place” just in case. Factor in any debt repayments, including student debt.
On a related note, and of utmost importance… reduce your debt. If you snowballed your payments could you cancel out your debt in the next year? See how to do that in our article on slaying debt fast.
Repaying debt automatically reduces your monthly living expenses by the amount of each debt’s monthly payment.
Watch Out for Downstream Marketplace Influences
In 2007 and 2008 I owned a large piano teaching school in metro Detroit. As the automotive “Big 3” cut jobs, real estate crashed, the financial crisis unfolded, and people stampeded for the exits. Since I was “non-essential” to families’ budgets, I was one of the first to fall. You don’t have to directly work in an at-risk industry for the downstream effects to hit you hard.
Where to Stash Your Emergency Fund
Make sure you can easily convert this “hedge” to cash without early withdrawal penalties. Shop nationally if you want the best interest rates on this money. Sure, interest rates are not your primary goal, but why not maximize your return. An automated savings program helps promote self-discipline. You won’t miss what you never even see.
2. Upgrade Your Skills Before AI Job Loss Strikes
“Author Harvey McKay wrote a book called, “Dig Your Well Before You’re Thirsty.”
It’s a great read, primarily a book about networking. And about forging relationships before you need to ask for a favor, a referral, or some other form of “relationship capital.”
But the same principle applies equally well to upgrading any skill or training before you need them, i.e., before an AI job loss. There are big benefits to upgrading them now before you really need them:
- You’ll learn things a lot faster and better when you’re not stressed about lack of income.
- It could set you up for a job promotion at your current job.
- Your employer might even pay for your training. (Ask. Or consult your HR manual.)
- You’ll grow your personal/professional network.
- It’s far more productive than watching TV.
What’s more, there’s a famous statement that declares, “Education is the only thing that no one can steal from you.”
Today, educational opportunities are more available than ever before. You have Udemy classes on sale for $10 to $20. Many college courses are offered online. Even if not offered for credit and you need to get credit, you can learn the content and take a CLEP test to prove that you know it and get college credit for the cost of the test.
All this means you don’t even need to drive down to the community college and take classes on their schedule if you don’t want to. You can acquire new skills online for free or next to free, on your own schedule or on demand, these days. There’s hardly any excuse for not continuing your education in virtually any field of study in 2020. You can upgrade your skills to prepare for a potential AI job loss almost any time for a very small amount of spending.
Why Billionaires and Millionaires Are Brashly Unafraid
Many billionaires claim that if they suddenly lost everything overnight, they’d rebuild. They say it with great confidence, because they’ve already developed the skills needed to become successful. It’s stored up in their head, and in their text and phone list. You, too, can gain that sort of confidence by learning new job skills.
What are some skills that fit with your unique gifting and relate somehow to what you already know? Look for classes on Udemy, or online college courses you can take for (almost) free. Find someone to mentor you. With the internet, your options today are nearly infinite.
Millionaires Have How Many Streams of Income?
Studies show that millionaires have seven income streams on average. Now that obviously doesn’t mean seven jobs. There aren’t that many hours in a day.
But consider a side hustle. Some side hustles become full-fledged businesses in their own right. Others aren’t really scalable. Some can be done from home, making them ideal side hustles for moms. Just because it’s not scalable or can be done from home doesn’t mean it’s worthless. Far from it.
You bring in cash, learn new skills, expand your network, and widen the “moat” around your financial house. Smart people know they can leverage one side hustle into another. It’s not just one-and-done.
Look for Your Acres of Diamonds
Dig for opportunities. Find your acres of diamonds. Rinse and repeat.
If you choose side hustles related to your natural gifts and abilities, side hustles can be a real hoot. And build your financial moat, to boot! Today is the day to get started. If you’re broke right now, double down. Reduce debt and build up your one-year reserve.
If possible, build your skills at the same time. Ask your boss for a raise. (We’ll talk more about that more in a future article.) Do whatever you can to boost your earnings. The TV is your enemy. Turn it off.
If you have enough extra cash to find your first customers with a side hustle without spending money you don’t have, do it today. Do that, and you’ll reduce your dependence on that soon-to-be-obsolete skill set (stolen by AI) while boosting your financial well-being.
3. Start Your Own Side Hustle — A Terrific Prep Tool for AI Job Loss
Millions of jobs as we know them today (2020) will be gone in ten years. In fact, many as we knew them six months ago are gone. Fortunately, the Internet has produced an ecosystem for creating good and profitable side hustles more easily than ever. The tools are right in front of and all around us. You likely have a 10-year head start if you start today.
James Altucher, author of The Side Hustle Bible, calls side hustling a way of life. I agree. It’s fun too. Lift up rocks, find hidden gold. What’s not to like? Hidden opportunities are everywhere. It doesn’t matter if lots of people are already doing something. That just shows there’s a market for your idea.
What’s more, you can use your side hustle to pay off debts and start investing. The less debt you have, the less monthly expense you have. Which means you’re that much less vulnerable should you lose your primary job.
Take an inventory of what you already love to do. What side hustle could you start to make money, or make extra money? Or what side hustle jobs could you go after? You might be able to make a side business out of something you already love doing. Try to avoid businesses where people will cancel if hard times hit.
But don’t over-think it. It’s better to take action (as economically as possible), and get something off the ground than to suffer analysis paralysis.