Layoffs and War in Iraq Cause Concern about Financial Security; American Express Financial Advisors Offers Financial Tips for Wary Workers.

Business Editors

MINNEAPOLIS--(BUSINESS WIRE)--April 7, 2003

On Friday, the government announced a total of 108,000 job losses during the month of March. Although the number was less than February's reported job losses of 308,000, the biggest one-month loss since October 2001, March also brought the beginning of the war with Iraq and a jumpy market. One event can be troubling but the two combined can be devastating for American workers.

How well workers are able to adjust financially to any interruption in income is crucial to their financial and personal well-being. American Express Financial Advisors offers tips for the newly unemployed:

-- Assess financial position - Review assets and liabilities -

this is an important first step.

-- Evaluate liquidity - Cash flow will be important during this

time. Take note of liquid investments, such as, savings and

checking accounts, mutual funds, bonds, certificates of

deposit, etc.

-- Don't forget about your 401(k) - It is best not to draw on

retirement assets during unemployment, however, keep in mind

that any after-tax contributions made to a 401(k) are sent in

a check when you roll-over to an IRA.

-- Keep base expenses as low as possible - Monthly expenses such

as cable service or a health club membership may have to be

put on hold during this time to keep cash available for

necessary items like the mortgage and utilities.

-- Defer loans - Some loans, such as student loans, offer

deferral of payment during periods of unemployment which keeps

more cash on hand for everyday expenses.

-- Maintain benefits - Set aside money for COBRA benefits to

guard against possible medical bills that will have a major

impact on finances.

-- Apply for unemployment - This allows cash flow to continue and

may be required for certain loan deferrals.

-- Keep records of job hunting expenses - Some expenses

associated with finding a job can be deducted. Although this

won't help the current cash flow situation it will help at tax

time.

-- Don't forget your taxes! - Filing an extension for income

taxes does not mean a payment can be delayed. Estimate the

amount owed and make the payment when the extension is filed,

otherwise interest or penalties will be assessed.

If you are still working, take the opportunity now to protect yourself and your family by putting away three to six months of expenses in an accessible account. If that "pink slip" comes in the mail this emergency fund could be just what you need to stay afloat until you find that next career opportunity.

Editor's note: Financial advisors are available to provide expert commentary to the media. To arrange an interview contact Ann Wasik at 612-678-1592 or [e-mail].