What Is Contingency?
Contingency is an event or a situation that might happen in the future, especially one that could cause problems. A contingency in a contract addresses problems that may occur in the future, which must be planned for now even though it is not a certainty, or there is a probability that it will happen.
Contingency is planning for a possible future problem. For better illustration, if you are renovating a building, you get quotations from tradespeople for all the proposed jobs, add the costs up to give you a total cost for the job. Then you add at least 10% if a problem arises that needs more money; the 10% is your contingency. A contingency does not always have to be money. For instance, you may be planning a long trip that entails changing from one flight to another or from one train to another. What happens if one is late, so the other has already left? You work this out beforehand and make a provisional booking at a hotel. That is a contingency.
Many older people believe education is the best legacy and often advise the younger generations to go to school. Nonetheless, due to the high unemployment rate facing most societies, many youths prefer to acquire digital skills such as graphic designing, content writing, web designing, etc. Non-digital skills such as fashion designing, body beautification, etc., have been in high demand too.
These days, most students combine schooling with skill learning. They are simply putting contingencies in place if there is difficulty securing a decent job after school. It can be devastating if one spends a considerable number of years in school but finds no job afterward. However, it would be somewhat bearable if one had learned a skill or two that could allow one to start a side hustle.
For quite some time, a famous commercial bank has been in the news owing to a sizable amount of money it owes a corporate establishment. They have been to the court severally, and there are rumors that the corporate establishment will likely take over the bank. It was not much of a shock when the bank changed its name, a contingency plan designed to make the take-over unattractive or outright impossible because the bank’s popularity hinged on its name.« Back to Glossary Index