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Involuntary Class of 2013 - how to prepare
Old 11-17-2012, 02:22 PM   #1
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Involuntary Class of 2013 - how to prepare

All my calculations and FIRECalc says I have about 5 more years until I'm really FI, and it's very hard not to want to jump that time table and FIRE immediately.

In the last two weeks, 2/3 of the VPs level have voluntarily left our company, giving up all their equity and stock options to do so (clawback). Our usual quarterly briefing on company status was positive as always, but they didn't include any numbers which is unusual. We have been told to expect zero profit sharing bonus this year. All our hiring is on hold, except an offshore contracting company we sometimes use is staffing up for a new project.

Any one of these things might be no problem, but taken together this may be bad news. As an older technology guy, I have been very successful finding new work with people I know from old jobs, but have a hard time even getting an interview with people I don't know. (Yes, I've had my resume reviewed by trusted hiring manager friends. It's fine.) Ordinarily, I would take these events as a sign I should dust off my resume and start looking, but this close to FIRE and anticipating even more difficulty than before, I'm not so sure.I want another job or the hassle of finding one.

I think my options are:

1. Look for a new place to land
2. Stick out here as long as I can, then deal with it
3. Prepare for possible earlier than expected FIRE

These aren't mutually exclusive options and right now I'm actually doing all three. I'm running all my scenarios through FIRECalc, to see what FIRE earlier than I planned would mean. If I do FIRE, I'll need to have a plan for health insurance. I'm piling up cash in case I need to cover expenses during a job search. I'm starting to contact old co-workers to gauge the possibility of finding work. I'm stepping up my exercise program, so I physically feel great. What else should I be doing?
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Old 11-17-2012, 03:08 PM   #2
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For a brief moment, I thought OP worked for me. I am still not 100% sure he does not.

For what it is worth: I am also doing all three although fairly passively...
  1. Freshening my network/contacts in case something comes up that is lucrative and interesting.
  2. Gritting my teeth and continuing to collect the paychecks as long as they come.
  3. Cutting expenses such as leisure travel to give me more of a cushion, much to the annoyance of my family. (My spreadsheets say I should be fine now; but, I do find the idea of RE quite frightening now that it has become a realistic option for me.)
I have posted before about the benefits of consulting in the IT arena; I am assuming that both OP and I have some odd combination of skills/experience that will be valuable to someone if we do need additional income.
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Old 11-17-2012, 03:18 PM   #3
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I would do all 3 as well with emphasis on 2, 1 and 3. many times, even if a company is financially troubled they still need to operate and get things done, so it may be possible to just hang in there, grin and bear it - sometimes opportunities that would not have arisen in the normal course of business arise as others jump ship.
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Old 11-17-2012, 05:36 PM   #4
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OP might be a bit confused. Early Retirement (RE) only makes sense if you're FI (Financially Independent). Retiring early is always possible, but could involve a drastic lifestyle change. When you become FI, then RE is easy.

The advice from CoolChange and pb4uski above is excellent. Just don't confuse FI with RE.
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Old 11-17-2012, 06:10 PM   #5
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Quote:
Originally Posted by growing_older View Post
All my calculations and FIRECalc says I have about 5 more years until I'm really FI, and it's very hard not to want to jump that time table and FIRE immediately.

In the last two weeks, 2/3 of the VPs level have voluntarily left our company, giving up all their equity and stock options to do so (clawback). Our usual quarterly briefing on company status was positive as always, but they didn't include any numbers which is unusual. We have been told to expect zero profit sharing bonus this year. All our hiring is on hold, except an offshore contracting company we sometimes use is staffing up for a new project.

Any one of these things might be no problem, but taken together this may be bad news. As an older technology guy, I have been very successful finding new work with people I know from old jobs, but have a hard time even getting an interview with people I don't know. (Yes, I've had my resume reviewed by trusted hiring manager friends. It's fine.) Ordinarily, I would take these events as a sign I should dust off my resume and start looking, but this close to FIRE and anticipating even more difficulty than before, I'm not so sure.I want another job or the hassle of finding one.

I think my options are:

1. Look for a new place to land
2. Stick out here as long as I can, then deal with it
3. Prepare for possible earlier than expected FIRE

These aren't mutually exclusive options and right now I'm actually doing all three. I'm running all my scenarios through FIRECalc, to see what FIRE earlier than I planned would mean. If I do FIRE, I'll need to have a plan for health insurance. I'm piling up cash in case I need to cover expenses during a job search. I'm starting to contact old co-workers to gauge the possibility of finding work. I'm stepping up my exercise program, so I physically feel great. What else should I be doing?
Good, I'm glad you are doing all three and building up your cash and exercising.

While you very well may be able to find another job, on the other hand I wouldn't bet my life on it in this economy. Keeping that in mind, I'd figure out what sort of budget would be sustainable for the rest of your life, starting now, if you cannot find other work.

Then I'd do everything possible to try to live on that budget, no matter how small, starting right now. The excess can go into your nestegg, naturally. Your decisions will be so much easier once you find out the results of this experiment.
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Old 11-17-2012, 06:36 PM   #6
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Quote:
Originally Posted by growing_older View Post
All my calculations and FIRECalc says I have about 5 more years until I'm really FI, and it's very hard not to want to jump that time table and FIRE immediately.
Any one of these things might be no problem, but taken together this may be bad news.
I think my options are:
1. Look for a new place to land
2. Stick out here as long as I can, then deal with it
3. Prepare for possible earlier than expected FIRE
What else should I be doing?
4. I'm not sure about this "five more years until you're really FI". You're either FI or... you're not. How much less of a "just one more year" safety buffer are you willing to accept?

5. What's the minimum buyout or layoff package that you'd need to make the leap to Class of 2013?

We've had several long-time posters who have been close to FI (or who've been biding their time for some other reason) and then have been "pleasantly surprised" by a layoff.

A few of them were able to privately share their plans with a trusted boss, but most of them kept their mouths shut in hopes of being laid off before they decided to announce their retirement plans.
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Old 11-17-2012, 06:54 PM   #7
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Quote:
I'm not sure about this "five more years until you're really FI". You're either FI or... you're not.
I have a lifestyle I like and am living now. It's below my means and allows me to save fairly aggressively for FI. About 5 more years of this and I will be FI and able to live that lifestyle in retirement (or keep working, haha). I interpret this as I am not-FI for now.

I'm working on the possibility of trimming down that lifestyle in possible scenarios, as well as accepting a higher SWR in funding my current lifestyle - and of course combinations of the two. I will be crunching numbers and see what I find.

And maybe my spidey-sense that is something concerning here is overreacting. Maybe I can keep to my 5 year plan and everything will work out as I hoped. Not all my previous plans and expectations did work out, so I'm trying to get ahead of this one and anticipate what I need to do in case I retire unexpectedly in the next few months. I do have quite a few older family members who "retired" when they couldn't find new work, which has always been one of the motivations to save aggressively to reach FI at an early age. I believe it can happen when you don't expect it, as well as when you do. I'm looking at new FIRECalc scenarios. I'm looking at Health Insurance options. I'm investigating other work possibilities, while not burning any bridges where I am. Anything else I should be doing?
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