Worst case scenario.

[Sam]

For those of us still working but contemplating Early Retirement in the near future. What is your worst case scenario?

That is, for whatever reason, you decide (or being forced to) quit today, at this very moment, would you make it? Or do you have to look for another job soon?

Here's my worst case scenario: Imitate "Billy and Akaisha" lifestyle. Absolutely no need to look for work ever again.

What's yours?

 

[haha]

Here's my worst case scenario: Imitate "Billy and Akaisha" lifestyle. Absolutely no need to look for work ever again.

Billy and Akaisha will be thrilled by this. Are you by chance a diplomat?

Ha

 

[Sam]

Billy and Akaisha will be thrilled by this. Are you by chance a diplomat?

Edit: I think I understand now. You're being sarcastic. And you thought that I might have offended the Kaderlis. Thanks for the head-up.

No it was not meant to offend. It was meant as a compliment, an admiration. Because of them, there exists an escape route for me, should the worst happen.

 

[justin]

I'd be looking for a new job or maybe a new career (being a lawyer is my backup plan if the current career loses its feasibility).

 

[brewer12345]

I went through the mental exercise recently. If I were suddenly out of a job, I would take a month off before even contemplaying my options. Then it would be find another job or start a business.

 

[dex]

Here's my worst case scenario: Imitate "Billy and Akaisha" lifestyle. Absolutely no need to look for work ever again.

That's a pretty good "Worst Case Scenario".

What is your "Best Case Scenario"?

 

[Sam]

My best case scenario is to retire as planned 4 years from now. Will probably live the "Billy and Akaisha" lifestyle as well, but at a different level.

 

[retire@40]

For those of us still working but contemplating Early Retirement in the near future. What is your worst case scenario?

That is, for whatever reason, you decide (or being forced to) quit today, at this very moment, would you make it? Or do you have to look for another job soon?

Looking at your worst case scenario is part of the FIRE process.

In a worst case scenario (defined as losing current earned income), I could RE right now with what I have, but I would not want to live on a slightly higher than bare bones budget for the next 40+ years.

Still, it's a good feeling to know you have enough set aside early in life so that for a few years, you could keep living the normal life you have been accustomed to living while you look for other sources of income (if you need to). The average guy on the street may have 6 months of living expenses saved while most FIRE-to-be people here may have more than 6 years of living expenses set aside.

 

[justin]

On second thought, I'd take the 6-9 months of unemployment pay and call it a "sabbatical". Assuming I got fired, and not that I quit.

 

[Sam]

while most FIRE-to-be people here may have more than 6 years of living expenses set aside.

How did you come up with that "6 years"?

On second thought, I'd take the 6-9 months of unemployment pay and call it a "sabbatical". Assuming I got fired, and not that I quit.

You are not alone thinking that. In reality, most people don't stick around just for unemployment check collecting, unless they are forced too. The amount is so small compared to their normal income that the incentive to "not work" does not materialize.

 

[Rich_by_the_Bay]

Well, as long as you're being morbid, suppose you opt against LTC insurance due to its chaotic state. Then one of you gets a chronic debilitating disease and ends up in a 70K per year nursing home. A year or two later, the other one -- now living on a small allowance, gets his or her own disease.

Or, you count on an ESRBob-style part time income stream, then become disabled, then face a severe and long bear market.

But all these scenarios are not likely, and people tend to adjust, belt-tighten and improvise. Nothing protects agains all worst-cases. I think there is more risk in over-planning for the worst case 1% scenario than there is in having sensible cushion and living a good life.

 

[Nords]

I think there is more risk in over-planning for the worst case 1% scenario than there is in having sensible cushion and living a good life.

I think there's much more risk in living one's life for the worst-case 0.001% scenario, but I think that just obsessively planning for it is an exercise that helps many ERs sleep well at night.

At least that's how it works for me. 10,000 or so posts later I'm sleeping a bit better now...

 

[bssc]

My worse case is that I get killed by a falling jet engine and our cats inherit. Anything else is gravy.

 

[retire@40]

How did you come up with that "6 years"?

It was a combination of parallel construction (6 months...6 years), an estimate based on what I remember from various polls here, and pure speculation.

 

[youbet]

Looking at your worst case scenario is part of the FIRE process.

In a worst case scenario (defined as losing current earned income),

That's a worst case scenario? Boy, lots of sheltered lives on this board I guess!! Losing a job is a worst case scenario? I thought that happened to everyone. And if that was the worst that ever happened to me, I'd consider myself one hell of a lucky guy!

It's more fun to discuss scenarios such as: you reach FIRE at 45 and hear your doc tell you that you have terminal cancer at 45.1. Or you pick up the phone and hear the police tell you that your child was killed in an auto accident. Or your spouse dies unexpectedly. You get the idea. Dealing with the loss of a job or the failure of a business requires knuckling down and replacing it. But, compared to real problems in life, shouldn't even be given a moment's thought.

Fellow posters, please don't be offended by this, but we really do lead charmed lives and most have few clues as to what "worst case scenarios" are all about.

 

[Peaceful_Warrior]

Who gets the money when the cats die?

My worse case is that I get killed by a falling jet engine and our cats inherit. Anything else is gravy.

 

[bssc]

Who gets the money when the cats die?

The remainder of the trust goes to the Humane Society.

 

[brewer12345]

That's a worst case scenario? Boy, lots of sheltered lives on this board I guess!! Losing a job is a worst case scenario? I thought that happened to everyone. And if that was the worst that ever happened to me, I'd consider myself one hell of a lucky guy!

It's more fun to discuss scenarios such as: you reach FIRE at 45 and hear your doc tell you that you have terminal cancer at 45.1. Or you pick up the phone and hear the police tell you that your child was killed in an auto accident. Or your spouse dies unexpectedly. You get the idea. Dealing with the loss of a job or the failure of a business requires knuckling down and replacing it. But, compared to real problems in life, shouldn't even be given a moment's thought.

Fellow posters, please don't be offended by this, but we really do lead charmed lives and most have few clues as to what "worst case scenarios" are all about.

I think you didn't get answers like this because there is nothing any of us can do to plan for or avoid such things. Sure, in the dark pit of a sleepless night I think about that sort of thing once in a while and clearly these are worse outcomes than loss of a job, etc. But there is no point in obsessing over it because tehre is nothing that can be done except deal with it if it happens.

 

[lazygood4nothinbum]

as i've mentioned on an earlier post, life is pretty good when your so-called worst case scenerio simply forces you into a life of adventure.

 

[Sarah in SC]

My worse case is that I get killed by a falling jet engine and our cats inherit. Anything else is gravy.

My worst case, but then the dogs sue the cats for their fair share and it gets all over the tabloids! But it is good to know that we arent' the only ones with an estate plan that includes pet care!

Sarah

 

[justin]

You are not alone thinking that. In reality, most people don't stick around just for unemployment check collecting, unless they are forced too. The amount is so small compared to their normal income that the incentive to "not work" does not materialize.

In my state, the benefit is typically 26 weeks at 1/2 your previous salary, up to a max benefit of $442 per week. Factor in much lower taxes on the benefit check, and it might not be that far off your previous take home pay.

I'd get $11500 for doing nothing for six months. Maybe double that if I could find a replacement job and work at least 40 hrs/wk. I'd choose the do nothing route (or the minimal it took to stay on the govt teat). I'd still call it a sabbatical though.

I wonder how many folks are really motivated to find a new job (quickly). I'm sure some are, especially those who are the sole breadwinners and supporting a family. I can imagine a lot of others that might not mind getting a free check every week, plus the potential for (illegal) informal employment on the side.

 

[Rich_by_the_Bay]

I think there's much more risk in living one's life for the worst-case 0.001% scenario, but I think that just obsessively planning for it is an exercise that helps many ERs sleep well at night.

At least that's how it works for me. 10,000 or so posts later I'm sleeping a bit better now...

Never occurred to me that fretting obsessively helps some folks sleep at night, but hey -whatever works for you.

But like most things, that last few percent of possible risk can consume huge amounts of emotional and financial capital. Where to cut it off and say you'll take your chances is a constant challenge.

 

[dex]

as i've mentioned on an earlier post, life is pretty good when your so-called worst case scenerio simply forces you into a life of adventure.

Good answer.

I think his "Worst case scenerio" might just be he best cast scenerio in disguise.

 

[OKLibrarian]

Never occurred to me that fretting obsessively helps some folks sleep at night, but hey -whatever works for you.

But like most things, that last few percent of possible risk can consume huge amounts of emotional and financial capital. Where to cut it off and say you'll take your chances is a constant challenge.

Everybody's got their own definition of "reasonable caution" and "fretting obsessively". I had enough atom bombs drop on my life at formative years that hoping for the best but preparing for the worst has become natural. S%*t happens. That said, I've had a spectacular life thus far and really wouldn't change most of those things in retrospect. Spending time thinking through every worst case scenario is pretty much a hardwired part of my personality, so instead of being paralyzed by those thoughts, I spend my time in risk management and planning my responses ahead of time.

And then whatever weird thing that never occurred to my free-floating anxiety will happen, I'll shrug, and improvise.

 

[retire@40]

That's a worst case scenario? Boy, lots of sheltered lives on this board I guess!! Losing a job is a worst case scenario? I thought that happened to everyone. And if that was the worst that ever happened to me, I'd consider myself one hell of a lucky guy!

Well, worst case scenario is that one could die in an airplane crash with his whole family, but if you look back at the OP's question, he put it in the context of losing your job right now and how it would affect your ER plans.

IOW, what would happen if you had no more earned income?