other-midlife-crisis...

[Aiming_4_55]

I have a few uncles/close friends that lost their jobs in their 50's and never was able to replace with what in my mind would be a reasonable replacement. After unemployment benefits ran out, several actually took a 50 - 60% paycut for healthcare benefits and some cash flow. I don't blame them, but that sucks.

It is one of my concerns as I'm in my early 40's, close to the ceiling of my salary range of current position, but with FI within 4 - 6 year reach.

Anyone else encounter or have this as a concern in pursuit of FIRE?



"When planning for retirement, many Americans think about their pay the way they used to think about the value of real estate or stocks: that it will always go up.

They are mistaken. It turns out that the average person's pay plateaus in his 40s, according to the latest data from the U.S. Census Bureau. Many people also assume they will be gainfully employed until the day they turn 65, or 62, or whichever age they plan to retire--but if they lose a job in their 50s, finding another at the same salary is difficult."

full article...
other-midlife-crisis-wsj: Personal Finance News from Yahoo! Finance
other-midlife-crisis-wsj: Personal Finance News from Yahoo! Finance

 

[chinaco]

...
They are mistaken. It turns out that the average person's pay plateaus in his 40s, according to the latest data from the U.S. Census Bureau. Many people also assume they will be gainfully employed until the day they turn 65, or 62, or whichever age they plan to retire--but if they lose a job in their 50s, finding another at the same salary is difficult."

...

Yes, most plateau unless there is a supply/demand imbalance.

After one plateaus, the next step is to seek a promotion or more responsibility (e.g., management position).

 

[W2R]

The possibility of ending up unemployed or underemployed during later years, provides a good reason to plan for early retirement even for those who aren't sure they are ready to retire yet.

Once financially independent, one can work for the fun of it until it isn't fun any more, or until the job runs out, and then retire.

 

[Texas Proud]

I took a 30% cut when I got laid off a few years back....


BUT, I also have shaved an hour off my daily commute which makes up for that a bit... both jobs were/are easy for me, which is boring as there is no challenge what so ever...

I have decided that easy work and short commute is what I want in life now... so I am happy where I am...

 

[flyfishnevada]

I have decided that easy work and short commute is what I want in life now... so I am happy where I am...

I find I like no work and no commute

It might not be the same everywhere, but in my old job the pyramid structure of management made it likely you would top out in your 40's. Only a few positions to be promoted into and since I was in government and most of us were "trapped" by the golden handcuffs of our pensions, leaving wasn't a real option. On the other hand, if you were smart, you could get out early and lay offs aren't very common, though they should be more common.

I just took my pension and left.

I'd guess that if you're only 4-6 years from FI you could probably be FI right now if you worked at it. Every year you get closer the easier it will be. Unless your in major catch up mode, I don't know if you should be all that worried. I'd think you're ahead of the curve.

 

[REWahoo]

The possibility of ending up unemployed or underemployed during later years, provides a good reason to plan for early retirement even for those who aren't sure they are ready to retire yet.

Once financially independent, one can work for the fun of it until it isn't fun any more, or until the job runs out, and then retire.

+1

When I really got interested in saving and investing at age 31, it wasn't to be able to retire early, it was to hedge against un/underemployment as W2R says. It wasn't until later I realized once I got to FI that I could also RE.

 

[FinanceDude]

+1

When I really got interested in saving and investing at age 31, it wasn't to be able to retire early, it was to hedge against un/underemployment as W2R says. It wasn't until later I realized once I got to FI that I could also RE.

One of your best posts ever!

 

[Aiming_4_55]

Thanks for the comments thus far.

I was/am in management (Mgr, Sr. Mgr, Director roles depending on which department I represent) and earn a fair/good salary. I did take a lateral position 18 months ago for family reasons and it was/is right for me/us. Personally, I don't need any more titles... just DH and Dad are fine. No regrets.... may be a little as I miss out on the Corporate paid fancy lunches, but my waist line doesn't need it.

While the stress was reduced, a different type of stress was created. I'm a telecommuter now and feel the limited exposure can hurt promotional opportunities or increase potential lay off situation (just a personal concern). But I've been able to save extra $$ as a telecommuter as they reimburse for internet, phone, cell phone service and reduction of gas/car insurance expense translating to about $500 a month.

I truly value my extra time at home, almost 3 hours extra daily for personal/family time. Heck, I just finished lunch with DW and kids, and took a short walk around the block with my daughter. She wanted to tell me about her annual physical and shots needed for school.

As for FI, I've looked at it several ways... current expenses with and without current value of primary residence, also looked at it as RE expenses with and without current value of primary residence. It's a fairly large range, but feel pretty good about it. Yes, just a few more years and this won't be much of a concern.

How does one feel better about not earning a promotion or large bonus every few years? That's the new future I see for myself. I do feel very lucky with life.

 

[FIREd]

The possibility of ending up unemployed or underemployed during later years, provides a good reason to plan for early retirement even for those who aren't sure they are ready to retire yet.

Once financially independent, one can work for the fun of it until it isn't fun any more, or until the job runs out, and then retire.

Several people in my family lost their jobs in their 50s. In each case, the new job either required massive retraining, pay and/or benefit cuts, or longer commutes. In each case, it was a huge psychological blow. Seeing the devastation a job loss can cause to someone who is supposed to be at the top of his game made an impression on me.

That's why I swore to myself I would be out of the job market by the time I reached 50. I don't think I could handle being told that I am an overpaid, overqualified dinosaur who needs to learn how to speak Mandarin and bow to his new 25 year old boss. Nope, not gonna happen.

 

[Aiming_4_55]

.... overpaid ......

I've been told, you're highly paid and 2nd highest paid in the department in several positions. Then, I move on and learn they hired 2 or 3 individuals to execute the work I accomplished by myself. Go figure.

Yes, it would be tough to swallow being un/underemployed, but LBYM has helped me in many different ways. By 50, if I'm still working, it'll be for the fun of it.

 

[Texas Proud]

I've been told, you're highly paid and 2nd highest paid in the department in several positions. Then, I move on and learn they hired 2 or 3 individuals to execute the work I accomplished by myself. Go figure.

Yes, it would be tough to swallow being un/underemployed, but LBYM has helped me in many different ways. By 50, if I'm still working, it'll be for the fun of it.

I think one of the reasons I was let go was salary... the new young manager did not know much and had a LOT of people older with more experience... she fired a couple of people 6 months before me and the lady who worked with me... then 6 months after getting us laid off people around her.... got rid of anybody with more than 15 years experience... all with high salary compared with the new out of college recruits she wanted to manage... and yes, the group has a good number more people than it used to have...

I am sure that they took a long time to figure out how to do things... one of the people who used to work for me heard in one meeting that she failed to do something and was mad at her group... someone said 'TP used to do that'... nobody else knew how...