just lost my job

[rw86347]

I just lost my job. My whole department was laid off. We got a nice severence package (5 months).

I should be stressed, but I am not. Some how I actually think I might come out ahead. In fact I am loving my free time. I guess I will need to find a job before my company quits matching my 401k in October.

Yesterday I was thinking, you know I could probably avoid working for a year, but then I would miss my savings goals.

I feel bad for my friend/co-worker. He is in debt up to his eye balls. I think the stress might honestly kill him. He has an ARM, and still isn't making it. I sat down with him yesterday and told him to sell his house, and buy a cheap condo. (and swallow his pride if necissary).

RW

[2B]

Congratulations on your financial foresight. LBYM pays off when life happens. You have the luxury to smile and do a good job search.

I don't know what you do, what you will do or where you want to live while you do it but there is life after being run off. Five months severance says that you won't even feel a significant impact for that period of time and if all goes well you can pocket a little cash.

I've been downsized, right sized and just plain fired before and I can assure you you will live through this. My advice is to first start looking immediately for a comparable position but also evaluate your options for something you'd like to do better and what you can get quickly if nothing shows up soon so you won't lose any income flow.

As the dust settles and you aren't reemployed quickly you can start thinking about how you can take advantage of your new freedom while still job hunting. Count your cash and see where it fits into a life plan. If you aren't ready to FIRE now, you're gambling by taking a year off.

I've watched many coworkers get repod of cars, boats and houses. My first layoff was probably the best thing that ever happened to me financially. I was in debt up to my eyeballs and would have lost my house and been living under a bridge if I didn't find something as quickly as I did. That gave me financial religion that has me pretty close to being ready to FIRE myself.

Quote:

Originally Posted by rw86347 I just lost my job. My whole department was laid off. We got a nice severence package (5 months). I should be stressed, but I am not. Some how I actually think I might come out ahead. In fact I am loving my free time. I guess I will need to find a job before my company quits matching my 401k in October. Yesterday I was thinking, you know I could probably avoid working for a year, but then I would miss my savings goals. I feel bad for my friend/co-worker. He is in debt up to his eye balls. I think the stress might honestly kill him. He has an ARM, and still isn't making it. I sat down with him yesterday and told him to sell his house, and buy a cheap condo. (and swallow his pride if necissary). RW

I am guessing that your company will not match your 401K or even allow you to keep contributing to it while you are not working. I could be wrong, but this is the way the severence usually works.

[VoyT]

Really sorry for the layoff, but isn't it great that you can get by for a while without the paycheck?

[bow-tie]

That's a bummer about your layoff. Hopefully it works out for the better.

Does this ease the issue with your DW wanting to move to a different house? Or does this add fuel to the fire?

[HFWR]

My severence package was 23 wks pay, during which time the insurance and 401k matches continued. YMMV...

[free4now]

My severance package included insurance for the first 60 days (due to california labor laws) but it stopped after that even though I got more severance pay.

The 401k contributions were automatically made at the rate I had been contributing before. One hassle was that I had to wait until about 2 months after leaving before I could roll over my 401k account, because my company forgot to release the "more contributions may be coming in" lock on the account.

Congrats on having gotten yourself into a place where you have some breathing room.

[justin]

Congrats on the 5 months of free money , and good luck on the new job search .

Spend tons of quality time with your daughter while you have the time! In a recent post you said that was one of the reasons you wanted to FIRE in 7 years - to spend more time with your daughter. Now is your chance.

You've worked hard to structure your life in a financially conservative manner just in case something like this happened.

[SteveR]

Sorry to hear about the job loss. Losing a job before you are ready can be traumatic. Losing a job when you are prepared financially but not emotionally ready can be a catalyst to make you choose which way you really WANT to go. Sometimes it is not always about the money. If you are not ready to ER the stress of finding a new job can be consuming.

I wish you the best of luck in your chosen direction.

[sendbaht]

I know it will work out for you with your positive attitude. My goodness son, it's at least summer so one or two months of doing nothing but relaxing is something you deserve.
I am lucky in the sense I do blue collar work and have never lost a job, always had a paycheck coming in, unlike most of my buds who like you get the axe now and then. Ok pal, good luck.

[renferme]

My former "partner" at work got laid off 6 months ago... received a severance of 12 months (nice)... refuses to look for another job until this fall sometime...
Continues to spend like he's working... the end is coming and my prediction is: NO JOB. When that happens, this stubborn guy will realize the folly of his ways.
He's about 50 and nowhere near ready for retirement.
Moral: LBYM

[NinjaPigeon]

I can't imagine people who'd keep spending the same amounts. I'd start looking for a job the first day. If I got one, then I'd consider it a great way to get ahead 6 months towards FIRE.

[heyyou]

Reply to 2B: That early-in-your-career financial trouble is the best time to learn that hard lesson. I went through the same when I was 27 with my new, first house mortgage. That was the best financial lesson that I've learned. After that, my motivation was to LBMM, save, and invest which eventually lead to FI/RE. Now I'm grateful for that ill-timed layoff, I just didn't know that at the time.
Joe

[GTM]

Quote:

Originally Posted by rw86347 I just lost my job.* My whole department was laid off.* We got a nice severence package (5 months).* I should be stressed, but I am not.* Some how I actually think I might come out ahead.* In fact I am loving my free time.* I guess I will need to find a job before my company quits matching my 401k in October. Yesterday I was thinking, you know I could probably avoid working for a year, but then I would miss my savings goals. I feel bad for my friend/co-worker.* He is in debt up to his eye balls.* I think the stress might honestly kill him.* He has an ARM, and still isn't making it.* I sat down with him yesterday and told him to sell his house, and buy a cheap condo.* (and swallow his pride if necissary). RW

Won't you and your friend be entitled to collect unemployment insurance as well as the severance you received?

[Craig]

Unemployment benefits are pretty meager.

Best of luck on the job search, and take the time you need ... but don't delay too long on that job search. I've seen those nice "free money" times become fond memories when the job search extends longer than anticipated ...

Congrat's on LBYM. Huge deal, especially at times like this.