poor economy hitting close to home

[simple girl]

A few days ago a received a letter from my company saying that some changes in payments from Medicare have impacted the bottom line (I work in healthcare) and that they need to implement cost savings measures. The changes include delaying when new employees can accrue time off and begin participating in benefits plans. Another change is they will be reducing the match to 25 cents on the dollar for 401K contributions. I thought our company was pretty recession-proof, so this was a little wake-up call.

Then, yesterday, my brother called me to tell me he was laid off. He works in the trucking business. His wife was laid off last year in May and has yet to find a job. Her unemployment runs out in July. My brother gets 2 months severance and company pd Cobra; after that the company will pay a portion of Cobra for a while. He will also be on unemployment. He said he was going to wait a few days to let it all sink in, and then wants to talk to me about whether to touch his 401k or not. He doesn't have an emergency fund. The 401K isn't huge (around $30K). It is so difficult to see him in this situation, and I can't help but feel guilty for having our financial situation be so much better and secure. <sigh> I know it's not my fault, but it's just so hard to see him struggling. He's a good guy, and I love him.

I don't really have any questions for the group, yet, but I may as I help him problem solve how to manage this situation. Right now, I'm just doing a little venting!

 

[Walt34]

You said he "works in the trucking business" - does that mean he's a truck driver? If so, and if he's willing to move, trucking companies are always advertising around here that they need drivers. It's not an easy life but it does pay about $50k/year, more for the long-haul drivers.

Some people enjoy long-distance driving as they see it as "the company is paying me to tour the country!"

 

[simple girl]

You said he "works in the trucking business" - does that mean he's a truck driver? If so, and if he's willing to move, trucking companies are always advertising around here that they need drivers. It's not an easy life but it does pay about $50k/year, more for the long-haul drivers.

Some people enjoy long-distance driving as they see it as "the company is paying me to tour the country!"

No, he was a terminal manager for a trucking company. Pretty specific area to work in, and no other opportunities in the area where he lives (rural).

 

[NW-Bound]

If he is willing to relocate, there are places in the country where the job prospect is better. For example, Omaha has an umployment rate of 4%, if I remember correctly. Recently, I read of another place where unemployment was below 4% and some businesses had problems filling jobs. I am racking my brain to recall where that was.

 

[Texas Proud]

Sorry to hear about that... but do not rack your brain about your brother to much... part of being a responsible adult IMO (and you might not like this) is to anticipate losing a job...

Now, with his wife losing her's, maybe he did have a reserve and has gone through it...

He is better off than most.... having his COBRA paid for is a big benefit...

Hope he finds something soon, but as others have said, he might have to move...

 

[NW-Bound]

Though I could not find the info that I read earlier, here's a list of places where businesses are hiring. No.1 is Anchorage!

The Best Places to Start Over: Where the Jobs Are - BusinessWeek

 

[ziggy29]

Though I could not find the info that I read earlier, here's a list of places where businesses are hiring. No.1 is Anchorage!

Or "Los Anchorage," as Alaskans outside of the city often call it...

 

[Moemg]

I'm sorry to hear about your brother . A week does not go by that I do not hear about someone else having their benefits cut or being laid off .

 

[W2R]

If he is willing to relocate, there are places in the country where the job prospect is better. For example, Omaha has an umployment rate of 4%, if I remember correctly. Recently, I read of another place where unemployment was below 4% and some businesses had problems filling jobs. I am racking my brain to recall where that was.

A good number of those earning above median wage find it necessary to move to get another job or a higher paying job. It's a fact of life, at least in some occupations that influence my perception of the world.

If we did not have to move in situations like this, it would be easier to approach retirement with a bigger nestegg. To me, the question would not be IF he would move, it would be WHERE he would move to. I am so sorry to hear that he has lost his job, but I would urge him to expand his search geographically if he is having trouble getting another job in your location.

When I first started looking for my present job, my first choice location among big cities would have been Houston. The job was in New Orleans, though, so here I am.

In retirement, there is great freedom of choice concerning where one lives. The idea is mind-boggling.

 

[simple girl]

Sorry to hear about that... but do not rack your brain about your brother to much... part of being a responsible adult IMO (and you might not like this) is to anticipate losing a job...

No, I don't mind you saying that. I know it's the truth...I have to control myself from trying to save everyone...a little flaw in my personality!

Though I could not find the info that I read earlier, here's a list of places where businesses are hiring. No.1 is Anchorage!

The Best Places to Start Over: Where the Jobs Are - BusinessWeek

That is very interesting! He is very entrenched where he lives, but I agree, he needs to do whatever it takes to pull out of this. I will certainly be discussing that with him.

Thanks everyone for the support.

 

[DangerMouse]

It's never easy dealing with issues happening to family members. No matter how they got there, or if there choices are good or bad in our minds, it doesn't stop us wanting to help them get themselves out of their mess.

Hope things work out ok for your brother.

 

[bbbamI]

Bleh...sorry to hear about your brother's situation.

DH had to give the pink slip to so many people before he left his job that we almost became numb to this fact. But, when it's a family member...you can't make the lousy feeling go away. Hopefully he'll find another job soon. Try not to worry too much......

 

[ziggy29]

DH had to give the pink slip to so many people before he left his job that we almost became numb to this fact.

This is one reason among several why I NEVER want to be in management. I'm very content with my current position on the corporate ladder (to the extent I have to be on it) -- the highest rung below manager. That's the ideal spot for me.

 

[bbbamI]

This is one reason among several why I NEVER want to be in management. I'm very content with my current position on the corporate ladder (to the extent I have to be on it) -- the highest rung below manager. That's the ideal spot for me.

Yeah...the last year of his employment was really bad. I had my doubts about him sticking it out; but the pension and benefits kept him going. Thank heavens it's all over with. I don't ever want to have to go through something like that again.

 

[Rich_by_the_Bay]

You're right about health care no longer being economically immune. We are undergoing forfeitures of bonuses, hiring freezes, and other measures that reach right into your wallet. The workload grows and the ranks get thinner = work harder and longer for less money. Just like any other sector except that we can't (and shouldn't) turn anyone away including the uninsured.

I'm not one to wish time away, but in some ways I am glad I'm 60 and not 40 from a career perspective. Things will get much worse before/if they get better.

 

[Sparky]

I read an article recently about helping recently unemployed friends and family - invite them for dinner (don't make it too elaborate - you don't want them saying, "what are we celebrating?"), offer to babysit or dog walk, offer your networking contacts...

 

[Delawaredave5]

Most unfortunate is the "double whammy" of both spouses losing their job.

I can name over 50 people I know unemployed / underemployed - just about every one of them has a working spouse - so their immediate lifestyle hasn't visibly changed.

No sense discussing/debating whether or not they should have had a reserve. What matters is immediate cost control and both of them scrambling for work. $30k can be easily burned through in months, not years.

 

[Walt34]

I can name over 50 people I know unemployed / underemployed - just about every one of them has a working spouse - so their immediate lifestyle hasn't visibly changed.

That happened to us once when DW was "downsized". A very depressing time for her until she found another job, for a girl who had been working since she started babysitting at ~13 years old.

 

[Sevo]

Your heart just has to go out to any one that wants to work and loses their job. When it is your family you can't not feel very sad and if you are doing ok then the odds are that you are going to have "survivor guilt". Your Brother is very lucky to have a loving and considerate Sister who genuinely cares about him.

 

[Buckeye]

My younger sister (49) was laid off in April 2008 and has not been able to find a job in her field (graphic artist). She is/was close to the edge like your brother and I want to save her like you do your brother. I think I helped too much in the beginning. She finally found a state (WA) program where she could go back to school to update her skills which had gotten rusty while working for her previous employer (lesson there). The state covers her tuition and doesn't cut off her unemployment for being unavailable to work.

I love her very much and it's hard to see her go through this. I live in terror of a medical issue coming up because she has no health insurance. I try to help out by taking care of little stuff like adding minutes to her cell phone or sending food packages. Omaha Steaks has had some crazy sales this summer. I just want it to be all better for her ASAP!

 

[Amethyst]

Am sorry to hear that your company is reducing 401K matching (it's a benefit I don't receive, but I realize many others depend on it for retirement savings). Good thing you have been responsible, and probably will bounce back from this better than some would!

Then, yesterday, my brother called me to tell me he was laid off. He said he was going to wait a few days to let it all sink in, and then wants to talk to me about whether to touch his 401k or not. He doesn't have an emergency fund. The 401K isn't huge (around $30K).

So sorry to hear this. What a blow for your brother and his wife. I sure hope he and his wife can get some kind of work--whatever it takes; we've all worked icky jobs at times--to fill the gap, so he doesn't have to cut into that hard-won 401K. What I'm thinking is, he's probably many years from retirement, so that 401K money will reap "the magic of compounding," if only he can keep from using it! Years from now, he will be so glad!

Let us know how this goes,

Amethyst

 

[youbet]

Then, yesterday, my brother called me to tell me he was laid off. He works in the trucking business. His wife was laid off last year in May and has yet to find a job.

Today's life style of dual incomes adds a lot of risk to recessionary, high unemployment times like these.

Our son and DIL both have good jobs as engineers, she a chem eng and he a mechanical. Each contributes about 50% to family income. They have three kids (our beloved grandkids! ) one in full time daycare and two in before and after school care.

If either our son or our DIL was laid off, DW and I are prepared to pay their mortgage and babysit to eliminate the daycare costs during the unemployment period. They have reasonable savings (about $300k at age 35 predominately in tax deferred accounts) and no debt other than the mortgage so they really wouldn't need emergency funding if one was out of work. But we'd contribute as we'd hate to see them lose the savings mentality we've pounded into their heads the past decade.

If both of them were laid off (gawd.....hate to think about it!), DW and I could/would do the same things but if the situation persisted for more than a few months, the kids would have to start withdrawing from savings, possibly even from deferred savings. Yuuuch...... They're on a roll and I'd sure hate to see "saving" turn into "withdrawing."

By far the biggest impact on our lives since this recession started is keeping two sets of books....... one for life with both kids working and one for life with one unemployed and us paying their mortgage during the job hunt. The second biggest impact has been the reduction in value of our portfolio which, despite the decent second quarter performance, is still down significantly.

We're ready for the economy to improve so that hardworking, qualified people have little risk of long term unemployment.

 

[militaryman]

Today's life style of dual incomes adds a lot of risk to recessionary, high unemployment times like these.

If either our son or our DIL was laid off, DW and I are prepared to pay their mortgage and babysit to eliminate the daycare costs during the unemployment period.

^^^^^^^^ Need to get some parents like that ^^^^^^

**** Note to self, Need to BE parents like that ^^^^^^^^

 

[NW-Bound]

Here is some interesting info. I don't know how reliable it is, but it is claimed that the DC area has 6 job postings for each unemployed person. It seems to jibe with Walt34's observation that traffic on the Beltway is terrible. Despite past pledges to keep the government small, I've read that it kept growing. Well, if not at the state level then at the Fed level as the latter can print money. Not all jobs in DC are Fed jobs, as there will be also many supporting jobs in the private sector.

The 2nd best place is Jacksonville, Florida. One needs to go to where the money is: Can't Find a Job? Best and Worst Job Markets | Indeed.com