American Express is cutting 7,000 jobs. Jobs are being slashed everywhere and that has me thinking…
What would you do if you lost your job tomorrow? Do you have a savings? Do you have enough to cover six to ninth months worth of all your expenses? Would you be OK for a while? Would you have a place to go? I am anxious to hear how stable people are. (If you leave a comment, feel free to do so anonymously.)
We have just enough to cover 6 months of our basic expenses. (We’d have to kill things like cable, maybe car insurance, phones, etc. Which is interesting, as more people cut things that are considered extras, won’t that mean even MORE layoffs?) We do have a place to stay if need be should things stay bad.
I’m not sure what we’d do honestly. Freak out?
It’s odd that you bring this up… just a few minutes ago, my department got out of an “emergency staff meeting” where we found out that 33 people out of our entire staff of 400-something are being layed off. Two of those people are in my dept. It’s very touchy around here right now, with some people crying and others making awkward, nervous jokes. So your entry today hits close to home.
Thankfully, for me and my family, it hasn’t truly hit us directly, though today’s meeting makes us nervous. If one of us lost a job, yes we’d be OK for 6-9 months, but there would definitely be some serious changes. Like, no more daycare, selling one of the cars, etc. We would be fine, but we’d have to “hunker down” and not spend anything that wasn’t absolutely necessary. We bought a tiny townhouse with a tiny mortgage, so we’d be able to keep our home.
I would be in a bit trouble. I have very little savings, a lot of school loan debt, and some credit card debt. I would, at least, have a place to go—my boyfriend would take me in and could help me out for a little while, assuming a) he kept his job (we’re in the same industry, but at different companies) and b) I was able to find something else within six months or so. Truthfully, I worry more for my parents. My father is approaching 60 and works in a manufacturing job in a very economically depressed area of upstate New York. If there are layoffs, he would be a prime candidate, and at his age, his prospects for finding new work would not be good. My parents have savings, but not enough to live out the rest of their lives on, and with the hit pensions and 401ks just took, there won’t be time for them to build back up before retirement. I feel like a lot of us in our 30s, even if we do face job loss, might have it rough for a while, but will be able to rebuild. For the older generations, particularly the working class I grew up in, there could be real trouble.
TJ and I would DEFINITELY have to cut back on all the extras. And it wouldn’t stop at just the cable TV and cell phones. I imagine we’d have to get rid of the car as well, not because we have any expenses on it, (it’s a hand-me-down) but because of car insurance.
And what would happen with health insurance if we lost our job? Cobra? I have to research that just incase. While I am OK with living without it, I wouldn’t dream of letting my son go without it. :[
I get the feeling that New York City is going to see a heckuva jump in crime over the next year. More and more jobs are going to be lost, the economy here is going to slow drastically and with that brings more and more crime. Certain neighborhoods have already seen a huge jump. Gang violence is higher it seems. I worry.
A: did you see the Obama special last night? Your father’s story reminds me of the older couple who had to take a job during retirement to pay for their medical bills, which BTW had me crying like a damn baby. (My parents are OK right now, but my mother has rheumatoid arthritis and takes a lot of medicine to live a normal life. If they couldn’t afford health insurance and had to go back to work, I am not sure what I’d do.) I think that’s why their story hit home. Poor guy was heading back to Wal Mart of all places just to keep their head above water. That’s not right.
I have a soft spot in my heart for our elderly. I can’t imagine watching that group suffer.
I am rooting for you father, A.
I’d run off to some far away place, maybe to never return.
In seriousness, though – I was pretty well prepared – mentally and financially – for my eventual unemployment without having to rely on any severance. When they threw all this money at us when they closed the department, well, that just made it all better.
Downside, though: I’ve been at this for too long. I’ll have to be dragged back kicking and screaming. It’s just way too much fun doing all this. I will definitely do something similar again sometime soon.
(Some longer personal comments on the atmosphere at the nyse as people were losing their jobs weekly. I noticed two types of people. First, there were those that were waiting for the inevitable with fear. They saw it as possibly the end of it all; there was nothing beyond that building. They fretted about what company would hire them in that event. The others started making plans for a different life (or preparing for a lengthy layoff). Some were going back to school, others were going to semi-retire, open a restaurant, switch fields etc. etc. The constant threat of it being your and your co-workers/friends last day of work was still depressing and stressful as it dragged on for over a year, but in the end, the latter group was smiling wide when the day came. The pressure was finally lifted. While the future just became more uncertain, it also got more exciting. This group contained individuals as well as those with family… it’s a lot about personality, not so much circumstances. I also noticed that when I told people in that first group my post-layoff plan (this was a popular topic) to study in China for a year (or more!), they thought I was crazy. Those already adjusting before the axing said it was a fantastic idea. You can control life or let it control you.)
We have no savings- at all. If my husband lost his job, we would have to go live with my mother. Luckily, this is an option. We’ve always been poor. One income doesn’t work in rural, upstate New York. I had been in college our entire relationship, working part time when I could to contribute. Then I immediantly got pregnant and had our son. We think the benefits of me being a stay at home mother are worth scrapping by living on only one income.
The only part that really pisses me off is we had paid off all my credit card debt this past spring and now I am nearly back to where I was before just to afford gas and groceries!
We’re trying to get out of this area and move to a place (a suburb) where my husband can make more money doing what he does here!
I don’t worry too much. I don’t want very much. Just to be comfortable. Things can only go up from here. I’m optimistic.
I’m fortunate to have enough savings to cover my expenses for 6-9 months if I lost my job. That wouldn’t keep me from panicking about my employment prospects, though.
I’d say, maybe two months. For sure no health insurance. I am at the basics already. It is my usual lifestyle. No car. No cable. No internet (stolen! I’m a bad person).No netflicks etc. Just rent, lights, gas, food, cell phone. After two months I would loose the apt. However, I am well versed in crap jobs and it doesn’t take much to make what I live on so…..
This has me up at night. Unfortunately this economic downturn hit us a little too early. My husband and I just spent our first 2 years of marriage deleting all credit card debt, which was amassed largely while I was looking for work a couple of years ago. He is a 5th year grad student, so we are a single income family with 6 fig. student loan debt who just had a baby. Needless to say, paying off our credit card debt was a challenge with all of these restrictions, but we did it, and were poised to enter the “build up savings” phase of our marriage’s financial plan when this crisis hit.
Now I spend $6000 per year on gas to get to work instead of $3000 for last year – this totally absorbs and then some my raise from last year. Our food bills are sky high. With a baby we’ve had to add child care expenses. In order to pay down our credit cards, we were already living down to the bone. I haven’t had a haircut in over a year – we’ve never had cable – our cars are used – we don’t go to movies, go out to eat, and frequently don’t eat meat. No birthday presents or anniversary gifts for each other. I make my own baby food. During my pregnancy I had 3 pairs of pants, to last me the whole nine months. I mean, there just isn’t anywhere else to cut, and now suddenly our bills are bigger, we have no savings, and my manufacturing job is looking unsteady. (The reason, by the way, I spend so much on gas is I drive an hour to work. Because I bought a house five minutes from my job and a few months later my manufacturing facility shut down and I had to find a new job. I would LURVE to get the heck out of manufacturing Human Resources!)
It makes me sort of sick inside, because I was ready to feel good about savings, and ready to splurge on the odd haircut now and then, and ready to exit this phase of extreme poorness which we’ve been in for 4 years. Now it seems I have a longer, harder slog than we first realized. The silver lining, though, is that at least we have no C.C. debt now!!
What we’re doing is thinking of selling our house, earlier than we’d planned, pocketing the $15k we predict we could make on it (this is a lowball figure), renting some crappy place and using that $15k as the “just in case” fund. It was supposed to be the down payment on the next house, and it still would be if we don’t need it. This is presuming, of course, that we could sell our house, but we live in a tiny wee starter home, and those usually sell regardless of the market. We live in a neighborhood of tiny wee starter homes, and they seem to be selling just fine, and holding their value well.
We also have approx. $150,000 of open credit on credit cards. Using those would be a dead last resort.
Michele, I did watch the Obama special. And also cried. That story felt so familiar to me, as did the last one, where the father was down to part-time and the wife had been laid off, and they had kids to feed. I was the first person in my family to go to college, I got a job, moved to NYC, and in some ways I left behind a lot of the working poverty I grew up—though I still work in an industry, publishing, that is not high-paying, at least not relative to the costs of living here. But there were times in my childhood, where we were sometimes a single-income family. My mother was a SAHM until I was around 10, when she went back to work part-time—she has worked full-time since I was in high school. My father, who did factory work, would occasionally get laid off, and we would be on food stamps, and it was such a horrible shame for my mother, who would cry in the car after paying with them. Thankfully, my father always found new work eventually, and we got through the rough times. But to think that now, after years of manual labor which have left my father’s back a mess (he’s recovering from back surgey at the moment, which is why the threat of job loss seems even greater to me and probably why I am writing an emotional post on your blog comments) that he could lose his job and not have health care or retirement benefits because there is no company loyalty for his years of hard work, breaks my heart. It also breaks my heart that my family always made sure I was taken care of, and I did get to go to college (working all the while, and still with loans to pay 10 years out), but that I still don’t make enough money to really be of much help to them now. This economic downturn has really brought home to me how flawed the system is and how that whole American myth of working hard and achieving anything you want just doesn’t ring true. I have no idea how to fix it, or if it’s fixable, but we certainly have to try. It is not okay to have our parents and grandparents, who often have done everything you were supposed to do—work hard, put aside savings, take out retirement plans—in ailing health, having to take minimum-wage jobs just to scrape by.
We are in the middle of this right now. I got laid off 2 months ago and every interview I’ve been on hasn’t gone anywhere. I was lucky, and had a small severance package, but that is gone in a couple of weeks. And I am terrified. We can cut some expenses, but not all of them, due to working from home and needing to have 2 cars. We are far enough outside of Atlanta that the public transit doesn’t reach us. I am lucky on several fronts, my husband makes good money and we have a family insurance policy so I still have insurance.
The stress levels at home are insane, but hopefully I will get some kind of work before things get really ugly. On the plus side, I have been able to get back to going to the gym (which we pay almost nothing for) and am finally loosing the baby weight.
FWIW – in my experience, COBRA policies are very expensive, the one offered by my former employer offered, would have cost me about $400 a month.
This thought scares the hell out of me, has me on medication and keeps me up all hours of the night.
I am a single mom of three kids. My ex royally screwed us over and is now sitting in prison – which of course means no child support. THREE people depend on me in the world and I have no safety net, no savings, nowhere to go if I couldn’t pay my rent.
I work full time for a small law firm (10 years now). I am the lowest on the todem pole, not hard when there is only 5 other employees – there’s just no where else to go. I have always been able to support my children, always found a way to make it through, but never had to try in an economy like this. I am used to the barely scraping by lifestyle – but I’m sure my family would end up in a homeless shelter very, very quickly if I lost my job.
Absolutely terrifying.
it’s become apparent to me how very very lucky i am. we do have some savings, probably enough to last 4-6 months if we needed to, although we’d definitely have to cut back on our larger expenses (day care, for one) to make that happen. And there would definitely be no health insurance. we have good credit and could also fall back on that if we absolutely had to. we are also very lucky to have good family/parental support, so if we got really desperate could move in with either family (although I shudder at the thought of having to do this!).
even still, it’s scary to me. my husband is just finishing grad school and i’m worried that he’ll have trouble finding a teaching job. many universities are canceling their faculty searches. and my job is secure where i am now, in the sense that layoffs are extremely unlikely, but if my husband does get a teaching job, and we move, will i be able to find a job there? it’s looking like more of a challenge. on the one hand, i’d love the opportunity to have more time at home with my daughter, but on the other hand i’m not sure if that will be economically feasible.
i can’t imagine how difficult and scary it must be for those who don’t have a good support system or any savings to fall back on.
my holiday budget will be a little tighter this year, but i think that instead of giving tangible gifts i’m going to mostly be giving charitable donations to organizations. i feel the need to do SOMETHING for folks who are really suffering right now.
I got laid off from my hospital job on the 15th of this month. No warning, no severance package. I DID have excellent, free health insurance. Now I have to go on my husband’s horrible, expensive insurance. I have a lot of health problems, and we have a 15 month old daughter. Staying on Cobra would cost me more than $500 a month, which means it’s not a possibility. We have no savings, I am still in school, and we were barely scraping by to begin with.
My parents are not in a position to help us out. My husband’s mom could possibly help us out a little, but it would be very grudgingly as she has to support my two brothers-in-law that have disabilities.
I had an endoscopy and colonoscopy a few weeks ago, right before I was laid off. I can’t schedule my follow up to get the results now because under my husband’s insurance, I have to have a referral to see a specialist (which is who did the procedures) and the doctor can’t give the results over the phone. It’s so messed up.
I’m very worried.
I’d be (@&# if my current clients tried to stiff me on a bill. Some are late, that irritates. Being a startup/entrepreneur is tough.
COBRA is mostly a sham. Having been on it for 2years, the only reason you should do it is because you can’t switch programs or your old plan was a godsend.
It basically says that you have 18months of guaranteed coverage by purchasing your old plan from your employer at their plan price, + a 2% admin fee.
However if you search around you can find significantly better deals. I learned that the *same exact plan i was paying my old employer $600/month for could be had for $300 through an online broker. The reason for price discrepancy had to do with the old employer’s filing status and weird stuff like that. Other usable plans for me ranged from 150-400 depending on what i wanted to cover in pocket or out.
We do have 6-9 months emergency fund (thank you Dave Ramsey – listen to his financial radio show, it rocks). But, after that, who the heck knows? I am a SAHM working part time, luckily, make a very good wage for working from home, and my man works on top secret satellites, and who knows when they decide to take that money away.
We will probably move to Montana to be closer to family and work mundane jobs to survive. That’s fine with me, though. I’m sick of Phoenix and the city life. When I can grow my own groceries and can them and use them all winter, I’ll be happy with that.
Health care, that is a different issue. We do need it for our 13-month old, that’s for sure. I guess we are just going to have to cross that bridge when we get there. We have lots of family support, so that is a good thing to lean on.
Don’t fear people. The media likes to make us scared. That’s their job.
I read your post this morning and not 10 minutes later the director of our department called a meeting to announce layoffs. My boss is out (along with 69 other people), though he does get a one month transition period. I spoke to my husband after lunch and his company also had layoffs today. Luckily we are both safe for now, and my company purposly cut deep this time to avoid having to make future cuts, but it is a stressful day. We have a little savings, probably 3-5 months. Our families could probably help a tiny bit but not enough to really make a difference and they are too far away to move in with. I am very marketable and just today got a call from a headhunter looking for people like me, but my husband would likely have to change fields to find a job quickly enough and even that isn’t very good bet. It’s funny how just yesterday I was reading blog posts about the economy being such a mess, and thinking how it was probably exagerated… not so much.
Oh, by the way, we don’t have cable, or a phone land line, we don’t have expensive clothes and we don’t go crazy shopping and one of our cars is paid for. We don’t live extravagantly. We do, of course, have to air-condition our house, which is probably the most expensive bill we pay all year (being in Phoenix). I’d love to have a house that was only 62 degrees. Geez, it doesn’t even get that cold in our house in the winter!
A year ago we may have been okay for a bit … living off our equity line and savings ‘til we could re-establish. But we bought a new house that needed some work and we haven’t rented/sold the old one so we’re living paycheck to paycheck now and it makes me nervous.
I consider ourselves lucky that our jobs are very stable right now.
My husband lost his job this summer and decided to go back to school. We’ve cut back and are totally OK living off my salary. But if I lost my job, we’d be screwed. We’d have to take money out of retirement since that’s the only savings we have at this point.
Yes, poor planning on our part, I know. We’ve been trying to pay off the credit card debt (< $5000) before saving the recommended 3 – 6 months of salary. The retirement savings is mostly invested in the stock market so how much is there varies from day to day. I hate to think we’d have to touch that because of the stiff tax penalties, but we’d do it if we had to.
I’d consider walking away from the house since it’s the biggest payment we have. Our cars are paid off, which we’re thankful for. I bet our families would step in and help before we’d have to leave the house. But both of our parents would like to retire someday and doubt they’d be real happy to support us.
Losing a job would be pretty disastrous for us. It makes me scared thinking about it. However, I take full responsibility for not being more prepared.
I think living in Australia is a definate advantage in this situation. We have unemployment benefits, free healthcare, rental assistance and a fairly steady employment rate… but there are layoffs happening and its a concern for a few of my friends.
Personally, its not something that worries me and it never really has. Sure, I have no savings and due to bad eyesight and horrible dental issues I pay alot out of pocket for those expenses but if I were laid off tomorrow I’d be in the same situation I am today. I’d just go get another job. I might go a week or two without pay which would mean being late on some bills or borrowing from my dad to cover rent.
I’m lucky that as an office administrator with plenty of experience at temping I am rarely without work. The longest I’ve gone between jobs has been about a week. Even if I can only get 3 days of work a week, when I’m temping thats the same money as when I’m working a full time job.
With changes in our government and the issues coming across from the US financial crisis though, this could all change… I hope not.
counting my blessings
We would be in real trouble. We have exhausted our savings in the last 5 years, and what we have was wiped out (40%) by recent stock drops. Luckily, my husband’s job is a government job that is not likely to be cut (it would be bad press for homeland security to be cut) so we’re staying afloat. He also has a second job that is a service job that makes it impossible for me to go to work, since he doesn’t have a set schedule and we have two little girls at home. We do have family that can/will step in if we are going under, but keep your fingers crossed, we should be okay.
The husband and I have discussed this quite a bit, because in all honesty the whole thing hasn’t really hit us yet. Then a good friend got laid off last week and we really started to think.
We are a bit lucky right now – I am a full-time student and the husband is an assistant professor in a program that is booming financially for the university he works at. He is pretty safe, but of course you never know (he doesn’t have tenure). We live in Ireland, so health care is only slightly an issue and if he did get laid off, we would likely move to England (where he is from) where it is not an issue at all. It has been a while since I lived in the States, so the whole health care thing is a big deal to me.
But, we have no savings. None. We have debt. Me – loads. Student loans (which go into deferment since I am in school, but they still loom). We live very cheap – no car, no major purchases. We would find it difficult to cut down more. And, there are two key areas where this might just affect our lives. Firstly, we are wanderers. We were hoping to leave Ireland in the next year or so. This won’t happen. We need the stability. And, we were thinking about the baby issue. I don’t know if I want to bring a baby into a family that is not (somewhat!) financially stable.
I worry about my dad. He is a salesman who always seems to get laid off when times get tough. Maybe he has more seniority now? I don’t know. My brother and his girlfriend are feeling it – they just moved (with their baby) so he could go to school and now she can’t find a job in her field. She is working as a waitress.
I hope all your readers are okay!
Some of your stories are breaking my heart.
I wish I had an hour without having to chase an infant around to think about ways to help people. Where and how did the problem begin? What can be done to stop this trend?
I am reminded of the number of times I have heard someone from the baby boomer generation yell about how OUR generation doesn’t have any savings and is swimming through credit card debt. WHY do they/we think that is? Do they think the middle class of today WANTS to be swimming through debt? And so many people are in debt and unable to pay for necessities, that I think it stands to reason that this isn’t some big trend of irresponsibility but a problem with the actual system. The cost of living now is simply too high. And we need to stop it, we need to reverse it. The question is, how do we change the course?
I wish I knew more about this stuff. As it were, I feel very much like I’m treading in waters that are too deep for me. I always get very nervous talking about this stuff because I don’t have the facts or information to really get into the meat of the matter.
Anyway.. this is a long comment without saying very much at all.
I’m frustrated. Again. And sorry for how hard it is for everyone.
we are the “ME” generation!!! : )
I quit my job in May for a cross country move, and since having my son in September, have not yet started a job search. My husband is in grad school, and we are living off his research assistant stipend and student loans this year. We have enough to get us through next May, but may need to make our funds last longer than that if I have trouble finding a job.
For the next 8 months we are in a stable position, since it is unlikely that my husband’s research assistantship will be taken away, but we are afraid of what this means for funding next year. We are lucky to have neither a mortgage nor car payments. We could always move in with one set of parents if things got really bad (they’d probably fight over us what with the new baby and all), but that isn’t what we’d envisioned for ourselves.
Actually, if I loose the job today, it won’t affect my family that much. Our saving is actually good for at least 5 years. Our little townhouse is paid off. No car payment. No debt.
To get here, I have been a saver since I graduated from college. The biggest spending was rent but I always had roommates, lived with my uncle (rented a room in his house), etc. I drove a used car for years. It’s OK in our culture to live with our parents, relatives, etc. for couple of years and that’s how we saved on rent.
We would have major problems, if we got lost our jobs. We have virtually no savings. We live pay check to pay check for the most part.
We got married young. Started a family young. Have only been out of college and working for the past four years, but have debts from our “early marriage years”.
But, we’re working on it. We decided to start moving money over to savings. We’ve bought stocks, while the prices were good. We are trying to change our ways, and save.
My pay is a week late, and I’m in tears today (compounded with hormones, natch) over how much it’s screwing me over.
I’m a student for my 2nd degree. Even student loans don’t come close to covering my costs. I have friends who would help me out if I needed it, but I live paycheck to paycheck in a most desperate way. I have so much debt, and my credit rating is so ruined that I’m seriously considering filing for bankruptcy.
I’m going to have to hope to marry rich.
I was thinking this today as I walked to the school. No one passing me by would ever have any idea of how dire my finances are. I look normal. I was even walking with my iPod (a shuffle I got as a gift). My bank account is overdrawn (I don’t have an overdraft) and I literally have about sixty cents to my name.
But, I’m still lucky. I’ll never have to sleep on the streets, and hopefully never go hungry. I live in Canada, and my healthcare is free.
But, it’s not the best feeling in the world knowing that you can’t even afford to buy yourself a coffee, dammit.