If H lost his job, we'd be fucked, plain and simple. My take home doesn't even cover the mortgage. We'd probably borrow from MIL until we could get H a new job and sell the house, cause it wouldn't be local.
There was a time when there was concern about layoff's at his job and he was low man on the totem pole. I kept a single shot of Fireball in my purse at the time. It became known as The Red File. I never needed it, thank God.
I would most likely have to sell my car and get something with a lower monthly payment. We would cut back on travel and other non-essential spending. With these changes we likely wouldn't have to touch our efund.
Well, if DH lost his job, it would mean some pretty major life changes. For example - we could move somewhere on what might be a permanent basis! Whoo-hoo!
The yarn budget would dry up. *sniff* I have a decent stash laid in for just such an eventuality, though...
Seriously, though we'd probably actually have to budget. But, we could finally look at having kids, because we'd finally have one spouse not working a job that makes caring for kids difficult. And, I could go back to working in the office, instead of telecommuting.
So, we'd have to be much more careful about budgeting, but we could live indefinitely on my income alone. Or vice versa.
We'd have to cut a lot of savings and generally tighten things up a bit but we would still be in the black. We earn very similar amounts. It's a pretty good place to be and I hope we take advantage of it one day (by choice not crisis). I fantasize about starting my own company and my husband has talked about going for his PhD. Although to be honest, most likely we'll both just keep running the rat race till our kid(s) are established.
Post by daisypaloma on Sept 22, 2014 22:26:26 GMT -5
We'll still able to pay the minimum bills, but the savings, fun, would likely be cut back. We'll eat and go out less, no travel, say no to party invites; etc.
Our efund would likely be used $1K\month; so that's going to last 9 months. But we have other $ in other save to spend items that should last us a long time.
But honestly, being the breadwinner; I would only give myself 6 months to be jobless; and find a way to bring in at least $1K to the table.
We could pay the mortgage (close to 2/3 of my take home), electric/gas, DH's car payment and our car insurance just fine on my salary. We'd use any unemployment and/or severance to spend as little on groceries and gas as possible, cut eating out, and consider cutting cable/internet though we'd immediately downgrade our package. Once UE was exhausted, we'd be able to go a year maybe? 16-18 months? Longer if we sold DH's car and my dad gave us back our former 3rd car (a beater). That would free up $400/month but would leave us with an unknown for repairs.
haha, no (cc hamster). I just wanted to talk about something MM on MM.
We would take V out of daycare, halt college savings, cancel the gym membership. We have 6-7 months' worth of expenses at zero income. With one person working, we could last ... about a year.
I'm a sahm so it would be rough. We have 4+ months of expenses saved. If we got unemployment and SNAP benefits we could stretch that out to 8+ months. We might sell one of our cars if we got desperate but there aren't a lot of things outside of savings that we could cut from our budget.
Eta: I ran the numbers and it is better than I thought. If we got unemployment and SNAP for six months and I continued on WIC after that we would be able to avoid selling vehicles or our house for 13 months. After that we would likely sell the house and move in with DH's parents. My in-laws are great but I REALLY hope it never comes to that.
If the primary breadwinner in your household lost their job, what adjustments would you make to your monthly expenses?
With your current e-fund, how many months would that last?
We'd live in a tent. I'm only partially kidding.
Haha, really. We own a vacant wooded lot in addition to our house. We could live off the land? Anyone know how to shoot a deer? Or squirrel? Or edible weeds of the midwest?
Post by littlemisssunshine on Sept 22, 2014 22:54:20 GMT -5
We make almost equal money, and we can live on either salary. However most extras would have to go: cable, eating out, entertainment, Netflix, etc. I would also trade in H's car for something that didn't have payments. He has 45k of equity in it so he would still have a nice car.
If we both lost our jobs and had to live on savings? Probably two years before we were living in a tent.
Post by crashgizmo on Sept 22, 2014 22:54:51 GMT -5
We talk about this all the time, even though DH's job is very stable. I am a worrywart. I currently work P/T and do not carry benefits, so that would be an issue. However, with my P/T take home we could scrape by with rent, bills, and super frugal eating. With our e-fund we could last 18 months or so even if we had to pay OOP for benefits (DH has a lot of meds and health issues). However, if DH lost his job we would move to a larger city where I could easily find work that would allow us to live in an apartment or smaller house until DH got something, without dipping into the efund much.
We would definitely cut the ridiculous amount of frivolous lifestyle items we currently enjoy- eating out, housekeeper, gardener, cable, etc.
This happened to our family in 2009. We cut way back on our fun money and grocery budget right away. A date night I remember consisted of dinner at home, followed by dessert and board games at a coffee shop. At the time, we had a 3 month e-fund. (With his payout, unemployment and my income, we covered our living expenses just fine, but had to take about $2k out of our e-fund to move for his new job.)
Now that DH is the only income, we have a larger e-fund, about 5 months in cash. If things got really tight, I've also got stocks and EFTs in a brokerage account that I could sell to cover a few more months. We would probably just cut fun money and groceries again. DH not going out to lunch everyday would save us quite a bit!
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We make almost exactly the same amount, and we could afford all of our obligations on one income. We wouldn't have much left over for savings or fun, but we could probably survive indefinitely.
If I stopped contributing to my 401k, we could at least afford our rent, food and rental insurance. We could sell our car and save on the car insurance in addition to the $200 we pay to park our car. We would have to cut back on eating out big time. It would be rough but I think we could manage.
Post by crashgizmo on Sept 22, 2014 23:08:06 GMT -5
So here's a question to keep it MM....for those of you who said you would live in a tent or move in with your parents (facetiously or not) would that be before or after cashing out a 401K?
DH and I both bring in about equal income. We have a 6 month efund, other savings and very little debt. Thankfully, we would be fine for a very long time.
Post by awkwardpenguin on Sept 22, 2014 23:09:41 GMT -5
I'm working part time and DW is the breadwinner and carries our health insurance, so replacing that would be the main issue. We would cut out eating out, cut back on groceries, and stop Roth IRA contributions. We could last about 4 months on our primary efund and another 2+ years on our backup efund.
We've decided to make a career change and sell our business so we're actually about to go through this income shock some time in the next year or so. ::poof::
We've kept 12 months e-fund of our old spending so we'll be fine for a while. But right now we're trying to live like we only have my new potential income. So we've gone down to one rental home, replaced H's 2 cars (leased) with ONE that is muuuuch less in payments (and environmentally friendly), and now we're trying to stop spending on random stuff that we don't exactly need. We have plenty in investments and if we keep reinvesting, I think it will be enough for retirement so we shouldn't have to worry about saving our new incomes.
Once I find a new job, H will start the selling process. But who knows how long that will be since I suck at interviews.
So here's a question to keep it MM....for those of you who said you would live in a tent or move in with your parents (facetiously or not) would that be before or after cashing out a 401K?
Before. I don't want to live there now but I certainly don't want to later in life!
Right now, I primarily SAH and do freelance work. If DH lost his job, I would immediately start job searching for something full time.
No eating out, period. No clothes. Trim grocery budget severely. Postpone as many purchases as possible. Suspend all subscribe and save items except baby supplies. No travel unless prepaid (for example, going to our hometown for Christmas).
Basically, no discretionary spending at all.
If we cut to that, I think we would make 6-7 months before we started needing to pull from investment accounts, ask parents for help, consider moving back to our MCOL hometown and breaking our lease in VHCOL. This assumes I also would not find a job in that period and that neither of us could get temp/consulting work, which is probably unlikely.
So here's a question to keep it MM....for those of you who said you would live in a tent or move in with your parents (facetiously or not) would that be before or after cashing out a 401K?
Before. I don't want to live there now but I certainly don't want to later in life!
This is why you are way more MM than me. You are totally right, and yet I think I would still cash out a 401K before the tent thing. Or my parents house, because I would share a room with 3 cats and a futon.
Before. I don't want to live there now but I certainly don't want to later in life!
This is why you are way more MM than me. You are totally right, and yet I think I would still cash out a 401K before the tent thing. Or my parents house, because I would share a room with 3 cats and a futon.
To be fair, we have a 12 x 12? 16? foot wall tent with cots and wood stove. We would be warmer than you in the winter time!
I work p/t, but I have the ability to work f/t, and at my hourly rate I would come close to covering his salary, so financially not much would change. Oh, except we'd need to find some insurance, so that would bring us down some. We do have about 6 months of e-fund if we take them out of daycare.
Also, as an ultimate backup plan, my mil holds our mortgage so there's pretty much 0% chance of losing our house unless we can't come up with the tax payments, and that's a huge comfort (we do pay our mortgage on time and she earns interest from it so it isn't the worst option for her)
We have a healthy amount of investments that we could live for quite a long time although of course I wouldn't want to tap into that. To be honest, we'd probably move back to our old town. With my job I'm paid the same amount in either town and it's a lower COL.
The first things to be cut would be dinners out & travel as those are "easy" cuts. Right now we don't even have a housekeeper or gym membership to cut!
We'd eventually be screwed since DH is the only one with an income, but we'd tighten our belts and be able to ride it out for a year or a bit more if he wasn't able to find another job with comparable income. (I have some faith that he'd be able to though.)
So here's a question to keep it MM....for those of you who said you would live in a tent or move in with your parents (facetiously or not) would that be before or after cashing out a 401K?
I would live in a tent or with family before cashing out a 401k. To me, that is simply not an option is consider unless completely dire. Though I also like camping for fun...
H and I earn similar incomes. If we stopped 401k and IRAconteubutions and cut back on savings and spending, we cold cover all bills monthly. We also have about 1 year of expenses saved if we both lost our jobs at the same time and had 0 income.