We don't have a cash e-fund. I just went back to work and now, we could survive on either income. However, when I was SAHM we would rely on severance (likely 6 months worth at a minimum), take a break on paying the mortgage (our bank allows you a few months without payments), use non-registered retirement savings, line of credit, and/or our retirement savings if we had to.
Post by iheartbanjos on Sept 23, 2014 13:03:27 GMT -5
DH and I both make a similar amount. We have very high pay, but volatile jobs. We would be okay on either income, but if we both lost our jobs at the same time, our efund would get us through 6 months, general savings could get us through another 6 months depending on what projects we were working on/saving for, and our non-retirement investments could last us quite a bit longer. The chances of a layoff affecting one of us in our career is quite possible, so we took the time to make sure we are protected.
Post by explorer2001 on Sept 23, 2014 13:59:13 GMT -5
@ruralrabbit1 hugs. I know the feeling.
It scary to think about. I have a month of vacation time that would be paid out, a small e-fund, and access to credit and unemployment. Then I'd be looking at pulling from retirement. Renting out my house and either getting a tiny apartment or moving in with friends. Friends would come before family. I'd move in with my grandparents before my parents.
I would be looking immediately. I have a few people I could call in my network and have a job, so that's good. But pay and benefits would not be as good as here. Plus I might have to move and because specialized here I would have to do some retooling. Thankfully accounting is an in demand field.
Post by onomatopoeia on Sept 23, 2014 14:10:34 GMT -5
Our primary is DH. This actually happened a few years ago, and while it was tight we were okay (thank god for EI, and my salary, and our modest home and mortgage). We had to dip into savings when our boiler/water heater needed replacing, and then again when DH finally got a job after a full year off and we needed a new car (his last job had a company car, and we were a one car family for that year).
Things would be the same way now. We'd have to cut out a lot, but we also have a lot of "extras" - cable, kids sports, cell phones, beer and wine, pizza nights, after-school care, gym memberships, etc. We would be bare bones but would be okay on a month to month basis.
I'm the breadwinner so we would be living on H's salary. Which is fine except his company's health insurance is crazy expensive. So up to 50% of his take home would likely go to insurance unless we could find an ACA plan that worked out better.
Cuts we would make - stop extra SL payments, stop charitable contributions and retirement savings, cut satellite TV, cut my cell phone, pull kid out of daycare, possibly be a one car family, strict budget for groceries, necessities, clothing. I have a company car which would obviously go away; we could swing a car payment (or buy in cash) but I would try to do without for as long as possible.
Our e-fund would last 6 months or more with the above cuts. After that, we could pull from investment account for another year or two. My goal would be to not touch any e-fund or investments, but I think we would come up a little short each month just on H's salary. We've lived on just my salary before and actually were able to save during that time period so I feel confident that we would be okay on one income. I would likely work evenings/weekends in retail to bring in extra while H could watch the baby.
H is the primary breadwinner in our household by far. He earns about 5-6 times what I do in a year. We'd have to make some cuts if I remained in my current, PT job and would be able to survive off savings for several months. If I were working FT, we'd be fine for at least a couple years assuming all I had to cover was mortgage/utilities. Our gas/commuting costs would drop significantly if H were to be home. We would definitely have to be better about meal planning, we'd cut cable, eating out, travel (a huge spending category for us) and most/all of our savings. It wouldn't be pretty, but it is doable. If there were any major house repairs/expenses we'd be screwed unless we were able to hold on to our savings and pay expenses using my salary alone.
This actually happened to us. Kids were taken out of child care/preschool obviously, which saved $1800 a month. Canceled cable, extremely limited restaurants and Target trips, used more coupons, shopped sales, no babysitter, family activities were of the free variety, I started selling stuff I crocheted on Etsy, and really watched every penny. My income plus our emergency fund kept us afloat for six months, and he started a new job right as we were down to our last $1000 in the bank. The same would happen now, except the older kid would go to public school instead of private. I'm rebuilding the emergency fund after paying off a credit card and trip to the emergency room over the summer. We could make it on one income now, probably, because we refinanced our house right before he went back to work and the payment went down by almost $500. I would rather not try it, though.
Post by lauren170 on Sept 23, 2014 18:55:31 GMT -5
It happened to us. I had a 1 year severance the company couldn't get out of - and it took me 1 year to find a job that pays 25% of my old one (I was very overpaid - it was not a normal situation). We'll get by for a year or two more and then have to decide if we sell our house.
But we have been through this scenario when H, who made all the big bucks then (what we make combined now), was unemployed for about a year. We sold our house, cut out most extras (NOT my cable lol), and used up all our savings that year. We made it work and I was only making 30 or 35k at that time.
We'll need to make some cuts and dip into savings. Things would be better if our other house have sold. I don't think we'll pull the kids out of daycare, maybe change to part-time but pulling them completely out would be one of the last things we do.
I really hope H will get the promotion he's been after since it comes with a severance of 1-yr of salary.
Post by jerseyjaybird on Sept 24, 2014 10:13:16 GMT -5
I'm the primary breadwinner, and our e-fund would last exactly zero months if I became unemployed. Happily, my employer is VERY stable and made really minimal lay-offs even in 2008-09, with none since. What keeps me up at night is getting to a place where we would be doing well even if I had to take STD. Once we sell my DW's house (currently rented at a loss), we should be there.
My DW is currently on STD and I've taken on extra freelance work to make up the shortfall. It would be VERY painful but possible to lose her income.
Our current situation is embarrassingly not MM, but improving.
Post by wanderlustmom on Sept 24, 2014 12:03:49 GMT -5
It would be bad if DH lost his job but I could ramp up my hours enough to pay the mortgage and keep us afloat. We would change back to a 30 year, stop vacations, stop eating out, no home remodels, no kid activities. We would also need to pay for health insurance since I am self employed. Social worker as breadwinner with a family of four and four pets would not be pretty but DH and I are both good at being no frills when we need to. We don't want to uproot and move to Houston, but he's a chem E and we'd do that if desperate.
We could live bare bones on our savings for probably 6 months before we'd need to do something drastic, like cash in retirement, sell our house, move someplace smaller, sell belongings, etc.
We wouldn't give into our impulse buys anymore. I'd take overtime whenever it's available. I'd bring food to work instead of eating out.
Other than that, we don't have any debt other than the house. No cable bill, no monthly gaming costs, student loans, nor car loans... Maybe cut down on our electricity usage...
Won't be randomly buying interesting cheeses and such when we go shopping. No more stops at the liquor store just for a cart load of pumpkin beer