getting laid off - words of wisdom?

[StepRightUp]

Hi all,

As a result of a layoff, my last day at work is Wed June 14. I'm 39 and single, renting in the Boston area. I'll feel a little better running things by you all as I move into a new phase here.

Here are my non-retirement accounts along with the number of months of living expenses (including COBRA) associated with them:

Checking and Online Savings accounts: 4.5 months
Severance and PTO payout: 6.5 months
TRowe Spectrum Income: 2.25 months
Vanguard 500 Index Admiral Shares: 4 months
Total months: 17.25 months (before possible unemployment benefits)

Questions:
1. I'm assuming I should halt my Roth IRA monthly contributions. Anyone say otherwise? I can backfill when I get a new job. (I'm not contributing right now to the TRowe and Vanguard accounts.)
2. Any reason to adjust any of the above? I'm thinking the Vanguard and TRowe accounts can stay put?
3. Am I missing anything? Any words of wisdom from those who've experienced a layoff?

Thanks all!

[disneysteve]

Sorry to hear about the job loss.

You look like you're in pretty good shape with a healthy EF plus the severance and PTO.

I agree that you should hold off on the Roth contributions until you start a new job. You have until April 15, 2018 to make your 2017 contribution so you've got plenty of time.

I don't think you need to change anything else except for possibly trimming excess spending to stretch out your funds. Your severance alone should be plenty to hold you over until the new job starts. You probably won't even have to touch your EF.

Where are you in the new job process? Anything definite lined up yet?

[97guns]

I've been layed off 2 times, both times I collected unemployment for the maximum 18 months, first time I was laid off the state offered me free vocational schooling with job placement. I opted for truck driving school and had a job a few weeks after my unemployment stopped.

One more reason why I don't give money to panhandlers, there are so many recourses out there to get work if one truly wants to work, these people have no desire to work and I won't help these kind.

My only advice is to collect the unemployment, you paid into it and getting laid off is the only way you will get it back, I collected around 30k in unemployment funds

[disneysteve]

My only advice is to collect the unemployment

I wasn't even counting the unemployment. If you've got that coming in until the next job starts, then you definitely shouldn't need to touch your EF. You may even find that you've got enough excess to still make your Roth contributions since you'll have unemployment and severance at the same time.

[StepRightUp]

That's reassuring, thanks. I thought I was in good shape.

I do not have anything lined up and I'm going to take some time to figure out what I really want to do next. I'm going to miss the organization I'm leaving more than the work actually.

Yes, I have only begun exploring unemployment but will be sure to apply.

I'm considering this a rare opportunity I don't want to squander. Most folks understandably don't voluntarily leave their job and take time off. So I'm going to be deliberate about what I want to get out of these months.

And part of my severance is my organization offers career counseling/coaching services for three months. I'll take advantage of that too.

[Fishindude77]

This is a great opportunity to make a significant life change such as relocation, if you've ever considered it. You're single and in decent financial shape so can pretty much do whatever you want.

Do some fun things and enjoy this time off, before you get back to work.

[StepRightUp]

Do some fun things and enjoy this time off, before you get back to work.

Good suggestion!

[disneysteve]

Do some fun things and enjoy this time off, before you get back to work.

The one and only time I was out of work we took a 10-day spur of the moment trip to Disney World and a 1-week trip to Las Vegas that had been previously planned to attend a medical conference. The rest of the time, I sold on ebay full time so spent a lot of time going to yard sales, auctions, flea markets, and thrift shops to buy merchandise.

[snafu]

It's typical to apply for UI benefits as soon as you get severance documentation. There are a ton of requirements for eligibility which are based on unemployment numbers in your specific community. Your employer has paid premiums on your behalf and it's definitely in your interest to learn the requirements, wait times, disqualifiers so as not to leave free money on the table. The best time to learn the requirements are now, before you apply. Talk to Human Resources, UI counsellors, Librarian [knowledgeable people] as legislation changes frequently.

You must show you are actively seeking work for example. If there are courses being offered that includes UI benefits I hope you'll sign up to expand your skill set and extend UI benefits. If you are reported as on holiday, you lose eligibility.

[AnnieG]

Depending on state law, the severance package may make you ineligible for unemployment for some time.

Cut any optional spending. Personally, I would be wary of advice to splurge on fun or vacations.

In most fields being unemployed for more than a short while can make it very hard to get a job, so I would suggest not letting the healthy amount of savings that you have slow down the job hunting.

[TexasHusker]

Getting laid off can end up being the best thing that ever happened to you, and it sounds like you have plenty of powder to keep you dry for months.

Six months is a LONG time - plenty of time to improve your career. That is a very generous severance/PTO payout that most would die for.

Honestly I would take two weeks off and cool your heels, get your mind off of work for a bit.

Keep us posted on how where you land!

[StepRightUp]

Great advice all around. And yes, I will be careful not to be out of the game for too long to the point that it hurts my chances of securing a new job.

Yes, I need to investigate the UI details. I don't want to leave money on the table and am also mindful that there are eligibility requirements I must meet--but I must learn precisely what they are.

In the meantime, I'm also in the process of guaranteeing I have a new phone and service after I depart. (I was lucky enough to have that covered by my employer.)

[MonkeyMama]

Congrats on being well prepared! From experience, I can say that it feels awesome to consider options and opportunities without financial pressure. I'd personally go for the "relax and enjoy" route. But this is given tone of your posts and how together you seem to be about it all.

[~bs]

apply for unemployment immediately once you're laid off. I believe your severance and pto payment aren't counted towards additional time worked. so the day after your last day, you should probably be applying.

treat it as a possible extended vacation that is a rare opportunity to get during your working years, but don't get too lazy and carry it too far. Keep looking for good employment.

[Gailete]

You are at that perfect time in a life, getting laid off with a decent severance pay and additional savings. I got laid off one day and was to get some severance pay, not like yours but better than nothing. Came back into my office and found a co-worker had just accepted a new job and suddenly I was still on the payroll. About 6 months or so later I quit the job with no severance and no hope of unemployment. I just couldn’t stand it anymore. So, I find the spot you are in very promising. You can take the time to pull up those old ideas of what you want to do with your life and see how they line up now.

Depending on your severance package, I would continue paying into your Roth as if needed you can always pull out the principle if you need to. The one thing I would caution you about is to not re-sign another lease for where you are living unless you are dead set on living where you currently do. Would you want to take a job and then get hit with all sorts of fees, for breaking your lease. You may have to talk nice to your landlord to get a 3 or 6-month lease extension, but finding a job that you can make 3 times as much that you will really love will cause some angst if you have just signed a nearly unbreakable lease and the job is located 5 states away.

I would also suggest finding some volunteer activities for several reasons. Job hunting is hard to do 40+ hours/week and you will need to do some other activities as well. You may find that you will be volunteering with other people that have lines on jobs that you would never have heard of as well as meeting some new friends. If you work in a soup kitchen or the like it will help you to realize how evern without a job, you are so much better off. New employers should also take it as a positive sign of a non-lazy employee. If I had a choice of hiring one of two people, one that knows everything about the job but you hear they are lazy and one that doesn’t know all the aspects of a job but is the most non-lazy person you have ever seen, I would take them any day of the week above the fully trained but lazy one.