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Budgeting for Layoffs? 186

Posted by Cliff from the preparation-for-living-without-a-paycheck dept.
The Waxed Yak asks: "After reading the Slashdot tech worker unionization story, I started wondering: What are other IT workers doing to prepare for potential layoffs?"
"We're all at risk of it, be it from actual layoffs or loss of employment for other reasons. My personal approach has been to live off about 1/3rd of my earnings and bank the rest, even though that means living in a hovel and driving an older car. Worst case scenario, I get to retire early.

I recently became completely self employed, which has made it all the more important to save. I understand many Slashdot readers have families to support, so they don't have the same option for savings that I currently enjoy. As I hope to have a family to support in the near future, I would be interested in tips or techniques to prepare for this situation. Judging by the posts in the unionization thread, many of you are dependent on a steady income to provide for their families. Hopefully this thread can provide some ideas for them as well."
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Budgeting for Layoffs? More

Budgeting for Layoffs?

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  • Question or Comment??? (Score:4, Funny)

    by ericspinder ( 146776 ) on Saturday May 13, 2006 @07:34PM (#15326960) Journal
    The Waxed Yak asks "When I did work for someone else, I saved 2/3rds of my pay, but since I'm now self-employed, I'd like to really brag", "what guestion do I have to come up with so I can say so on Slashdot?"

  • Me personally (Score:4, Insightful)

    by mikesd81 ( 518581 ) <.mikesd1. .at. .verizon.net.> on Saturday May 13, 2006 @07:34PM (#15326962) Homepage
    Right now I'm a machine operator @ Sealy components. It's a mechanical job. Yes I'm a geek, but I like mechanics too. There's 2 things a people will always have (relative speaking, let's not nit pick here): an automobile and computer.

    Also, no matter how automated a plant may get, there still needs to be a person to fix the machine when it breaks.

    Okay so my point is to always have a back up plan to fall on. You have more interests, I'm sure, than just computers. Capitalize on them. Wheather it be mechanics or landscaping or whate have you.

    In the last James Bond movie to feature Q: "Never let them see you bleed, and always have an escape plan."

  • Other fields (Score:5, Funny)

    by heinousjay ( 683506 ) on Saturday May 13, 2006 @07:53PM (#15327046) Journal
    Work on your smooth pimp game, round up a stable of hos, and watch the money roll in with a modicum of effort.

    Sure, pimpin ain't easy, but that don't make it hard.

  • Budget (Score:4, Interesting)

    by daeg ( 828071 ) on Saturday May 13, 2006 @08:01PM (#15327077)
    I'm in a two-income no-kids (DINK) situation. I'm still paying off student loans. We live very comfortably but I have a strict 20% to retirement rule. For the past two years (roughly) we've been putting 30% into general savings. We could reduce it easily since we both work in very steady industries (him: high rate commercial insurance, me: television station). It is nice to know that just on the general 30% savings one of us can be without work for years and we'd never have to tap retirement. BTW - I'm 22, He's 30. Still a long time until retirement and our health care costs are quite low.

    However, as such, that money is invested quite aggressively. I make stock purchases that tend to be risky. Of course, it has paid off even in the short run, with the 30% savings pushing near 45% annual gain (not including additional cash put in).

    I'd rather live modestly for a long period of time than live well and spend a lot only to lose a job and have to risk moving back to a frugal lifestyle.
    • I'd rather live modestly for a long period of time than live well and spend a lot only to lose a job and have to risk moving back to a frugal lifestyle.

      This has been my approach, pretty much my whole life. Even though my family had a pretty good income when I was growing up, my parents both grew up as WWII-era working-class kids with stereotypically frugal Dutch parents. So they taught me not just to live within my means, but within within my means.

      At times I've made pretty good money myself, but I've

    • I'm in a two-income no-kids (DINK) situation. I'm still paying off student loans. We live very comfortably but I have a strict 20% to retirement rule. For the past two years (roughly) we've been putting 30% into general savings.

      However, as such, that money is invested quite aggressively. I make stock purchases that tend to be risky. Of course, it has paid off even in the short run, with the 30% savings pushing near 45% annual gain (not including additional cash put in).

      In other words, you are fooling your

      • Re:Budget (Score:5, Informative)

        by Money for Nothin' ( 754763 ) on Sunday May 14, 2006 @01:16AM (#15328170)
        Actually, there is a very good reason why investment and savings are considered to be the same thing: it's because they basically *are* the same.

        Look into how a bank makes loans, and what it does with your money when you "save" it with them. They don't keep it locked in a vault for you, like money under a mattress; they loan it back out to people, and pay you out of their fractional reserves when you come calling.

        In essence (and I'm glossing over a lot of my Monetary Policy class in college), the bank is making an investment on your behalf. They charge a higher interest rate to the loan recipient than they pay you to keep your money "saved" with them -- this is how banks make a profit.

        I mentioned being paid out of the bank's fractional reserve. Because the bank has loaned-out money to people (businesses and individuals), it doesn't have everybody's money at the bank -- it's out being spent by somebody else who thinks they can turn a profit and pay back the bank with the money they make. What happens if everybody goes to the bank and demands their money back, and the bank doesn't have enough available -- i.e., what happens if you see a bank run? Your bank borrows what they need from other banks. Worst-case scenario, they go to the "bank of last resort", a.k.a. a Federal Reserve bank. The Fed waves a magic wand (seriously, it is not transparent enough for anybody besides the Fed to know precisely what they are doing), buys/sells bonds through "open-market operations", and as necessary, creates new money -- which causes inflation. In essence, if the Fed can't handle a bank run (the last time this happened was just prior to the Great Depression, and in fact, is considered by most economists now to be the reason the Depression was as bad as it was), we're all hosed. That said, since the Depression, it has handled some monstrous ones (including Russia's failure to repay its bond commitments, which led to the decline of the Ruble, causing the collapse of some big-name financial firms like Long-Term Capital Management [wikipedia.org]). (OK, I'm not glossing-over as much Monetary Policy as I thought I would...)

        Here's a dirty little secret about the FDIC, which insures the money you "save" at the bank: the FDIC only insures about 1-2% of the nation's fractional reserves. Hence, no matter how you slice it, If another Depression-style bank run occurs, we are all fucked.

        In truth, savings and investment are considered more-or-less the same thing by economists today, because in the end, they *are* the same thing.

        Yours,

        A youngster who "saves" in mutual funds... (and in a high-rate savings account, and only what is necessary for paying bills from a checking account. Most of my savings are in my 401k for retirement though...)
        • Here's a dirty little secret about the FDIC, which insures the money you "save" at the bank: the FDIC only insures about 1-2% of the nation's fractional reserves. Hence, no matter how you slice it, If another Depression-style bank run occurs, we are all fucked.

          In truth, savings and investment are considered more-or-less the same thing by economists today, because in the end, they *are* the same thing.

          Point taken, but there's still a difference between savings and investments; with investments, you can l

          • you can lose your shirt even during the good times if you pick the wrong stocks or the wrong combination of stocks.

            That's the whole point of diversity. Losing everything in a diverse portfolio without major economic trouble is extremely unlikely. (It boils down to the law of large numbers)

        • Actually, there is a very good reason why investment and savings are considered to be the same thing: it's because they basically *are* the same.

          No, no financial professional considers them to be the same. (The slicker elements of the of the financial profession like to blur the line - because they make commissions off of investment churn, and none off of savings.) The risk v. reward ratio is, to put it mildly, extraordinarily different. (Not to mention tax issues.)

          In essence (and I'm glossing over a

          • The return on investments on the other hand is unpredictable, and may even be negative, and liquidity is a variable.

            If you invest in equity, sure. There are fixed rate investments, like bonds - they have a very predicate return. There is a risk of default, but that's just equivilent to the risk of your bank not having enough money to give you yours back (the risk is higher, certainly, but that's true throughout the spectrum of investments - higher return requires higher risk).

            A savings account is just a l

            • If you invest in equity, sure. There are fixed rate investments, like bonds - they have a very predicate return. There is a risk of default, but that's just equivilent to the risk of your bank not having enough money to give you yours back (the risk is higher, certainly, but that's true throughout the spectrum of investments - higher return requires higher risk).

              Don't keep your savings in a bank, buy gold and other precious metals and hide them behind lots of nasty traps. Then draw a map and mark the na

            • A savings account is just a low-risk investment.

              Certainly - I've never debated that, nor engaged in the semantic games that others are doing.

              What I am doing is refusing to call Red just a 'low frequency Blue'. We have different names for thing for good reasons - in this case, because the risk, liquidity, and tax implications are dramatically different between savings and equities or securities. Even though, in the abstract, they are the same thing - real world financial planning does not take place on t

          • The return on investments on the other hand is unpredictable, and may even be negative, and liquidity is a variable.

            Of course. You can factor in inflation too to determine whether you're really making a real return on your investm-- err, "savings".

            As Tango42 notes, what is generally thought of as "savings" is really just a low-risk, low-return investment. Perhaps it makes sense to classify them to the broader public as two different things, so that understanding the risk/reward ratio is simplified for the

          • In reality, they make investments (on the behalf of the account owner) - and pay a fixed and predictable sum on a liquid balance.

            No they don't. Pray tell, how much *value* *will* the bank give me 35 years from now if I put $10.000 in the bank ?

            First, interest-rate over that period is pretty hard to predict, and fixed interest over those timespans are rarely offered.

            Second, even if the interest *WAS* fixed, that still wouldn't answer my question, because what interest me is what *value* I get out, no

            • Functionally, there are multiple difference between investments and savings

              There are differences, yes.

              But it's differences of *degree* more than it fundamental differences. Fundamentally they're the same, they differ in the details, along a continum. Some investments are more liquid than others, some have higher risk than others, some have higher expected return than others. Different investment-scenarios mean different strategies make sense. We all agree on this.

              We just don't agree that there exists som

        • Banks take your money, loan it out at 8% or 9%, then use the profits to pay you 1-2% interest on that money.

          I think it's a misnomer to say that the banks are making loans on your behalf. :)
          • Heh, well, given their yields (loan interest rate - savings interest rate) they employ, I suppose that's a fair point. :-)
          • 1-2%? We were talking about savings accounts - if your savings account pays that little (less than inflation!) you need to move banks.

            If you're refering to a current account, that's a completely different story - they exist for convenience and security, not for making money on. Most banks make money on current accounts from charging fees, not from using the money in the account - if you have more than about one month's pay in a current account, you're wasting money.
      • You, sir, are sounding very much clueless. But to give you the benefit of the doubt, please categorize the following financial vehicles as "savings" or "investments", and explain why.

        * Stock market
        * Mutual funds
        * Treasury bonds
        * Fifty shares of GOOG
        * Fifty shares of SCO
        * Bank account
        * CD
        * Real Estate
        * Blackjack
        * Under the mattress/buried in the backyard
        * Paying down debt
        * Gold/Silver/Yttrium

        As of now, you've done nothing to clarify the distinction between savings and investments, except to imply that any m

        • You, sir, are sounding very much clueless.

          Only to one who massively clueless to start with. To those not clueless, I'm enjoying a fascinating discussion/debate.

          As of now, you've done nothing to clarify the distinction between savings and investments, except to imply that any money you invest may as well be flushed down the toilet, from a financial planning perspective.

          'Financial Planning for Dummies' and 'Investing for Dummies' are both excellent books for those seeking to understand the difference. I

      • Some countries in the middle east intend to no longer take the USD
        as the standard currency for oil . The intend to switch away from
        fiat currency, aka monopoly money for lack of a better analogy to gold .

        If they switch to gold it will seriously impact the US .

        The USD is not backed by anything of physical value .

        Some members of OPEC have come to realize this, an plan to
        take advantage of the vulnerability .

        It reminds me of my time in the military in Italy buying a beer for $10,000 Lira .

        Ex-MislTech

        • Some countries in the middle east intend to no longer take the USD
          as the standard currency for oil . The intend to switch away from
          fiat currency, aka monopoly money for lack of a better analogy to gold .

          A scaremongering claim that's been bandied about since the Oil Crisis - over thirty years ago. (Mostly because switching to a currency your customers don't use is generally a bad idea. OPEC is vain, self centered, etc... etc... - but they aren't stupid.)

          OTOH - they is the very real possibility that they

      • You're rigth in principle, in practice though the difference between saved and invested is smaller the longer the perspective is. (and for a girl aged 22, saving for retirement is very long-term)

        What would be "saved" in your book ? Bank-account ? What if the bank goes bankrupt, or the dollar falls sufficiently that the money loose substantial value, or inflation goes higher than interest ? Gold ? What if the purchasing-power of gold falls by 75% over the next 3 decades ?

        There's absolutely no way to make

        • You're rigth in principle, in practice though the difference between saved and invested is smaller the longer the perspective is. (and for a girl aged 22, saving for retirement is very long-term)

          You'd have a point if the portion of the OP that I quoted and discussed dealt with retirement vice short term savings.

          There's absolutely no way to make 100% certain that a certain value is "saved". Yes, there's more risky and there's less risky ways.

          Certainly. But the OP boasted of how proud she was of her savi

  • Give up (Score:2, Interesting)

    by cubicledrone ( 681598 )
    What are other IT workers doing to prepare for potential layoffs?

    W-4 employment, along with nearly all IT "skills" is obsolete. Companies and the people who manage them no longer have the huevos to employ people. They would much rather shirk their responsibilities to the communities they insist on shoving their products at. They want it all for free. They want free access to free markets with free labor and free equipment, free buildings, free services and free use of all the infrastructure necessary f
    • W-4 is the withholding form. "W-2 employment" is probably what you're looking for there. :)
    • have the huevos to employ people.

      The eggs to employ people??
    • "We, as a society, allow corporations the LUXURY and PRIVILEGE of being able to operate as corporations in exchange for certain benefits to society, among them the creation of JOBS and CAREERS and the availability of products and services. Business, naturally, is trying to fuck society by keeping the quo and not exchanging the quid, precisely the same way they are unfairly refusing to honor the original deal in the copyright laws. The reason is because they want everything for free."

      We also tax the baJEEZUS
    • Who gave the Libertarians all the MOD points?

      Hell, I've got mucho karma, so I can afford to tell it like it is. :)

      The whole reason people have to save up so much money is exactly because of what cubicledrone said.

      And to the idiot who said all cubicledrone wants is a Government guaranteed job, that's horse shit. I'm a Reagan Republican, I believe a man should work not live on welfare. You Johnny come lately laissez-faire rabid dogs that call yourselves Republicans today, want to snatch every job known to man

      • I'm sick and tired of you irresponsible "greed is good, social responsibility is communism" anti social hermits living nice and safe and comfortable in your mommy's basement posting these bogus Slashdot armchair cowboy stories about how you save 2/3 of your income to prepare for layoffs. That's hog wash and most of us readers know it.

        Social responsibility is communism, or at the very least socialism. Communism and socialism are not evil, some of the regimes that were/are or claim(ed) to be communistic o

        • Well said.

          But one thing you may not know is that in Europe - Poland, I believe - cigarette manufacturers were encouraged by the Government to drag down people's health to soften the blow of a retiree explosion crisis: by killing them off.

          By God I wish I had that news article.

  • we IT workers are the most advantageous (Score:5, Insightful)

    by unity100 ( 970058 ) * on Saturday May 13, 2006 @08:09PM (#15327109) Homepage Journal
    when it comes to layoffs.

    Especially programmers, designers, web developers, or any information technology service or counseling / technical support, anything that can be performed remote :

    We have the internet.

    When you get laid off, even in the u.s., you have the chance to put your resume & experience in a post titled 'experienced ..... looking for work/taking on projects' and shortly you get many inquiries.

    Sure wages are not that high, comparable to when you work full time on-site.

    But then again, a hourly $15 should be enough thinking you are working from home ? or from a remote site on vacation - hell, practically anywhere in the world.

    Our professions are the most suitable for the internet - no surprise, as we are the ones that built it.

    That might not seem enough, a mere $15, however there is no limit as to how many projects you can take on or at the same time how many hourly paid jobs you can manage - handle 3 simultaneous work, get $45 in total - no contractor will object to you as long as you handle their work fittingly. That is something you cant do while working on-site : work on someone elses stuff for an hour, get busted, youre in trouble.

    I understand that many have families and people to support, and quite a many have become accustomed to rather high living standards.

    So what ? if we lower our standards a bit in such times, we can work anywhere, anytime.

    And note that, not having a profession that is required to be registered, unionized, guildized etc nowhere in the world, makes us capable of working ANYWHERE.

    Too high taxes in u.s. ? Move to some other country where you are allowed to live in, just start working there. Its that simple.

    On top of that, many countries will be pleased to have more it workers.

    Unionization, regulation and etc are not to our advantage, but to our disadvantage. Keep in mind that organisations always fail to represent the masses they set out to represent - because only the rich, powerful & influential enough can spare enough resources to get on the helm of any of them. Then the result leads to manipulation and molding of the related masses to some other power's interest, and that generally becomes the industry bosses.

    So far so good, were not mine workers, we can easily find ways to sustain ourselves, heck, even prosper (we are always free to use our skills to set up our own job, and we can do it with minimum capital) whenever we get laid off.

    Maybe we are not that safe always, but, for the first time in the world history maybe, we have more freedom than any profession member had on the face of the world.

    • Re:we IT workers are the most advantageous (Score:5, Insightful)

      by cyber-vandal ( 148830 ) on Sunday May 14, 2006 @04:05AM (#15328585) Homepage
      Unionization, regulation and etc are not to our advantage, but to our disadvantage.

      A quick look at the history of the 20th century as compared to the the rest of human history would instantaneously prove you wrong. The 20th century saw the most regulation and unionisation in human history. It also saw the greatest period of social and technological growth the human race has ever seen.

      Too high taxes in u.s. ? Move to some other country where you are allowed to live in, just start working there. Its that simple.

      That may be possible for a multi-lingual 25 year old with no family or friends. How about the other 99% of the population? I've lived in 3 other countries apart from the UK and I'm telling you right now, it's not "simple" at all, and I didn't have a wife and children to relocate as well.
      • As for unionization, the past history is not sufficient to judge their value in the case of it - never before in the world history there has been much flexibility and communication and networking than internet is offering. we are not local, we are global.

        As for families, having a family and roots is ALWAYS hard whether you are unionized or not. What will happen if a plant closes and union gets a deal elsewhere ? Youll move, as a family and thats it. Whats the difference ? At least , in it field, you do
        • the internet and improved communication technology at the end of the 20th century, so had no influence on the main part of it. Try again and this time read the whole of the history of the 20th century.
          You have a weird idea of unions if you think you have to answer to them, and being a union member would have no bearing whatsoever on how many jobs I would be able to take, not that I would want to take MULTIPLE jobs when one job should pay enough in the first place. I do have a life, family and friends, I've
          • It is odd that you are proposing the objection about the unions, and their irrelevancy to telecommunications industry, to ME, as i have not proposed any idea close to it. Somebody else said that, unions being a milestone of development in the 20th century and they would help the it field too, so I suppose you should direct your objection to him/her.

            As for multiple jobs, having a union that FORCES the industry to make them pay more for a job does not mean that you will be able to get the job. In such situ

  • May I suggest a subscription to... (Score:3, Funny)

    by linzeal ( 197905 ) on Saturday May 13, 2006 @08:18PM (#15327146) Journal
    Backwoods Country Magazine [amazon.com] so you can learn to make it when they shut off your electricity and you are forced to use your 1/8th of an arable land that used to be your lawn to grow corn on and hunt neighborhood cats.
    • You may be joking, but people aren't putting their lawn space to a great enough use. We have all sorts of room to be growing hemp [illegal in the USA sadly, but makes food, paper, rope, clothing], peas, peppers, onions, and fruit bearing trees that would feed our neighbourhoods nicely, and aren't even an eyesore. It's just a myth that someone needs a lawn to look sucessful. Grass is for cattle, gardens are for people. Oh, and wild rabbits would be better eatin' than cats.
    • You have a nice sig, T-shirts of Famous Women Engineers [cafepress.com]. However, I am a bit disappointed. When I visited the site, I learned that they are new. Had they been worn, I'd have ordered a few.

  • "Be prepared." (Score:3, Interesting)

    by Deagol ( 323173 ) on Saturday May 13, 2006 @08:57PM (#15327320) Homepage
    I live in Utah, where long-term food storage is (to put it mildly) a big thing. I'm not LDS ("Mormon" to you unlearned gentiles), but my family has taken to putting away food as part of the rainy day fund. A couple of years ago, I took a year off. I cashed in the pre-tax retirement fund my employer was contributing to, and lived off of that (for the most part). It wasn't much -- about $30k after the 20% withholding, most of which was used to pay off a small loan (some remote land). My salary before my little sabbatical was about $53k/yr. The food storage we had on-hand helped to stretch the remaining $10k, which also had to pay for a mortgage and a hefty truck payment. Having a milk cow and chickens also helps the food go a long way, too. :) Had I not had the truck to pay for, we could have easily coasted along for 2 to 3 years.

    While one can't go wrong with having money in the bank (or a fund) earning interest, my family's philosophy is to reduce monetary need first then put money away. I recently downgraded my job from $45k/yr to ~$17k/yr, and our standard of living hasn't suffered.

    One poster on this thread has mentioned she doesn't wish to "risk" being forced into a "frugal" lifestyle. Our take on things is live frugally by default and you live with much worry in the long run.

    • Re:"Be prepared." (Score:2, Insightful)

      by maxume ( 22995 )
      You misunderstood that other post. She doesn't want to have to lower her standard of living because of a job loss and plans accordingly. That's not any different than what you are talking about.

  • A few key things (Score:3, Informative)

    by roc_machine ( 314714 ) on Saturday May 13, 2006 @09:00PM (#15327335) Journal
    - Keep my resume up-to-date. Most resumes you do will be custom tailored for a potential employer, but keep a generic one on hand and update it.
    - Know what's going on in the job market. For me, that includes jobs in my hometown and network management (netcool, concord, cisco, etc) jobs anywhere in North America.
    - Apply for jobs even if you think that it may not be a good fit for you. At least it provides good experience in writing a resume and cover letter, and possibly interview experience as well.
    - Keep a minimum balance in a bank account, say $7000. These are emergency funds, and I think being laid off counts.
    - If your company has a share ownership plan, get out if it, or at least make routine transfers out to another account. If the company is considering layoffs, there is a good chance they are not performing well, and that includes stock price. The last thing you want is to be hit with a double whammy of being unemployed and seeing your retirement income evaporate.
    - Whatever training you can get at your current job, take it.
    - Lastly, try and stay positive. Enjoy life to the fullest outside of work.
    • Apply for jobs even if you think that it may not be a good fit for you.

      For the love of god, please stop wasting your time... and mine... with this.

      My boss and I are are trying to hire someone, and the majority of the resumes we're getting are for people who obviously don't fit what we're looking for. They don't even bother lying to us to make it look like they are. Listen: We're not that desperate. We're not going to hire someone who just might theoretically be good at what we need after several mont

    • "Keep a minimum balance in a bank account, say $7000."

      I like to follow the general rule of thumb: first accumulate six months easily-liquidatable assets. That is, six months of your current salary. Then, acquire two years of non-retirement assets--of your current salary. When you get fired, you won't continue to consume income at the same pace. However, you will have a rough guess as to how long you can coast . . .

      Some would consider $7k one-month's assets. It's probably good to have a month in your primary

  • Over here, it's mandatory (Score:3, Interesting)

    by Opportunist ( 166417 ) on Saturday May 13, 2006 @09:28PM (#15327454)
    In theory, I could rely on the system. When I get laid off, my employer has to give me one month of payment to get rid of me, and I am entitled to 80% of my wage for 6 months.

    Usually, plenty of time to find a new job.

    Retirement is taken care of, too, so that's, at least in theory, no issue either.

    Still, I try to spend no more than 1/2 of my income. Being able to rely on the system is nice. It gives you a sense of security. Not relying on it gives you a feeling of independence, though.
    • 80% of your wage for six months? That'd be nice.

      Here in Georgia it's US$300/week max (gross before state/federal/FICA which you will owe on that) for six months, and you may or may not have gotten any severance depending on your circumstances (most programmer severance packages I've seen are roughly 1 week of pay per past year of service).
  • So what are the best resources for us engeineering types to learn about investment, stocks etc.?
    • I've learned a lot by listening to Clark Howard: http://clarkhoward.com/ [clarkhoward.com]

      He has a lot of general consumer advice, but he often talks about investments and saving for retirement.

      In general:
      1) save in your company 401k/403B, etc up to the point where your company matches
      2) then save to the max you can in a ROTH IRA
      3) then save more in your company 401K since it's pre-tax
      4) invest additional money in something like mutual funds. Pick ones with no-loads. You'll probably do well with an indexed fund like an

  • Never take vacation (Score:3, Interesting)

    by Ratbert42 ( 452340 ) on Saturday May 13, 2006 @11:53PM (#15327902)
    At my old company, nobody ever used vacation time until they were forced to. Since the company would pay it out if you were laid off, it was the only severance package most people had.

  • Someone smart once told me that in addition to savings, you should always have enough money spare to be able to walk away from your job and last you until you get a new one. This ranks as some of the best advice ever given - it gives you, especially while you're young, just that little bit of extra confidence to stand up for yourself and to push back on management, which I've found leads to a better feedback loop between you and your managers, removes 'silent grumbling', and has (in the past) lead to a far

  • There was a time when I put tried to save every cent I could - pay down the mortgage, maximize my retirement savings, etc. So what happened? An expensive divorce from a rather greedy ex-wife and most of my savings were depleted. (I was within 2 years of being completely mortgage free at the time) Now I take a more fatalistic attitute - work hard, but live more for today and try to let tomorrow take care of itself, because I may not be around to see it. (I am a type 1 diabetic, which cuts my life expectancy by an average of 15 years anyway) If you die with a million dollars in the bank, you don't get to spend it in the afterlife.

  • Been there, done that (Score:3, Informative)

    by rlp ( 11898 ) on Sunday May 14, 2006 @01:28PM (#15330036)
    I learned a few things from my last lay off. I was out of work for about six months. Fortunately I had savings to get through it. Always keep at least six months of savings available. I had a lot of stock in the company that layed me off. The layoff was a mass layoff due to the company experiencing financial problems. Needless to say, the value of the stock had dropped considerably. The stock options I'd been 'saving' were worthless. Lesson two - don't invest heavily in your employer, and cash in any options as soon as they vest.

    When you're unemployed, you need to lower your (cash) burn rate. We reduced unnecessary car trips, eating at restaurants, and most entertainment. We also shopped for food bargains and used coupons. We had several services we subscribed to on a monthly basis. Only those that were absolutely neccessary stayed. We kept internet access, as that was needed for my job search.

    We substituted free entertainment for the movies, trips, etc. That included bicycling, local parks, and books and DVD's from the library. One unpleasant surprise expense was health insurance. Companies are required to offer COBRA coverage (i.e. you get company health insurance for 18 months, but your pay. They set the price). Family coverage cost $900 per month! Had I continued to be unemployed, we would have had to switch to a (non-employer) cheaper 'hospital only' plan.

    I'm working now (ironically at the place that layed me off). My wife has re-trained (outside of IT) to provide some employment diversification. My daughter has changed her career objectives to avoid IT.

    If you're in IT, accumulate sufficient savings, prepare a contingency plan, keep your resume up to date, monitor your cash burn rate. Don't over-invest in your company's stock. Don't live beyond your means, or paycheck to paycheck. If you're thinking about entering the IT field - don't do it.
  • always keep your resume up to date. In case the place that you are working at lays you off or fires you. Right now, the company I work at has been acquired, and so I am wondering when the layoffs will begin. There are a few people I could see getting rid of.

  • Keep your skills up-to-date (Score:3, Interesting)

    by GWBasic ( 900357 ) <`slashdot' `at' `andrewrondeau.com'> on Monday May 15, 2006 @06:46PM (#15338642) Homepage
    The best thing you can do is keep your skills up-to-date.

    It also doesn't hurt to have a hobby that you can turn into a job. An old manager of mine used to do woodworking as a hobby. When he got laid off from a 200k/year job, he decided to retire from tech and be a professional woodworker. Needless to say, he's quite happy.

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