Tuesday, March 2, 2010

Enough of the Talk, Reality Hits

Remember all the posts and talk about preparedness last year? Well, the rubber hit the road for us yesterday in the form of D being told that he and others are being downsized in a month.

When I got the call, I immediately got into my triage mode whereby I become very quiet and serious, ready to go. D deals with things differently and likes to make light of things when really, I know he is fuming mad and in shock.

I was waiting for him just to come out and say how he felt -- but he is a guy and I knew that underneath all the "it's ok", there is emotion there waiting to come out. It is the first time this has happened to him and I know he was hoping to go through his whole working life without experiencing this.

Meanwhile, I worked on my spreadsheet and made a list of things to discuss. We plan our life/lifestyle based on the idea that we are each other's back up. That one of us can carry the load should the other be unable to continue for any reason. This tests just how accurate we are in our planning.

So, I had to reacquaint myself with the numbers that D is responsible for, plug them into my spreadsheet after finding out just how long his regular pay, severance, bonus (yes, he did get one) will last. The point it runs out (assuming no new job yet), is the switchover point for us. I will takeover then.

It looks like it will be mid May/early June, depending on how much the tax man takes from the severance. He has been with the company 3 years and got 8 weeks as severance. I believe it to be really good as I think they only have to pay 1 week for every year of service.

Other steps we are taking to hedge ourselves include changes to our mortgage payments. I have decided to temporarily stop mortgage prepayments and keep the money as cash. Also, as I get paid bi-monthly vs. D's bi weekly, I've changed our mortgage frequency to bi-monthly just in case it goes that far.

That move increases our amortization by 5 months as it eliminates the extra month of payments but I'm hoping this will get switched back in no time. I'd rather be over prepared and not need it than be under and have to draw from our non registered savings. Don't want to do that.

As I don't like to leave any stone unturned, we also talked about cancelling upcoming trips. After looking at cancellation fees and penalties, it looks like the money we get back may not be worth it. We have time to revisit it later. My trip to Iceland is very soon and too late to change. Hate leaving at this time even though D says he is fine with it.

We went as far as projecting what we would do a year from now should things stay the same. Technically, as long as I can hang on, things would be ok. D is also learning about unemployment insurance and what that's about.

Our trump card is the cottage. This would be a good time to put it up for sale and interest rates are low and people would want to have it ready for the season. It is paid for and if sold, we would be mortgage free. We aren't ready to let it go yet, so we will revisit this option in a year, if necessary. And selling the ski condo is, at least right now, non negotiable for either of us.

Meanwhile D has applied for a number of positions and hopes to be called for interviews shortly. Also, should he find another job within his current company before his termination date, he forfeits his severance as things would just continue on as if "nothing happened".


  1. I'm really sorry to hear about D's work situation. It's a very good thing that you are as organized as you are with all your financial stuff. I can only imagine how people deal with this when they are financially unprepared. Good things always happen to good people so hang in there and I'm sure things will turn around soon.

  2. I'm sorry to hear that. I do hope D finds a job he enjoys soon.

    Things may happen anytime, the most we can do is to be prepared. It seems like you have gotten everything planned out ~ good for you!

  3. I'm so sorry to hear about this! But I admire your focus and the fact that it hasn't even happened yet and he's already doing research into unemployment insurance, he's already applied for new jobs, you've sat down to talk finances, and you don't seem at all panicked. I'm sure he's angry and shocked - who wouldn't be? - but as Sue said, it would be infinitely worse if you were financially unprepared! This is an excellent example of Emergency Preparedness in action!

    Good luck to you both! Hang in there. I just know things will be on the upswing again soon! {hugs}

  4. Thanks so much Sue! We try to be as organized as we can. D has had a slew of phone calls from co-workers and after conveying their shock and dismay, funny enough, the conversation has steered to how they would handle things if it happened to them.

    D has yet to hear someone tell him they would be able to continuing living without a blip. It has helped him to feel better that as much as this is an inconvenience, it isn't the disaster it could have been if we didn't manage our lives the way we do. We are really thankful for that.

    Hi Sandra!

    Thank you! I have passed on all the good thoughts to D and he is very appreciative of it.

    I think work loss is often harder on men than women as their identities can be very much linked to what they do.

    Like you, I like to be prepared, even though some people may think that planning for something no one wants to happen is being morbid.

    @ Northern Living Allowance;

    Thanks for writing! We'd like to think that we haven't missed much of a beat on this. What will happen and how long will it last? Who knows. At least we have done what is within our control.

    Today is the first day he is physically going back to the office so it will likely be tough on him.

    On a great note. One of his colleagues has offered to retire a few months earlier than planned if it could mean D gets his position. Isn't that an awesome gesture?

  5. Wow, that's got to be tough. Sorry to hear about that. I've never gotten laid off, but I've come really, really close about a half dozen times. That I didn't get the axe just seemed like plain luck once or twice.

    Sounds like you both have a good plan. He may even end up with a much better job when it's all over. You never know!

  6. Thanks S.B.! That's what we are hoping. You never know what the universe has in store for you!

  7. I'm sorry to hear about the layoff but you've already got a well-calculated plan in place and that's admirable. I wish you the best of luck as you deal with the next steps of this downsizing and I hope that he'll secure a position long before the switch point.