Unemployment’s impact on our finances

While I’m enjoying my “retirement,” I can’t help but think about the major impact to my future financial self. Over the last seven months, I should have banked another $50k, minimum. When I look 10, 20, 30 years in the future, that’s a huge hit to my future net worth. Ah well, here’s hoping an offer comes through soon. I have one very promising opportunity, and I’m still trying to get more resumes and applications into the pipeline in case it doesn’t come through. And even if I get the job, it will pay substantially less money than I was earning at my last job.

Before I get into details, let me just say one thing…BEING DEBT-FREE IS UNBELIEVABLY HELPFUL in times like this. It’s enough to think about how to cover regular monthly expenses of food, gas, utilities. NOT having to worry about mortgage and car payments is just…WOW. It’s hard to explain a certain level of peace. Yes, there is still discomfort, but it’s not nearly what it could be.

We’ve been debt-free for the last five years, and in that time, we’ve accumulated a decent amount of savings, which is certainly helpful when a big chunk of your income goes away.

You already know that I’m a huge fan of YNAB budgeting software, and yes, OF COURSE, I’ve been using it to determine how far I can stretch my severance and unemployment pay in conjunction with my husband’s income. And I’ve even been modeling what my monthly budget could look like with this job I’m hoping for.

As a summary, here’s what we’ve faced in the last seven months:

And I haven’t even touched my emergency fund, which holds a little more than my original severance check.

I hope to have an income by December. If that happens, I will still have about $22k of my severance left. I will assign those dollars to jobs that I need to increase our comfort level into next year…padding the car maintenance and vacation funds, starting a car replacement category, taking care of some trees we’d hoped to have removed last Spring, and catching up on some charitable giving that we’ve cut back on.

If for some crazy reason I DON’T have an income by the time the severance runs out, I really don’t want to dig into my emergency fund. I will try to find some work in retail, or anywhere else, that can help to cover the bills. Hubby would also likely cut his 401(k) savings even more so that we wouldn’t have to chip away at our hard-earned emergency fund. Because it truly wouldn’t be an emergency…yet.