With the upcoming layoff cycle, we’ve been looking at how we’d be affected if it happens to us. Chances are possible of Mrs. SSC getting cut, mostly due to the heavy, ~30%, cuts they’re making in her department as well as up to 20% business unit cuts. If you read the last post on this you might think, wait, wasn’t it only 12% cuts reported? Yes, yes it was, however, the biggest hit is geoscientists, so while overall it averages out to 12% company wide, the geoscientist group is getting hacked at 20-30% across the board. Yeeowch!
This affects us way more than I first thought. I figured, eh… we should be okay, just a little tight on savings, but then it sparked conversations on life, what we really want, if this career path is even fulfilling enough to go back, and if not, then what? I mean, this could drag out into at least 3 posts, haha! Don’t worry, I won’t belabor you with that, unless it’s still on my mind in a week and I haven’t found something shinier to focus on. I’m sure I could think of another music analogy post… Seriously though, beyond the financial part of all this is the innate thing we’re all searching for, and that is “what do I want to do, that I can get satisfaction from and get paid for?” Currently, that’s not Mrs. SSC’s job.
The other bigger conversation that has been brought up is, what to do next? I mean, Mrs. SSC hasn’t been happy at her company for almost 5 years now. Anyone else see how this timing ties into when Mrs SSC began plotting for FI? Haha! Coincidence? Heck, no!
For most of life we get driven to go certain ways in life or down prescribed career paths by our parents. For Mrs. SSC it’s even more extreme since she is very self-driven. She’s been driven to work hard, get a degree, work harder, save well, and all the other things will sort themselves out with life. At that point you’re already successful, so good job! For me, well I was driven to umm… well… I mean come o,n I was aspiring to be a long haul trucker for the glamour of it. Not exactly the same upbringing, and so let’s just say I took the long loopy path to where I am, and in the midst of all of that, I got to find myself. Mrs. SSC hasn’t had that experience yet and so she’s kind of wanting some time for that self-discovery that she missed when she was younger.
Personally, I think she’d be just as happy working in a bakery decorating cakes, and doing something she can see real results on. I loved working construction and getting to see an empty field become a hospital, or an empty plot of land turn into a house, it’s amazing when you see what you work on turn into something, anything, and not just be a nebulous “ XX barrels of oil/day produced”.
The beleagured point of this is that Mrs. SSC isn’t even sure she wants to go back to this field if she does get laid off. One of my colleagues recently brought up that 50% of people that get laid off in the Oil & Gas industry don’t come back. I’m sure that is an overblown number, but I know over a handful of associates that are okay with walking away for good if they get laid off. Straight up not coming back and finding something else to do with their degree. They have spent YEARS in school working on those degrees to work in this field. Now, if laid off, they’re content looking into gov’t jobs, academia, and even jobs with nothing related to their degree at all.
Ever since one of our friends got laid off this spring, we’ve been working to see how this would affect us if it hit either of our companies. Well, it’s going to hit us in a few different ways but like most people, it starts in the wallet. We maintain a pretty good savings rate of about 50%. So, if we lose one salary, our savings rate would effectively be 0%. We are fortunate to be way ahead of many colleagues, since we generally live off of one salary already. Maybe even a little under that, but for the most part, all of our “essentials” can be taken care of alright with one salary. It’s not nearly as stormy an outlook as I was thinking at first. Plus, Mrs. SSC might get an added bonus of a forced “get to know yourself and what you want to do.”
If a layoff occurs, we would have to find a way to move that savings rate from 0% to hopefully 10%, just to keep FI happening before we turn 50. We’d leave our oldest child in daycare full-time because he thrives well there and does great with the structure, friends, and the like. He will be in his last year before kindergarten, so it’s not a long-term bill, maybe 6 more months tops. Our youngest could do well with a 2-3 days per week/part time day care situation as she seems to be more independent and is a super fast learner. Plus, Mrs. SSC is looking forward to having time to spend with her and help her learn more too.
The biggest obvious budget hits are just the other luxury allowances we have now that would go by the wayside. These are the same things that will get cut with the FFLC anyway, so nothing to drastic yet. I’ve saved us about $1200 this year just doing the yard all season (it still has about 3 months before it ends) so that’s good, and we’d cut the maids saving us $260/month, and then Mrs. SSC parking and work gym would get rolled into an outside gym fee, which would likely even out. That’s her hobby, outlet, and she likes it and uses it, so we’re both good with that. Plus, we would be saving quite a bit on tolls and gasoline, since each commuting day is the equivalent of ~2.5 gallons of gas or ~$9, and $2.50 in tolls. At 220 working days a year, that is just over $2530/yr. Maybe we could even get the car insurance rate dropped on her vehicle too! Groceries budget could easily go down by $50-$75/month since Mrs. SSC would have time to shop for better deals, and we wouldn’t have to buy ‘convenience’ foods anymore. We could likely trim another $25-50 of general spending a month for the same reasons.
When we looked at our FFLC date, it is a different story though. First off, I’ve gotta give a shout out to my man, compounding interest! Yeah, that’s my boy!! We’ve been good at feeding our FFLC accounts so they’ll still be working in our favor, hopefully. With our savings effectively reduced to 0%, we know we’ll just have to play a couple rounds of “what expense goes next?!”. We’re assuming we can still save at least ~$1k/month/yr and then increase it by $1k/month the next year due to my raises and maybe Mrs. SSC getting a part-time gig. I think we may be able to save more, especially if we make it a challenge. Take that and assume a 6% investment growth, and we’re still looking at mid 2020 for our FIRE date! We’re not looking at a date as early as ThinkSaveRetire, but we’re still doing better than most in this downturn since we still have an early retirement date before we’re both 45!
That’s a lot better than I was thinking initially. It helps to know your target number, and be aware of your budget, because of the case in point. My mind totally blew out of proportion how negatively we’d be affected, and then you do the math (I try to not ever do the math) and it’s like, “whoa! We got this, and we can adapt. Alright then… We can do this!” And then hope we don’t have to do this. Until we find out what we’ll be doing exactly, we’re just going to keep on, keeping on.