Third time in my 32 year career I have been laid off

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
User avatar
FelixTheCat
Posts: 1476
Joined: Sat Sep 24, 2011 12:39 am

Third time in my 32 year career I have been laid off

Post by FelixTheCat » Fri Oct 06, 2017 9:09 pm

I heard about some company issues last week. I got called into the boss' office and he mentioned there is no revenue in the pipeline for the next year. Effective today I am laid off. My employer mentioned he wants to soften the transition by offering me a part-time consultant position and we'll talk soon.



Emergency funds: 3 months of expenses
Debt: 0 debt. No house loan, No car loan, No credit cards balance
Tax Filing Status: Single
State of Residence: CA
Age: 55
Income: 0. Was making 125,000 earlier today. Software Developer career.

Desired Asset allocation: 60% stocks / 40% bonds
Desired International allocation: 15% of stocks

Current retirement assets
Size of the portfolio: 1.6 million not including real estate

Breakdown within each asset class:
Total Bond Market 600,000 in tax deferred
Total Stock Market 850,000 in taxable
Total International Stock Market 150,000 in taxable

Primary Home: 538,000 No loans
Rental Home: 633,760 No loans. 2,500 month rent


Questions:
1. Firecalc says I can retire on 60,000 a year for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.

2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.

3. Medical insurance for the recently unemployed? An ideas?

4. Should I file for unemployment today? Should I wait for Monday's meeting?
Last edited by FelixTheCat on Sat Oct 07, 2017 1:24 pm, edited 1 time in total.
Felix is a wonderful, wonderful cat.

student
Posts: 1387
Joined: Fri Apr 03, 2015 6:58 am

Re: Third time in my 32 year career I have been laid off

Post by student » Fri Oct 06, 2017 9:15 pm

I am sorry to hear that. I think you should be ok with your assets. I would be nervous having about 40% of net worth in two houses though.

User avatar
FelixTheCat
Posts: 1476
Joined: Sat Sep 24, 2011 12:39 am

Re: Third time in my 32 year career I have been laid off

Post by FelixTheCat » Fri Oct 06, 2017 9:21 pm

student wrote:
Fri Oct 06, 2017 9:15 pm
I am sorry to hear that. I think you should be ok with your assets. I would be nervous having about 40% of net worth in two houses though.
I live in CA. Housing keeps going up. My rental just increased rent by 400 a month. Should I be concerned?
Felix is a wonderful, wonderful cat.

User avatar
Sandtrap
Posts: 2758
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳

Re: Third time in my 32 year career I have been laid off

Post by Sandtrap » Fri Oct 06, 2017 9:23 pm

Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? Not yet. I have not even considered retirement yet. I am thinking 62.Yes. . or later. 65 is medicare, etc.

2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.Looking for a job right away preserves your income stream. Secondary is making an equal or better salary. Not having to tap into your reserves is important.

3. Medical insurance for the recently unemployed? An ideas? COBRA, and other policies will cover the gap until the next employment hopefully. Research this. If not then you will have to apply for ACA in your region.

4. Should I file for unemployment today? Yes. It takes time for the payments to kick in. Again, preserve your income stream. Should I wait for Monday's meeting?
Sorry to hear about your dilemma. Good luck. It will get better.

student
Posts: 1387
Joined: Fri Apr 03, 2015 6:58 am

Re: Third time in my 32 year career I have been laid off

Post by student » Fri Oct 06, 2017 9:24 pm

FelixTheCat wrote:
Fri Oct 06, 2017 9:21 pm
student wrote:
Fri Oct 06, 2017 9:15 pm
I am sorry to hear that. I think you should be ok with your assets. I would be nervous having about 40% of net worth in two houses though.
I live in CA. Housing keeps going up. My rental just increased rent by 400 a month. Should I be concerned?
I do not know what is best. It is just not diversified enough for my taste.

Dottie57
Posts: 2380
Joined: Thu May 19, 2016 5:43 pm

Re: Third time in my 32 year career I have been laid off

Post by Dottie57 » Fri Oct 06, 2017 9:31 pm

student wrote:
Fri Oct 06, 2017 9:24 pm
FelixTheCat wrote:
Fri Oct 06, 2017 9:21 pm
student wrote:
Fri Oct 06, 2017 9:15 pm
I am sorry to hear that. I think you should be ok with your assets. I would be nervous having about 40% of net worth in two houses though.
I live in CA. Housing keeps going up. My rental just increased rent by 400 a month. Should I be concerned?
I do not know what is best. It is just not diversified enough for my taste.

I don't know what is best either. For me it is that real estate is not liquid.

stan1
Posts: 5022
Joined: Mon Oct 08, 2007 4:35 pm

Re: Third time in my 32 year career I have been laid off

Post by stan1 » Fri Oct 06, 2017 9:33 pm

Sorry for the news.

Oh golly. Only on Bogleheads would a single person with close to $2.7M be told that's not enough to retire.

I'd sell the two properties, move to a lower cost of living area and rent. Consult when you want. Enjoy life.

Yes you might owe some tax on the sale of the rental so perhaps a little less than $2.7M.

User avatar
ram
Posts: 892
Joined: Tue Jan 01, 2008 10:47 pm
Location: Midwest

Re: Third time in my 32 year career I have been laid off

Post by ram » Fri Oct 06, 2017 9:41 pm

Let's consider the worst case scenario.

Your income was 125 K. To amass the net worth that you have, let's assume you were saving 20% (25K). That leaves 100K. Assuming you retire as of today you should be saving about 20K in taxes based on retirement income as compared to current income.
In other words 80K /yr should be adequate to maintain your current lifestyle.

Based on 4% withdrawal from your investable assets you have 64K. Add 16 K for net rent. ( 14 K for maintenance of rental property) and you are upto 80K.

Your substantial assets in taxable will mean a lower rate of tax. ( Look for zero taxes thread by livesoft)

This does not include the fact that sometime after 62 you will get SS money and the fact that you can sell off your real estate assets sometime in the future and that will be another 10 to 15 years worth of expenses.

In fact to me it looks like you can potentially increase your current standard of living without any additional salary income.

You can continue the current health insurance for about 18 months by paying the same rate of premium. ( you pay both your portion and the employer portion). ( COBRA)

Others will soon chime in with better info.
Ram

User avatar
FIREchief
Posts: 1415
Joined: Fri Aug 19, 2016 6:40 pm

Re: Third time in my 32 year career I have been laid off

Post by FIREchief » Fri Oct 06, 2017 9:56 pm

That sucks. Sorry to hear about your layoff. I was only there once, but close many other times.

OTOH: It's great that you're a Boglehead and not one paycheck away from the street. You likely have numerous options. Best wishes!! :sharebeer
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

Curlyq
Posts: 788
Joined: Tue Jul 08, 2008 5:26 pm

Re: Third time in my 32 year career I have been laid off

Post by Curlyq » Fri Oct 06, 2017 9:56 pm

stan1 wrote:
Fri Oct 06, 2017 9:33 pm
Oh golly. Only on Bogleheads would a single person with close to $2.7M be told that's not enough to retire.

I'd sell the two properties, move to a lower cost of living area and rent. Consult when you want. Enjoy life.
+1

I was laid off in April. I was already only working part-time, so decided to become a goof-off. Few years older, similar assets as poster, somewhat lower cost of living area. So far, rental income and ~1.5% withdrawal from portfolio has been more than enough to live well. Good luck with your decision.

DVMResident
Posts: 1117
Joined: Mon Aug 01, 2011 8:15 pm

Re: Third time in my 32 year career I have been laid off

Post by DVMResident » Fri Oct 06, 2017 9:59 pm

Sorry. That's really rough.
FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.
^ What do your expenses look like?
How does a $60k plus rental income lifestyle appeal to you? It's very doable and not that far off your current net income (125 minus taxes and retirement savings). This is especially true true if you supplement with a little of consulting work (listen to the Michael Kitces 4% rule podcast on Madfientist).

On the rental comments, I think it's fine for the 40% of NW to be in RE. However, the rent:market value isn't very good. About 4.7% gross returns on market price excluding market swings (which goes both ways, especially in CA). The ROI doesn't really justify a concentrated asset. If you're income goes to zero next year, it maybe a good year to sell: hot market and low brackets. Another option is sell your current place for the primary home exclusion and move into the rental (very personal choice, but the taxes favor it).

The real trick is the health care. As other's have mentioned, COBRA and ACA are an option. You try to milk health care out of the employer for the consulting work (long shot, but not impossible depending on the arrangement).
FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.
^ You really, really don't need to make the same salary. You've just about saved enough to live for life and plus two paid off homes.
Last edited by DVMResident on Fri Oct 06, 2017 11:31 pm, edited 1 time in total.

WanderingDoc
Posts: 347
Joined: Sat Aug 05, 2017 8:21 pm

Re: Third time in my 32 year career I have been laid off

Post by WanderingDoc » Fri Oct 06, 2017 10:29 pm

FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
I heard about some company issues last week. I got called into the boss' office and he mentioned there is no revenue in the pipeline for the next year. Effective today I am laid off. My employer mentioned he wants to soften the transition by offering me a part-time consultant position and we'll talk soon.



Emergency funds: 3 months of expenses
Debt: 0 debt. No house loan, No car loan, No credit cards balance
Tax Filing Status: Single
State of Residence: CA
Age: 55
Income: 0. Was making 125,000 earlier today. Software Developer career.

Desired Asset allocation: 60% stocks / 40% bonds
Desired International allocation: 15% of stocks

Current retirement assets
Size of the portfolio: 1.6 million not including real estate

Breakdown within each asset class:
Total Bond Market 600,000 in tax deferred
Total Stock Market 850,000 in taxable
Total International Stock Market 150,000 in taxable

Primary Home: 538,000 No loans
Rental Home: 633,760 No loans. 2,500 month rent


Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.

2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.

3. Medical insurance for the recently unemployed? An ideas?

4. Should I file for unemployment today? Should I wait for Monday's meeting?

I would suggest you start to purchase income-producing real estate. Do you have any rentals currently?

The reason is precisely for times like these. If you bought just 1 property every 2-3 years, you would have had several properties by now, many of which have appreciated, all of which have a lot of the principal paydown taken care of you by tenants along the way. You would easily have had $3-10K of net monthly income from real estate. No worrying about whether you should (or could) pull out retirement mutual funds without paying penalties or taxes.

I have only been investing in real estate since late 2013.. and it generates >$3.5K of net monthly income for me (accounting for vacancies, repairs, and CapEx). I didn't even intend for this to happen

I don't have a problem with mutual funds per se and will start to include them for a minority of my portfolio. As I see it, I won't get money in my mailbox NOW with paper investing in a retirement or taxable account. It looks like you have worked hard, saved, and invested diligently, so I commend you for that. I would recommend more INCOME-produce assets that pay you every month and aren't 'stuck' anywhere. Flexibility is never a bad thing and I have never heard of anyone that said "I'd prefer less flexible investments, lifestyle, partner, etc."

Edit 1: I just saw that you own Bay Area real estate. Congrats, you are on the right path and kicking butt.
Edit 2: Yes, only on BH.org is investing in one of the most profitable and desirable market in the U.S. "risky" and "not diversified enough".
One day it suddenly dawned on me that I had won the real estate lottery. | I'm not looking to get rich quickly. I'm not looking to get rich slowly. I'm looking to get rich for sure.

WanderingDoc
Posts: 347
Joined: Sat Aug 05, 2017 8:21 pm

Re: Third time in my 32 year career I have been laid off

Post by WanderingDoc » Fri Oct 06, 2017 10:36 pm

Curlyq wrote:
Fri Oct 06, 2017 9:56 pm
stan1 wrote:
Fri Oct 06, 2017 9:33 pm
Oh golly. Only on Bogleheads would a single person with close to $2.7M be told that's not enough to retire.

I'd sell the two properties, move to a lower cost of living area and rent. Consult when you want. Enjoy life.
+1

I was laid off in April. I was already only working part-time, so decided to become a goof-off. Few years older, similar assets as poster, somewhat lower cost of living area. So far, rental income and ~1.5% withdrawal from portfolio has been more than enough to live well. Good luck with your decision.
Bingo. 8-)
One day it suddenly dawned on me that I had won the real estate lottery. | I'm not looking to get rich quickly. I'm not looking to get rich slowly. I'm looking to get rich for sure.

KlangFool
Posts: 7196
Joined: Sat Oct 11, 2008 12:35 pm

Re: Third time in my 32 year career I have been laid off

Post by KlangFool » Fri Oct 06, 2017 10:39 pm

OP,

You are in great shape financially. You do not need to work. So, stop settling for less. Somebody will have to pay you a lot more than 120K for you to work full-time. If your current employer offers you a part-time, do not settle for less than what you get for a full-time position. In fact, you should ask for a lot more.

At your current net worth, your 40 hours per week is worth a lot more than 120K per year.

KlangFool

User avatar
Watty
Posts: 11792
Joined: Wed Oct 10, 2007 3:55 pm

Re: Third time in my 32 year career I have been laid off

Post by Watty » Fri Oct 06, 2017 10:53 pm

stan1 wrote:
Fri Oct 06, 2017 9:33 pm
Sorry for the news.

Oh golly. Only on Bogleheads would a single person with close to $2.7M be told that's not enough to retire.

I'd sell the two properties, move to a lower cost of living area and rent. Consult when you want. Enjoy life.

Yes you might owe some tax on the sale of the rental so perhaps a little less than $2.7M.
+1

and the OP will get Social Security at some point.

The biggest issue I see is that they have over a million dollars in California real estate and that is nearly half of their net worth.

FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
Rental Home: 633,760 No loans. 2,500 month rent
I don't really know how to properly analyze real estate but that is bringing in $30K a year which is less that a 5% return before you pay property taxes, maintenance, and all the other costs that go with owning a rental. I would take a hard look at if keeping the rental really makes sense. If taxes are an issue you can likely do a 1031 real estate exchange for something with better numbers. Even if you get another job quickly I would consider getting rid of that house.
Last edited by Watty on Fri Oct 06, 2017 10:56 pm, edited 1 time in total.

User avatar
tooluser
Posts: 188
Joined: Sat Oct 01, 2011 7:04 pm

Re: Third time in my 32 year career I have been laid off

Post by tooluser » Fri Oct 06, 2017 10:55 pm

Condolences, I feel a little better now, maybe. :? (See Pension Freeze thread.)
If I were in your position I would seek a little more for assets or income. Not a whole lot though. Very tempting.
Plan B - retire at a more modest lifestyle. Freedom isn't free.
Learn economical motion of delivery from a variety of angles, then lengthen the distance gradually. -- Bruce Lee

User avatar
unclescrooge
Posts: 1628
Joined: Thu Jun 07, 2012 7:00 pm

Re: Third time in my 32 year career I have been laid off

Post by unclescrooge » Sat Oct 07, 2017 12:02 am

You could rent out your home. Coupled with the the money you're getting from you're other rental, you could live lavishly in Thailand until medicare kicks in.

Healthcare in Thailand is on par with the U.S. But at a fraction of the cost.

JBTX
Posts: 1695
Joined: Wed Jul 26, 2017 12:46 pm

Re: Third time in my 32 year career I have been laid off

Post by JBTX » Sat Oct 07, 2017 1:38 am

FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
I heard about some company issues last week. I got called into the boss' office and he mentioned there is no revenue in the pipeline for the next year. Effective today I am laid off. My employer mentioned he wants to soften the transition by offering me a part-time consultant position and we'll talk soon.
Sorry to hear that. I am basically your age, and have been laid off 3 times too. I'm trying to figure out what to do next. Good news is my wife works and has good income, but we have 2 kids to feed also.
Emergency funds: 3 months of expenses
Debt: 0 debt. No house loan, No car loan, No credit cards balance
Tax Filing Status: Single
State of Residence: CA
Age: 55
Income: 0. Was making 125,000 earlier today. Software Developer career.

Desired Asset allocation: 60% stocks / 40% bonds
Desired International allocation: 15% of stocks

Current retirement assets
Size of the portfolio: 1.6 million not including real estate

Breakdown within each asset class:
Total Bond Market 600,000 in tax deferred
Total Stock Market 850,000 in taxable
Total International Stock Market 150,000 in taxable

Primary Home: 538,000 No loans
Rental Home: 633,760 No loans. 2,500 month rent


Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.
You probably could. 4% of $1.6 million - $64K, plus rental income. Then in 10-15 years social security kicks in. Should you? Only you can figure that out. Give yourself some time to sort it all out. The good news is you don't have to rush.
2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.
I'm finally resigning myself that if and when I end up back at work, it will be for significantly less. I'd listen to what they have to say about the consulting gig. I've worked 1099 off an on for years. There are some benefits to it, provided you take care of the medical insurance. Flexible hours, don't have to put up with employee BS, etc.

Get past any residual sting of being laid off. It is business. It happens. In some ways i was kind of relieved, because the job had become repetitive and monotonous. You've just been unburdened from all of those worrisome details that were grinding away at you every day.
3. Medical insurance for the recently unemployed? An ideas?
You will be offered COBRA, which is essentially your employer's insurance but you pay the whole ball of wax. Likely expensive, but still may be worth it. You will have a couple of months to elect taking it or not, so you have plenty of time. Or else look for private policy. Good news is with ACA you can't be denied coverage. I paid for my cobra for 18 months until it ran out, in spite of it being expensive.
4. Should I file for unemployment today? Should I wait for Monday's meeting?
Did you get a severance? Depending on how it is structured, and if you signed an agreement, you may or may not be able to get unemployment while on severance. I'd make sure to understand its terms, and understand its impacts on unemployment before filing. I filed right after getting laid off, got a nominal severance, and they (unemployment agency) told me i wasn't eligible until severance was done - which i don't think was correct, I probably gave them incorrect info regarding the structure of the severance agreement. Ultimately it didn't matter as I was 1099 working for a friend's company the next week (which ended up lasting 4 years)

PS: I agree with others on your rental home. If you had financed your rental home at 80% mortgage, at 4-5%, you'd essentially be breaking even cash flow wise. You may be better off either selling it, or moving into it and selling your primary home, or sell both!!

User avatar
LiveSimple
Posts: 894
Joined: Thu Jan 03, 2013 7:55 am

Re: Third time in my 32 year career I have been laid off

Post by LiveSimple » Sat Oct 07, 2017 2:28 am

If you are on the technical development side, learn an emerging technology and can consult for more compensation. Cloud enablement or data science will pay you well. If you are in Silicon Valley, you know the lay of the land, so can get another job.

However as many have said, you can retire in a low cost area such as Thailand, or many parts of U.S. today.

Best may be retire to a low cost area and still consult working remotely, you have 32 years experience, you have to do some soul screarching and project your marketable skills, within.

You have it, only you have to believe in you and discuss with someone, who can mentor or coach you, to bring the best in you. Maybe your consulting within your conpany will work as well, but do not sell yourself low.

Good luck.

mouses
Posts: 2449
Joined: Sat Oct 24, 2015 12:24 am

Re: Third time in my 32 year career I have been laid off

Post by mouses » Sat Oct 07, 2017 2:44 am

JBTX wrote:
Sat Oct 07, 2017 1:38 am
4. Should I file for unemployment today? Should I wait for Monday's meeting?
Did you get a severance? Depending on how it is structured, and if you signed an agreement, you may or may not be able to get unemployment while on severance. I'd make sure to understand its terms, and understand its impacts on unemployment before filing. I filed right after getting laid off, got a nominal severance, and they (unemployment agency) told me i wasn't eligible until severance was done - which i don't think was correct, I probably gave them incorrect info regarding the structure of the severance agreement.
Whenever you're laid off, file for unemployment immediately.

I was laid off several times in California. Although I received severance and signed paperwork of various sorts, I was also eligible for unemployment. If someone says you are not, push back.

Do not buy more real estate.

Be cleareyed about the consulting offer. (And unemployment payments may continue if you are underemployed.) Maybe your boss is providing a cushion, but maybe he needs your skills. I have a friend who (unique in my experience) makes more money consulting for the employer who laid her off than she did when she was a full time employee, even taking into account the higher insurance etc, costs.

User avatar
Tamarind
Posts: 669
Joined: Mon Nov 02, 2015 2:38 pm

Re: Third time in my 32 year career I have been laid off

Post by Tamarind » Sat Oct 07, 2017 6:17 am

I think you have enough to retire or semi-retire if you want, provided that $60k annually will actually cover all your expenses. Take careful stock of that, including taxes, health insurance, and lumpy costs. Your SS will take a hit, but it looks like that's just icing with the savings you have amassed.

Assuming that your expenses really are $60k, then you just have to decide what real estate you want to keep.

If the rental nets less than $2100 monthly, you should sell it, because you can generate that much from the invested proceeds without the work/risk. Or you could keep it and make your work turning it into a more profitable rental.

Or if you want to work a while longer, remember that you don't have to find a gig that replaces your whole salary. You only need to make $60k (minus your net from the rental if you keep it), which is surely doable. This could be a good way to wind down from working or seek better working conditions while remaining engaged in your profession.

Dandy
Posts: 4816
Joined: Sun Apr 25, 2010 7:42 pm

Re: Third time in my 32 year career I have been laid off

Post by Dandy » Sat Oct 07, 2017 6:33 am

Sorry to hear of your unemployment.
1. While you have a decent amount of assets remember equities are at an historic high. That won't last forever and you might be looking at a "correction" in your early retirement stage. I would change your taxable distributions to cash now. It would be great to adjust your allocation but that may cause unwanted tax issues.
2. I would definitely look for continued employment even part time especially until you adjust to your new situation.
3. Health insurance is a big issue you need to determine if your employer's offer of part time work would include health insurance. If not, sign up for the Affordable Care Act.
4. Look at "unnecessary" expenses and try to reduce/eliminate them. At least target which ones will go if things don't go your way.e.g. premium channels, subscriptions, lawn service, etc.
5. Keep social and business contacts alive for sanity and network opportunities. Get the word out that you are looking and looking for leads.

Best of luck

ksleo
Posts: 17
Joined: Wed Jan 18, 2017 11:47 am

Re: Third time in my 32 year career I have been laid off

Post by ksleo » Sat Oct 07, 2017 9:20 am

As far as considering potential retirement, I would offer this: In many other threads wiser Bogleheads have said you should retire TO something, not FROM something. It sounds like you have nothing to retire to at the moment, so I don't think retirement would be the best course of action. However, your substantial assets means that you do not need to rush to another job. Relax, you have time to consider all of your options and wait for the best opportunity rather than the first opportunity.
Actions have consequences.

User avatar
reriodan
Posts: 393
Joined: Fri Feb 12, 2016 10:08 am

Re: Third time in my 32 year career I have been laid off

Post by reriodan » Sat Oct 07, 2017 9:31 am

I would have retired 5 years if I were you.

Txsman
Posts: 14
Joined: Fri Sep 30, 2016 12:56 pm

Re: Third time in my 32 year career I have been laid off

Post by Txsman » Sat Oct 07, 2017 9:45 am

I was laid off at 60. Same financial situation as yours. I am consulting now, my own hours, my own terms. I wish I would have done it years ago, Try consulting if you aren't ready to retire. Good luck.

2015
Posts: 973
Joined: Mon Feb 10, 2014 2:32 pm

Re: Third time in my 32 year career I have been laid off

Post by 2015 » Sat Oct 07, 2017 9:49 am

reriodan wrote:
Sat Oct 07, 2017 9:31 am
I would have retired 5 years if I were you.
+100
I just got back from an oceanfront suite vacation in Mexico, where I stared out the window at a panorama of ever-changing ocean and sky, a most delicious cup of morning Mexican coffee in hand, thinking how lucky I was to: a) have retired 2 1/2 years ago at 60; and b) have had my plans to work part-time fail to materialize.

Compared to the freedom found in retirement, working really, really sucks, IMO. I say retire now and start living life.

snowman
Posts: 605
Joined: Thu Jan 31, 2013 12:59 pm

Re: Third time in my 32 year career I have been laid off

Post by snowman » Sat Oct 07, 2017 9:59 am

I think your boss did you a huge favor. You could have been retired for years already.

I would file for unemployment, and start enjoying life.

JW-Retired
Posts: 6533
Joined: Sun Dec 16, 2007 12:25 pm

Re: Third time in my 32 year career I have been laid off

Post by JW-Retired » Sat Oct 07, 2017 9:59 am

FelixTheCat wrote: Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.
JBTX wrote:You probably could. 4% of $1.6 million - $64K, plus rental income. Then in 10-15 years social security kicks in. Should you? Only you can figure that out. Give yourself some time to sort it all out. The good news is you don't have to rush.
Question FelixTheCat: In the obvious typo above, did you mean $60,000 per year, or is it you meant $6000 per month? Everyone seems to be assuming it's the per year? Are they right?
JW
Retired at Last

User avatar
randomizer
Posts: 714
Joined: Sun Jul 06, 2014 3:46 pm

Re: Third time in my 32 year career I have been laid off

Post by randomizer » Sat Oct 07, 2017 10:18 am

I feel like you're my future self writing to me back through time, except when I get laid off I won't we have as many assets as you. I think you're going to be all right!

goingup
Posts: 2833
Joined: Tue Jan 26, 2010 1:02 pm

Re: Third time in my 32 year career I have been laid off

Post by goingup » Sat Oct 07, 2017 10:26 am

You are in fantastic shape to retire, if you choose. You have 2 paid off homes and a passive income stream of about $50K per year from dividends and rents. Work part-time if you like. It would be especially helpful to have a job that provided health care though that may be tough to find. :beer

User avatar
nedsaid
Posts: 8821
Joined: Fri Nov 23, 2012 12:33 pm

Re: Third time in my 32 year career I have been laid off

Post by nedsaid » Sat Oct 07, 2017 11:48 am

Felix the cat, I am in between jobs right now and have been attending a weekly job club. Fortunately, the high tech type of stuff seems to be in hot demand right now. The people from the tech industry tend to attend one, two, or three weeks and then I don't see them again. Presumably they have found jobs. Assuming your skills are up to date, you should not have too much trouble finding a new job. It may not be at your former pay level but I am pretty confident you will find something. This might also be an opportunity for you to downshift, maybe you don't want to hit it as hard in the workplace anymore. The part-time gig might be just the ticket.

This is a classic case of why I recommend that people make it a goal to have one year of living expenses saved up in emergency funds by the age of 50. Sad to say, when you get past 50 you have a target on your back whenever layoffs are being considered.
A fool and his money are good for business.

DrGoogle2017
Posts: 668
Joined: Mon Aug 14, 2017 12:31 pm

Re: Third time in my 32 year career I have been laid off

Post by DrGoogle2017 » Sat Oct 07, 2017 11:56 am

I’ve been laid off 3 times in my 35 years as an engineer. It’s not uncommon. Worst yet,it always happened during a recession where everybody’s out of work. Take your time and enjoy your time off. You’ll find work again if you want to work, otherwise you are in good shape. Nothing to worry about.

User avatar
Sandtrap
Posts: 2758
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳

Re: Third time in my 32 year career I have been laid off

Post by Sandtrap » Sat Oct 07, 2017 11:59 am

nedsaid wrote:
Sat Oct 07, 2017 11:48 am
Felix the cat, I am in between jobs right now and have been attending a weekly job club. Fortunately, the high tech type of stuff seems to be in hot demand right now. The people from the tech industry tend to attend one, two, or three weeks and then I don't see them again. Presumably they have found jobs. Assuming your skills are up to date, you should not have too much trouble finding a new job. It may not be at your former pay level but I am pretty confident you will find something. This might also be an opportunity for you to downshift, maybe you don't want to hit it as hard in the workplace anymore. The part-time gig might be just the ticket.

This is a classic case of why I recommend that people make it a goal to have one year of living expenses saved up in emergency funds by the age of 50. Sad to say, when you get past 50 you have a target on your back whenever layoffs are being considered.
+1
And at 65 plus, depending on the skill set, model and mileage, one might be completely phased out of the game. :(

delamer
Posts: 3235
Joined: Tue Feb 08, 2011 6:13 pm

Re: Third time in my 32 year career I have been laid offk

Post by delamer » Sat Oct 07, 2017 12:06 pm

You didn't provide any information on how your expenses compare to the $60,000 income. And is it $60,000 per year or $6,000 per month (presumably $60,000 per month is not correct)?

Assuming $60,000 per year, a lot of people live comfortably on that but all that matters is your personal expenses. So if you have not been tracking expenses, you should look over your credit card and bank statements to figure them out.

Health insurance is a big issue, and COBRA is probably your best option in the short run. You also should investigate the healthcare exchange in your state.

The retirement issue doesn't really have to be a binary yes/no. You could decide that you can live on your savings, and stop looking for work of course. Or you can look for work at your old earnings level, but figure out how to live off your savings if you can't find work. Or you can decide to do consulting like your former employer is offering, and supplement your consulting fees with your savings to cover your expenses as needed.

Best of luck.

TIAX
Posts: 860
Joined: Sat Jan 11, 2014 12:19 pm

Re: Third time in my 32 year career I have been laid off

Post by TIAX » Sat Oct 07, 2017 12:13 pm

FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
Age: 55
Income: 0. Was making 125,000 earlier today. Software Developer career.
Were older (over 40 years old) employees laid off disproportionately? If so, consider meeting with an attorney who specializes in age discrimination claims.

TravelforFun
Posts: 898
Joined: Tue Dec 04, 2012 11:05 pm

Re: Third time in my 32 year career I have been laid off

Post by TravelforFun » Sat Oct 07, 2017 12:23 pm

2015 wrote:
Sat Oct 07, 2017 9:49 am
reriodan wrote:
Sat Oct 07, 2017 9:31 am
I would have retired 5 years if I were you.
+100
I just got back from an oceanfront suite vacation in Mexico, where I stared out the window at a panorama of ever-changing ocean and sky, a most delicious cup of morning Mexican coffee in hand, thinking how lucky I was to: a) have retired 2 1/2 years ago at 60; and b) have had my plans to work part-time fail to materialize.

Compared to the freedom found in retirement, working really, really sucks, IMO. I say retire now and start living life.
Felix, quit the rat race. You have enough to last the rest your life without having to worry about getting a job and getting laid off again.

It's time to restore your soul.

User avatar
FelixTheCat
Posts: 1476
Joined: Sat Sep 24, 2011 12:39 am

Re: Third time in my 32 year career I have been laid off

Post by FelixTheCat » Sat Oct 07, 2017 1:07 pm

JW-Retired wrote:
Sat Oct 07, 2017 9:59 am
Question FelixTheCat: In the obvious typo above, did you mean $60,000 per year, or is it you meant $6000 per month? Everyone seems to be assuming it's the per year? Are they right?
Ooops. It is 60K a year.
Last edited by FelixTheCat on Sat Oct 07, 2017 1:15 pm, edited 1 time in total.
Felix is a wonderful, wonderful cat.

JBTX
Posts: 1695
Joined: Wed Jul 26, 2017 12:46 pm

Re: Third time in my 32 year career I have been laid off

Post by JBTX » Sat Oct 07, 2017 1:15 pm

FelixTheCat wrote:
Sat Oct 07, 2017 1:07 pm
JW-Retired wrote:
Sat Oct 07, 2017 9:59 am
FelixTheCat wrote: Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? I have not even considered retirement yet. I am thinking 62.
JBTX wrote:You probably could. 4% of $1.6 million - $64K, plus rental income. Then in 10-15 years social security kicks in. Should you? Only you can figure that out. Give yourself some time to sort it all out. The good news is you don't have to rush.
Question FelixTheCat: In the obvious typo above, did you mean $60,000 per year, or is it you meant $6000 per month? Everyone seems to be assuming it's the per year? Are they right?
JW
Ooops. It is 60K a year.
If it were 60k per month then I doubt we are having this conversation!

As stated by others you are in great financial shape and can do what you want to do. Sometimes figuring that out isn't easy though.

User avatar
FelixTheCat
Posts: 1476
Joined: Sat Sep 24, 2011 12:39 am

Re: Third time in my 32 year career I have been laid off

Post by FelixTheCat » Sat Oct 07, 2017 1:43 pm

Watty wrote:
Fri Oct 06, 2017 10:53 pm
I don't really know how to properly analyze real estate but that is bringing in $30K a year which is less that a 5% return before you pay property taxes, maintenance, and all the other costs that go with owning a rental. I would take a hard look at if keeping the rental really makes sense. If taxes are an issue you can likely do a 1031 real estate exchange for something with better numbers. Even if you get another job quickly I would consider getting rid of that house.
I was wondering what to do with the rental. I get these Zillow reports saying "It's a good time to be a seller." which started me thinking. I'll have to wait a year because I just rented the place.

The property always rents quickly. The property value is projected to increase 3.6% for the next year. The rent is 4.7% return before I pay expenses.

I talked to a church buddy who is a real estate agent. His philosophy was simple "Keep it if it is making a positive cash-flow." I like it because it brings monthly income.
Felix is a wonderful, wonderful cat.

staythecourse
Posts: 5069
Joined: Mon Jan 03, 2011 9:40 am

Re: Third time in my 32 year career I have been laid off

Post by staythecourse » Sat Oct 07, 2017 2:15 pm

FelixTheCat wrote:
Fri Oct 06, 2017 9:21 pm
student wrote:
Fri Oct 06, 2017 9:15 pm
I am sorry to hear that. I think you should be ok with your assets. I would be nervous having about 40% of net worth in two houses though.
I live in CA. Housing keeps going up. My rental just increased rent by 400 a month. Should I be concerned?
Are you interested in only living in CA? If I was in your situation I would do the part time consultation job while I put my primary house on the market. Sell it and move to a LCOL area. That will free up more money, lower your COLA going forward until SS, and allow you to retire now. The bigger question is that what YOU want. Life is not always about logic. Hard to say go retire now even if he numbers work if you have no interest in it.

BTW, great work saving so much on a single income.

Good luck.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

CnC
Posts: 268
Joined: Thu May 11, 2017 12:41 pm

Re: Third time in my 32 year career I have been laid off

Post by CnC » Sat Oct 07, 2017 4:52 pm

Sandtrap wrote:
Fri Oct 06, 2017 9:23 pm
Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? Not yet. I have not even considered retirement yet. I am thinking 62.Yes. . or later. 65 is medicare, etc.

2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.Looking for a job right away preserves your income stream. Secondary is making an equal or better salary. Not having to tap into your reserves is important.

3. Medical insurance for the recently unemployed? An ideas? COBRA, and other policies will cover the gap until the next employment hopefully. Research this. If not then you will have to apply for ACA in your region.

4. Should I file for unemployment today? Yes. It takes time for the payments to kick in. Again, preserve your income stream. Should I wait for Monday's meeting?
Sorry to hear about your dilemma. Good luck. It will get better.
I never understood the the complete 0 value some people place on retirement at a young enough age to enjoy it.

The guy has nearly 3 million and is 7 years away from possible social security he has no wife or children to support.



I say draw unemployment for as long as you can then do some contract work in spare time.

pinhead
Posts: 113
Joined: Fri Apr 04, 2014 8:47 pm

Re: Third time in my 32 year career I have been laid off

Post by pinhead » Sat Oct 07, 2017 4:58 pm

You know what's funny? You might make more being part time as a consultant to the same company. Strange, but thats how it works.

KyleAAA
Posts: 6371
Joined: Wed Jul 01, 2009 5:35 pm
Contact:

Re: Third time in my 32 year career I have been laid off

Post by KyleAAA » Sat Oct 07, 2017 5:37 pm

In your shoes I would retire and take part-time contract work to keep busy and pad the retirement account little. If you aren't tied to staying in California you could lead a very nice lifestyle somewhere cheaper. You appear to have plenty.

User avatar
Sandtrap
Posts: 2758
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳

Re: Third time in my 32 year career I have been laid off

Post by Sandtrap » Sat Oct 07, 2017 5:40 pm

CnC wrote:
Sat Oct 07, 2017 4:52 pm
Sandtrap wrote:
Fri Oct 06, 2017 9:23 pm
Questions:
1. Firecalc says I can retire on 60,000 a month for 30 years. Should I? Not yet. I have not even considered retirement yet. I am thinking 62.Yes. . or later. 65 is medicare, etc.

2. Are there any suggestions on what I should do besides the usual beef up my resume, look for a job? I'm 55 and I figure it will be difficult finding a job that makes my salary.Looking for a job right away preserves your income stream. Secondary is making an equal or better salary. Not having to tap into your reserves is important.

3. Medical insurance for the recently unemployed? An ideas? COBRA, and other policies will cover the gap until the next employment hopefully. Research this. If not then you will have to apply for ACA in your region.

4. Should I file for unemployment today? Yes. It takes time for the payments to kick in. Again, preserve your income stream. Should I wait for Monday's meeting?
Sorry to hear about your dilemma. Good luck. It will get better.
I never understood the the complete 0 value some people place on retirement at a young enough age to enjoy it.

The guy has nearly 3 million and is 7 years away from possible social security he has no wife or children to support.

I say draw unemployment for as long as you can then do some contract work in spare time.
Yes.
That is also a good option amongst so many options depending on one's situation and unique comfort zone. :D

User avatar
Watty
Posts: 11792
Joined: Wed Oct 10, 2007 3:55 pm

Re: Third time in my 32 year career I have been laid off

Post by Watty » Sat Oct 07, 2017 8:14 pm

FelixTheCat wrote:
Sat Oct 07, 2017 1:43 pm
Watty wrote:
Fri Oct 06, 2017 10:53 pm
I don't really know how to properly analyze real estate but that is bringing in $30K a year which is less that a 5% return before you pay property taxes, maintenance, and all the other costs that go with owning a rental. I would take a hard look at if keeping the rental really makes sense. If taxes are an issue you can likely do a 1031 real estate exchange for something with better numbers. Even if you get another job quickly I would consider getting rid of that house.
I was wondering what to do with the rental. I get these Zillow reports saying "It's a good time to be a seller." which started me thinking. I'll have to wait a year because I just rented the place.

The property always rents quickly. The property value is projected to increase 3.6% for the next year. The rent is 4.7% return before I pay expenses.

I talked to a church buddy who is a real estate agent. His philosophy was simple "Keep it if it is making a positive cash-flow." I like it because it brings monthly income.
You might start a new thread where you give the details and ask if it is a good rental property. That might get the attention of people that know more about real estate.

User avatar
Sandtrap
Posts: 2758
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii😀 Northern AZ.😳

Re: Third time in my 32 year career I have been laid off

Post by Sandtrap » Sat Oct 07, 2017 9:32 pm

Watty wrote:
Sat Oct 07, 2017 8:14 pm
FelixTheCat wrote:
Sat Oct 07, 2017 1:43 pm
Watty wrote:
Fri Oct 06, 2017 10:53 pm
I don't really know how to properly analyze real estate but that is bringing in $30K a year which is less that a 5% return before you pay property taxes, maintenance, and all the other costs that go with owning a rental. I would take a hard look at if keeping the rental really makes sense. If taxes are an issue you can likely do a 1031 real estate exchange for something with better numbers. Even if you get another job quickly I would consider getting rid of that house.
I was wondering what to do with the rental. I get these Zillow reports saying "It's a good time to be a seller." which started me thinking. I'll have to wait a year because I just rented the place.

The property always rents quickly. The property value is projected to increase 3.6% for the next year. The rent is 4.7% return before I pay expenses.

I talked to a church buddy who is a real estate agent. His philosophy was simple "Keep it if it is making a positive cash-flow." I like it because it brings monthly income.
You might start a new thread where you give the details and ask if it is a good rental property. That might get the attention of people that know more about real estate.
OP:

Depending on the landlord-tenant code in your area and your lease, you are most likely not at all bound by a tenant lease as far as when and whether or not to sell your property. In 40+ years of R/E development I have yet to see this as a restriction. . . but areas differ.

Your "church buddy who is a real estate agent" may not be entirely or even fractionally correct. It's not that simple.
You could be maximizing your returns with less or equal risk elsewhere.

Projected increase property value by "who"? Realtors? Zillow? A real estate agent?

3.6 average annual appreciation is marginal.

4.7% gross CAP before expenses is not much at all.

More importantly, what is your NET CAP rate?

j

bhough
Posts: 46
Joined: Wed Feb 15, 2017 6:53 pm

Re: Third time in my 32 year career I have been laid off

Post by bhough » Sat Oct 07, 2017 9:58 pm

OP,

Nice job on your financial prudence and preparation. NIce job on paying off both mortgages. I'm sorry you were laid off. Please remember it isn't personal.

I'd sell the rental. Assuming you pay something on for property tax and insurance on the rental, your return on that money is not good. I'd sell when that renter leaves.

You have the luxury of retiring if you want, or pursuing a different job in the same career, or pursuing another career. 55 is probably a little too early to start golfing/fishing/puttering full time.

Congrats,
b

User avatar
joe8d
Posts: 4248
Joined: Tue Feb 20, 2007 8:27 pm
Location: Buffalo,NY

Re: Third time in my 32 year career I have been laid off

Post by joe8d » Sat Oct 07, 2017 10:03 pm

My employer mentioned he wants to soften the transition by offering me a part-time consultant position and we'll talk soon.
Sounds like they still need you, but can get you on the cheap that way.
All the Best, | Joe

User avatar
FIREchief
Posts: 1415
Joined: Fri Aug 19, 2016 6:40 pm

Re: Third time in my 32 year career I have been laid off

Post by FIREchief » Sun Oct 08, 2017 12:41 am

FelixTheCat wrote:
Fri Oct 06, 2017 9:09 pm
My employer mentioned he wants to soften the transition by offering me a part-time consultant position and we'll talk soon.
Sounds like a Megacorp scheme to avoid increases in their UI premiums while still sucking more of your brain out at a cheaper price. Never trust Megacorp for anything beyond the (required by law) paycheck; especially when you are told something suggesting that they are concerned for you (such as "wants to soften the 'transition'"). "Transition." Is that what we are calling being fired (involuntary termination) now? :annoyed

I hate Megacorp (except of course the paychecks :beer )
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

ClaycordJCA
Posts: 165
Joined: Sun Aug 09, 2015 11:19 pm
Location: SF Bay Area

Re: Third time in my 32 year career I have been laid off

Post by ClaycordJCA » Sun Oct 08, 2017 2:21 am

Just a reminder that since you are in California, state law extends COBRA eligibility an additional 18 months to a total of 36 months. I also saw on a State of CA website that at the end of 36 months that the COBRA policy can be converted to an individual policy albeit at higher premiums, but with no preexisting condition exclusion. Cashing out home equity and moving to a lower cost of living area in California for at least the next 6 years is what we are planning to do if I retire next year at age 59.

Post Reply