I am one of those people who never learned to save, until now, and fortunately it’s not the result of some disaster like the one you mentioned in this posting.

I’m learning because I’m reading the posts of people like you and seeing how wonderful life can be with the savings. In other words, it’s great to prepare for the worst, but what motivates me more is hearing about the life I can build when I get out of the paycheck-to-paycheck trap.

Keeping my eye on the prize rather than the disaster is far more rewarding for me, and the result will be the same.

A more realistic amount especially in today’s environment is from four to six months financial reserve.

Our expenses were reasonable, so we just held on. BUT, because of all this we have no 401K’s and no pension, so are looking at a very meager retirement, when and if we can really retire. We are both in the mid-fifties. My DH is now at Safeway for 1/4 what he used to make. I run a little antiques shop which is losing money.

So something else to think about, besides being able to hang on til you find another job, is the future, and how a lay off or firing can affect it.

All I can say is, Trent…where were you when I needed you, which would have been when I first started working, 40 years ago. Oh yea, not even born yet. :)

I also agree with the poster that said you just keep getting better and better (at writing). Congrats on the full-time writing too, most writers have to have other jobs, it’s a mercurial profession.

Very cool form of motivation, and i was pleased to find that there’s wasn’t too much stomach clenching going on at the idea. And also that i’m doing most of these things already. Yay me!

Thank you! You have changed my life and my family’s forever.

Keep up the good work.

You raise some good points. We are in a recession and companies are laying people in record numbers. Those pink slips are more a reality than ever before. There is no company loyalty. You can be a dedicated employee for twenty some years and the company will still lay you off to cut costs. I would however, also recommend having a equity line of credit for those who are homeowners.

If the definition implied here is “keep yourself afloat until you find a new job,” that is hardly “independent” in my worldview. The idea of having an emergency fund to avoid running up credit bills is great advice, but even with a fund that would allow you to support your family without debt for 2 years there would still be *significant* impact to your eventual retirement date if you exercised that option. Please clarify the difference between “never work again” and “keep yourself afloat.”

Which leads to another obvious question. Are you making any distinction between funds allocated strictly for retirement and an emergency fund? In the event of an unexpected job loss, retirement funds could be used to carry you thru hard times, but the impact I describe above would be significant. An emergency fund separate from the core retirement fund would avoid this impact, but (in the case of my scenario) would be difficult to accumulate given the competing demands of retirement savings/college savings/mortgage payments/etc. Are you distinguishing an emergency fund from your core retirement portfolio, or is depletion of the emergency fund likely to delay retirement?

When that all went bust, I didn’t get hit as bad as some of my colleagues, I unfortunately didn’t have enough in savings to cover my expenses and ended up in huge debt where I had none before. I just recently paid all that off, and now we’re heading into another economic crash. I learned my lesson from before and am in MUCH better shape. I have low expenses, even though I could afford more, decent amount in savings, and just switched to a higher paying job before any big layoffs happen and I’ll be competing with more workers. The higher amount of income should at the very least allow me to stash a larger amount of reserves. But I’ll never again believe that any company or any job is any more stable than any other, or ‘job security’.