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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Half Stached on August 05, 2017, 11:27:52 AM

Title: Volunteer for layoff?
Post by: Half Stached on August 05, 2017, 11:27:52 AM
I'm currently looking to RE in April of 2019. Technically, we are on track to hit our FI target in 2020, but my DW wants to work longer, and I don't mind doing some light consulting work occasionally to bridge any gap that comes up. However, it is becoming increasingly likely that my company will have layoffs in early 2018. If I were laid off in 2018, I'd receive my annual bonuses and between 20 and 22 weeks of severance pay. All told, this would amount to about 70% of the total money I expect to make in 2018, and slightly less than 50% what I would expect to make between layoff and my target retirement date. I am considering volunteering for a layoff if appears that they are going to happen. I believe it unlikely that I will be laid off without volunteering. What would you do?

Here are some additional details:

Current savings: 600K + paid off condo
Annual take-home: 250K (approximately 190K from me, 60K from her)
Annual savings rate: 75%
Target FI target savings: 1.3 million + paid off condo
Title: Re: Volunteer for layoff?
Post by: Half Stached on August 05, 2017, 09:38:57 PM
I do believe I can get work fairly easily - either consulting or as an FTE. I certainly agree that if that weren't true, this would be pretty risky.
Title: Re: Volunteer for layoff?
Post by: Villanelle on August 05, 2017, 10:20:08 PM
I would ascertain whether there will be any non-compete type clauses as part of the severance package. Barring that, I would probably volunteer, and then commit to myself to doing as much consulting (or FTE)  as I could at least until I hit the same amount I'd have maid working.  If consulting gigs are ally are that easy to come by, this will likely still lead to an earlier FIRE because you have the severance plus the consultant income. 
Title: Re: Volunteer for layoff?
Post by: Beach_Stache on August 06, 2017, 08:14:23 AM
I would volunteer if you can find another side gig and try to ease into retirement by working part time if you can.  Also keep in mind that for severance, even if you volunteer, you can probably negotiate with them.  If you throw it out there but with a higher figure (say starting with 40 weeks of severance, or a year or something higher) to see what they say.  They may laugh at you and say they will look for others, but you can always settle with their number.  Or you can probably just stick it out for a few more years.  If they have to fire you then they would have to pay unemployment for a while, right?  I would imagine that if they are doing layoffs or trying to get you to volunteer for a package that they won't have any non-competes in there but who knows.  Remember that everything is negotiable though.
Title: Re: Volunteer for layoff?
Post by: Half Stached on August 06, 2017, 01:33:10 PM
Thanks - I hadn't thought about the negotiation angle. I'm not sure how much leverage I'll have here as I believe they will want to lay off other people, but it can't hurt to explore it.

I think it all boils down to the following for me:

 * I'm really ready for a break.
 * We can't afford to give up an extra 6 months worth of savings without having make some other kind of adjustment.

About a decade ago, I took 6 months off from work. There were a bunch of other things going on that prompted that time off, but I found that I went back with a different attitude. Perhaps that is another way to look at the situation: this would provide a break, but I plan for the consulting gigs afterwards rather than just contingency plan for them.