My Life on Unemployment Budget

Going from $6k a month after tax to $1.8k pre-tax takes some major adjusting in spending habits. Lucky for me I don’t have kids and while my rent is high I don’t have a mortgage or house to worry about losing. My goal while on unemployment (other than to find a job that suits me and that I can succeed in) is to – with the exception of stock market fluctuations – maintain my networth as much as possible. This means no more frivolous trips to Sephora (in fact I’m returning about $100 in items I purchased prior to losing my job) and no more adventures to the outlet mall. Spending now is limited to basic necessities until I find another job and remain employed for a period of over three months for stability insurance.

Current Networth: $284,000 (Goal do not dip below $280k before end of 2014. Save $70k in 2015)

September Budget

Income: $1800 – 35% taxes =  $1170

Rent: $1350
Car Insurance: $104.69
Health Insurance: TBD ($250?)
Food: $200
Bridesmaid (flight, bridal shower split contrib): $500
Phone Bill: $100
Other Bills: $75 (estimate)
======================
$2579 Spend
$284k-$1479 = $282k Sept Networth End

——————————————————————————–

October Budget

Income: $1800 – 35% taxes =  $1170

Rent: $1350
Car Insurance: $104.69
Health Insurance: TBD ($250?)
Food: $200
Bridesmaid (flight, bachlorette party): $1000
Phone Bill: $100
Other Bills: $75 (estimate)
——————————————————–
$3079 Spend
$282k-$1909 = $280k Oct Networth End

——————————————————————————–

November Budget

Income: $1800 – 35% taxes =  $1170

Rent: $1350
Car Insurance: $104.69
Health Insurance: TBD ($250?)
Food: $200
Bridesmaid (flight, hotel, wedding gift): $1000
Phone Bill: $100
Other Bills: $75 (estimate)
——————————————————–
$3079 Spend
$280k-$1909 = $278k Nov Networth End

… and if I don’t have a job by December 1st that pays more than $1800 a month, then things start to get ugly. That said, I’m keeping about $7000 in my liquid bank account right now to tied me over until December. This just isn’t looking good. I wish my rent wasn’t so damn high. It’s my own fault. I talked to my bf about reassessing our split (I pay $1350 and he pays $1000 based on an agreement we had when we signed the lease — which was a fair percentage of our income — but obviously that has changed. I informally ran the idea by him to adjust it back to to a 50/50 split for the time being, but in reality I don’t think it’s fair of me to change what I agreed to and I do have the funds to make up for it while I look for a job. If we’re getting married soon anyway it doesn’t really matter. I know if I continue to pay my agreed on portion of the rent he will feel less bothered by any length of time I spend out of work. Though paying $1175 each would be a big help for now. :/ I think if I don’t have a job by Nov 1 I’ll push on splitting 50/50 for the remainder of our lease, or until I get another job.

The good news is that in December I can return to a reasonable “Frugal” lifestyle (no more bridesmaid duties) which looks more like this…

———————–

November Budget

Income: $1800 – 35% taxes =  $1170

Rent: $1350
Car Insurance: $104.69
Health Insurance: TBD ($250?)
Food: $200
Phone Bill: $100
Other Bills: $75 (estimate)
——————————————————–
$2080 Spend
$278k-$910= $277k Nov Networth End

In other words… if by December I still don’t have a job (eeeks) then I should be able to start spending at an operating loss of $1000 per month, vs over $2000.  But then again if I don’t have a job by then I have other more serious problems on my hands.

 

 

 

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7 comments

  1. Mr. A says:

    You do realize you are spending $500, $1000, then $1000 on being a bridesmaid… seems a little ridiculous to me. I’d maybe pay $500 total and that’s with having positive cash flow. $2500 total, ouch. That would cover more than a month of expenses and clearly bump your net worth up. You do have the net worth to do it, so if it’s that important to you then do it. Also, your friends will understand if you couldn’t make it as you lost your job and are in negative cash flow.

    You will land on your feet this year. I think you already have opportunities, I think you are just trying to decide what to do. I’d strongly advise against getting schooling, because you may find out you don’t want to do that either once you’ve done it. I imagine you have enough education and work history to land a similar job anyways. Until you get to the point where you find the job you want and they clearly tell you that you need xyz education, then get it, and get them to pay for it.

    Hang in there!

    1. Joy ( User Karma: 0 ) says:

      The majority of that is on flights to the east coast — 3 flights, about $400-$500 each. I might be able to find $350 flights but still. The bachlorette party is expensive ($300 per bridesmaid minimum as we are going to NY and getting a hotel plus a night out) and I am chipping in for things such as the bridal shower favors and cards. Then there is the wedding itself where the dress was about $175 not including alterations (though I already paid for that), makeup and hair is $150 (required by bride for all bridesmaids) and then the hotel stay for 2 nights will add up as well. So — if I was really in debt or something I’d either ask to remove myself from the bridal party or pay less somehow but I feel like since I agreed to be her bridesmaid and she ALREADY had bridesmaid drama, having to kick one of her crew out (and there are only 3 bridesmaids) I don’t want to make it worse. One thing I am considering is staying on the east coast at my family home for a month to cut out one flight – which would help a lot – but that also requires telling my folks that I lost my job or very carefully pretending that I’m working from there and not informing them of such. Either way it would be an awkward month. So… that’s that. I’ll write another post explaining exactly how I arrived at my total bridesmaid figures.

      Also in terms of the job that I want I don’t have enough education to switch careers entirely so that’s why I’m seriously considering grad school or at least a training program.

  2. anonymous says:

    Your monthly tax rate of 35% seems too high. California does not tax unemployment benefits. Besides you’ll get another high paying gig soon.

  3. Rob says:

    It looks like your biggest expense is having too many friends that are getting married (or one friend that just can’t make up her mind on finding a guy). 🙂

    But in all seriousness, I understand what it’s like to be in a tight spot. I decided to withdraw from a PhD program that was paying me – to be completely without income. Fortunately, I was able to pick up some freelance writing work until I found a job that fit my current needs and interests.

    I wish you the best of luck and I look forward to seeing how things turn out. As a good measure, I’ll tweet this post to my following – as I know that more readers are always helpful in making some extra cash.

    Again, best of luck and I’ll be cheering!

  4. Anonymous says:

    Best of luck to you in getting to your $2mil goal. I’m in my mid 30s too, make low six figures, and live in SF area, so if you achieve that goal, please share it on your blog. I’d love to find out how to get to that amount before I’m in my late 50s or early 60s so that I can have a less stressful life.

  5. Joy ( User Karma: 0 ) says:

    Only a few very close friends know about this blog. Generally I keep it anonymous. It does worry me that someone will find it that I know, but all things said and done what I write is honest about the issues I have with money and mental health. It could hurt me from getting a job in the future so that would be my only concern.

    I don’t know at what point I’ll stop worrying about “the dollar figure” of my networth. $2M is the number I want to get to in order to be able to retire one day. I believe once I am able to retire I would still work but no longer have to worry about the dollar number. This would enable me to own a basic house and feed myself / live off dividends and investment income with a basic life with some global travel and cultural activities. So if I get to $2,000,000 I will stop fretting.

  6. Anonymous says:

    Does anyone close to you know you maintain a finance blog? If so, what do they think of it? You fret so much about reaching a certain dollar figure on this blog. If you double your networth, do you think you’ll feel the need to double it again and then again after that?

    You’re still young and as long as you have marketable skills, you’ll land on your feet just fine.

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