Do you have a backup plan for life?

by Kristina on January 6, 2014 · 3 comments

Good morning Dinks.  Have you ever planned for something and then things didn’t go exactly as planned? My hometown of London, Ontario was recently hit with some devastating news that will affect the lives of more than 600 people and their families.

You may have heard in the news that the cereal giant Kellogg’s is closing one of their Canadian factories.  As you may remember my Dad works for Kellogg’s, or at least he did until he retired five years ago.  This news does not directly affect my family, but it does affect many of the people in my life aka my Dad’s friends who have watched me grow up.  The decision for Kellogg’s to close its doors after more than 30 years in operation at this particular location has mass implications for not only their workers, but also for their pensions and their futures.

Trying to re-enter the workforce in midlife

As with many workplaces Kellogg’s has a very diverse workforce demographic from young to old employees and many of them have spent the majority of their adult life working for Kellogg’s.  Let me ask you this – if you are 50 years old and suddenly find yourself without a job, what do you do? It will most likely be very hard to find another job if you have worked at the same place for most of your life and have a limited skill set because the workplace today is not what it was 20 years ago.  Let me ask you another question – if you are 40 years old and have a mortgage payment with two kids in college and you just lost your job, what do you do? I am only 33 years old and childless, but I am assuming the initial thought has to be sheer and utter panic.

Retirement planning without a pension

There has been no information passed on to employees except that the factory will be completely closed by the end of 2014.  What would you do if your retirement income source was suddenly cut off? Maybe employees will receive a payout package, but the odds of the lump sum amount of money lasting forever is very unlikely.  Not only will newly unemployed workers find themselves without continuous pension savings, they may actually have to dip into their savings in order to survive.  Retirement may no longer be a financial goal for those who don’t know where their next paycheck is coming from.

Planning for the future without a real plan

After the initial shock wears off out-of-work employees have to jump into survival mode in order to keep a roof over their heads and food in their bellies – and those are just the necessities.  What happens to your other monthly debts like credit card and line of credit payments?  When life throws you a money curve ball you have to make a new plan, but in this case life threw a complete strike out. Money sources are completely cut off and I can’t say for sure but this small town doesn’t have 600 new jobs to support the lifestyle that these middle class workers have come to know and love.  Of course I wish I could help my fellow Londoners plan the next stage of their lives, but I wouldn’t even know where to begin.

So I’m reaching out to Dinks for advice.  If you lost your job tomorrow, what would be your next move?

Photo by peapodlabs



{ 3 comments… read them below or add one }

1 Fig @ Figuring Money Out January 6, 2014 at 11:55 am

Wow, that’s tough. It’s rough if that happens and you aren’t in a bigger city because there are fewer job options without moving. In my case I lost a job a few months ago and decided to go into full time freelancing and blogging. It helped that I was already doing it on a very part time basis as a hobby. Without that I probably would have had to find a part time job or three.

2 Jane January 7, 2014 at 5:58 pm

That’s a tough question no matter who you are, well unless you have some serious bank. This is one of those fears that keeps me up at night. My facility was put on notice a few months ago, I have 6 months to go. If I don’t find a job within the company, I’ll be packaged out. I’ve already gone through the phases and now I’m up to, whatever happens, happens.

I think my SO and I are in the minority though. We’ve both been there where we had little money and mounds of debt. We were very careful to dig out, have emergency savings and removed most of our debt (only have the house). While it would suck being out of work, we would manage. I fall back on thinking I’m a fairly smart individual, things work out in the end. But to your original question, not sure what I would (will) fall back on. For me, I’m most worried about the benefits like medical (I’m in the US). I have some ideas about starting my own business, that may be the time. And that may also not be an option depending on finances at the time. My SO is convinced this change in my employment will bring out an idea in me where I will finally enjoy the work I do. Fortunately, my SO has a good job. But I don’t want to be out of work for long because of the impact to retirement.

Not really an answer, just some thoughts on what others are thinking. :)

Jane

3 Kristina January 8, 2014 at 10:16 pm

I am sure no one wants to lose their job and it can be earth shattering – trust me I know. I didn’t have a back up plan at the time but after a little bit of wallowing I kicked my but in gear and went into survival mode.

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