Way back in April of 2013 (you know, when I was posting regularly here), I wrote about the Financial Side of My Layoff. Sadly, only 8 months later, I am writing about the financial side of losing my job, again.  While being in a job for 6 months and then being told you are not the right fit is a huge blow to the ego (or at least it is for me), financially, I am actually very lucky that it is happening so soon after my previous layoff.

Why? I really did have a great severance package.

First, my old company paid for Cobra for C and I for a year. We did not lose that coverage when I started working again (so we spent 6 months double covered). This means that we still have that Cobra coverage through the end of this May. (Pop Tart will continue to be covered by Medicaid until she has graduated high school, so I do not need to worry about coverage for her.)

Second, I had a 6 month severance package, and only spent 2 months out of work. That equated to 4 months of double pay, which ended only 3 months ago. We have not spent that money. It went into savings and has stayed there. If I had gone a year in this current job, I can almost guarantee that money would have been spent. But it has not been, so it is available to us now.

Going in to this job loss, I knew we would be financially okay, but until I ran the exact numbers this morning, I had not realized exactly how “okay” that would be. And while I am not the huge advocate of passive income that other personal finance blogs are, I do have to say, that does play a part.

When I am working, our normal monthly budget comes out to about $6,650. But that includes quite a bit of money that goes directly into savings each month. Taking out the money that goes to savings, we cut down to $5,325 each month. (And this is literally just taking out the money that gets funneled straight to savings. It is not paring down any other part of our budget.)

Passive income wise, we have $575/month in rent from the roommate, $750/month rent from the condo, and $400/month from the state (from adopting Pop Tart). This puts us at $1,725 in passive income each month, taking the expenses we need to cover down to $3,600.

I will be eligible for unemployment. Since I was on unemployment as recently as June, I have a very good idea of what I will be getting. It should be in the neighborhood of $600/week- which comes out to $2,600/month. Which means we only have a gap of $1,000/month that we need to fill from savings.

Still, we can reduce that $1,000. J currently owes us some money and is paying us back at the rate of $200/month. We are overpaying on our mortgage and could reduce that by $300/month. We are also overpaying on my student loans by $40/month. We can cut eating out and allowance spending by $175/month. That is $715 in cuts, meaning we could have only a $285/month gap between income and outgo.

But remember what I said about having savings from the double pay? We have over $25,000 in liquid savings. That means that even at the $1,000/month gap, we have over 2 years before we have to worry.

Considering I have already had one phone interview and have 2 more scheduled, I am doubtful I will be off even the two months I was last time, let alone for 2 years.

That means that for now, we will not be cutting back the extra payments on the mortgage and student loans. But we will cut back our allowance and eating out spending, and J is repaying us $200/month, so our gap really will be less than $1,000/month.

And when all is said and done, we will still have a healthy savings balance and have maintained our lifestyle. No drastic measures for us. It is amazing what a healthy emergency fund can do.