After 30 yrs at Megacorp my IT job was surplussed...

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supernova72
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After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Somewhat anticipated but still internalizing what my next steps are. I work in an aerospace industry in an IT organization. Megacorp (160,000 employees).

IT is being reduced and after 30 yrs I got my notice yesterday. Planned on working two years. I get a 6 month severance pkg.

It feels weird since I've never been "laid off" before.

About me:
55 yrs old (can ER at 55)
single
retiree medical (options are below)
750K in 401K (can draw at 55 without 10% penalty)
pension (non cola) at $3100 a month (can draw after my layoff benefit ends in 6 months). I can also take a lump sum on the six months pay.
expenses are 60K a year. Pension is now frozen so the growth for delaying drawing it is pretty small (like $8 a month).
After final check July 22nd will owe 125K on home (valued at 535K---Seattle WA). No other debt.


Feels weird but to be honest was pretty stressed out at work the last 3 yrs (We've had 3+ yrs of reductions). My background is IT Finance and IT Service Delivery mgmt. I achieved a "level 5" status which is high in my field. I might pursue contract work. Seattle WA is a pretty hot market right now (where I live).

Two undergrad degrees and one masters (TMBA)

I get retiree medical and can either do a low deductible plan at $46 a month and $30 co-pays OR a high deductibable plan with $1300 deductible and no co-pays. Still figuring out which is best. Will have about $4K in my HSA by the time I 'retire'. Even though it feels weird it's been one heck of a run and I am calling the move forward plan phase II.

Last day is mid-July 2016. Apologize in advance if you saw this on ER.org.

Cheers.
Last edited by supernova72 on Mon Jun 06, 2016 2:43 pm, edited 3 times in total.
Hikes_With_Dogs
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Hikes_With_Dogs »

From what I can tell, congrats are in order!!!
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David Jay
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by David Jay »

Looks like you will be okay, even if without any consulting work.

You only need about $23,000 a year for living expenses until SS, Social security will be more than that, so you only have to draw down your 401K for a few years (12 years to FRA).

You can take advantage of the "equal withdrawals" rule to get the funds you need out of the 401K until age 59 1/2.

All the best!
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Thanks---I should have included I can withdraw from 401K without 10% penalty. I wasn't planning on drawing so early so that is why I was considering some PT consulting work---or winning the lottery :)
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nedsaid
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by nedsaid »

Been there, done that, bought that t-shirt. Except in my case, it was 15 plus years and not 30. Thank goodness, I was a very good saver and an average investor. Getting laid off is never fun but I am sure it was a relief when it finally happened. It is hard when the sword of Damocles is overhead.
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Carl53
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Carl53 »

supernova72 wrote: I get retiree medical and can either do a low deductible plan at $46 a month and $30 co-pays OR a high deductibable plan with $1300 deductible and no co-pays. Still figuring out which is best. Will have about $4K in my HSA by the time I 'retire'. Even though it feels weird it's been one heck of a run and I am calling the move forward plan phase II.
Cheers.
How healthy are you? Consider the past several years of medical expenses when selecting your plan. If you have been healthy the high deductible plan probably would be best. Do you have the option to change to the alternative plan in the future if desired? Are either of the plans PPO?

Your stated annual expenses are 60k. Does this include your mortgage payment of $XXXX and income taxes of $YYYY? You might be wise to consider downsizing or relocating if desirable to a less costly accommodations. You would likely lower your monthly expenditures substantially.

Consider bumping up your 401k withholding to the maximum allowed for your last paycheck or two. You might as well get close to the $24000 annual limit as possible.
NMJack
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by NMJack »

Megacorp sucks. Been there twice.... :(

Hang in there and be thankful you made it out financially alive. :sharebeer
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Carl53 wrote:
supernova72 wrote: I get retiree medical and can either do a low deductible plan at $46 a month and $30 co-pays OR a high deductibable plan with $1300 deductible and no co-pays. Still figuring out which is best. Will have about $4K in my HSA by the time I 'retire'. Even though it feels weird it's been one heck of a run and I am calling the move forward plan phase II.
Cheers.
How healthy are you? Consider the past several years of medical expenses when selecting your plan. If you have been healthy the high deductible plan probably would be best. Do you have the option to change to the alternative plan in the future if desired? Are either of the plans PPO?

Your stated annual expenses are 60k. Does this include your mortgage payment of $XXXX and income taxes of $YYYY? You might be wise to consider downsizing or relocating if desirable to a less costly accommodations. You would likely lower your monthly expenditures substantially.

Consider bumping up your 401k withholding to the maximum allowed for your last paycheck or two. You might as well get close to the $24000 annual limit as possible.
Good tips for sure on 401k max etc. I've upped my contribution to 45% for the last four paychecks to get close to the max. On health I'm in pretty good shape (workout 6 days a week--cardio/running, and weights). One exception is recently went on BP meds which bummed me out. Maybe a less stressful lifestyle will help my BO out. Our med plans are PPO I believe yes. "Advantage Plus" it's called. I'm on the high deduct now as we get $1K seed money. That will go away however. Most of my medical costs are PT when I injure myself running :oops:

Need to figure out if I can switch med plans mid-stream. Great question...

Yes that $60K does include mortgage (4%, 15 yr, paying extra when I can).
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

NMJack wrote:Megacorp sucks. Been there twice.... :(

Hang in there and be thankful you made it out financially alive. :sharebeer
Thank you. I'm trying not to focus on the layoff part and what opportunities are ahead of me yes.
campy2010
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by campy2010 »

Sorry to hear about your surplussing. My only tip is to sign up for unemployment when your severance is complete. Some people skip this step.

I would probably take the summer off and look for another job in the fall. I wouldn't want to end my career on a layoff. But being able to ER and in a hot job market means you can decide your next move. The power of being a Boglehead. :-)
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GerryL
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by GerryL »

Question about your pension: Can you delay taking it to let it grow? Or is the figure you gave fixed? You might want to explore that and see if/how a growing pension would factor into your decisions.

Best of luck. My old company is doing a lot of this right now. Three former colleagues lost their jobs last year and three more are going this month -- and it was a small group. Interestingly all 6 qualified for early retirement. High tech industry, so no pension and no retiree healthcare, but better severance and COBRA.
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Meg77
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Meg77 »

I know it's disorienting and kind of maddening to be laid off. Been there. But you'll shake it off quickly I promise.

Sure you can keep working, but you're a millionaire plus you have a $3100 a month guaranteed income, plus you'll probably have additional income from social security in another decade. You can do whatever you want! Congrats.

I don't know where you live but $535K seems like a lot of house for a single guy. You could sell it (or lease it) and travel the world for a year on your severance check. Just an idea. :D
"An investment in knowledge pays the best interest." - Benjamin Franklin
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

campy2010 wrote:Sorry to hear about your surplussing. My only tip is to sign up for unemployment when your severance is complete. Some people skip this step.

I would probably take the summer off and look for another job in the fall. I wouldn't want to end my career on a layoff. But being able to ER and in a hot job market means you can decide your next move. The power of being a Boglehead. :-)
Thanks...after looking at the options and talking to the WA state UE office it would be best to take the lump sum severance and apply to UE (they say that can be done). If I take the continued income severance I can't get UE.

Having said that I can't draw my pension until UE runs out. Decisions!
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Meg77 wrote:I know it's disorienting and kind of maddening to be laid off. Been there. But you'll shake it off quickly I promise.

Sure you can keep working, but you're a millionaire plus you have a $3100 a month guaranteed income, plus you'll probably have additional income from social security in another decade. You can do whatever you want! Congrats.

I don't know where you live but $535K seems like a lot of house for a single guy. You could sell it (or lease it) and travel the world for a year on your severance check. Just an idea. :D
Oh, on the house I live in Seattle WA proper so that is pretty much an entry level home (no kidding!). My house value increased by 10% in 2015. I really want to keep the house so at this point not thinking of downsizing or moving (all my family lives in WA state).

funny you said that about the net worth---my sis said the same thing. I don't feel like a millionaire? :? but hey, this job surplus could have been worse with no pkg or vacation payout etc.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

GerryL wrote:Question about your pension: Can you delay taking it to let it grow? Or is the figure you gave fixed? You might want to explore that and see if/how a growing pension would factor into your decisions.

Best of luck. My old company is doing a lot of this right now. Three former colleagues lost their jobs last year and three more are going this month -- and it was a small group. Interestingly all 6 qualified for early retirement. High tech industry, so no pension and no retiree healthcare, but better severance and COBRA.
Good question on pension: It was frozen at the end of 2015 so the growth is pretty small by waiting ($8 a month).

I'm in an IT group within a non IT megacorp (aerospace type work). I'm fortunate to have my retirement benefits that is for certain. Sorry to hear about your former colleagues.
campy2010
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by campy2010 »

supernova72 wrote:
campy2010 wrote:Sorry to hear about your surplussing. My only tip is to sign up for unemployment when your severance is complete. Some people skip this step.

I would probably take the summer off and look for another job in the fall. I wouldn't want to end my career on a layoff. But being able to ER and in a hot job market means you can decide your next move. The power of being a Boglehead. :-)
Thanks...after looking at the options and talking to the WA state UE office it would be best to take the lump sum severance and apply to UE (they say that can be done). If I take the continued income severance I can't get UE.

Having said that I can't draw my pension until UE runs out. Decisions!
I would choose the lump sum severance, regardless of the UE vs pension decision. The only benefit of monthly severance would be to defer some of the income into the next tax year. But 6-months of severance from July will get you to January. Not much benefit to monthly payments. I would choose investing the money in July.

$3100/month pension vs the ~$1600/month unemployment is a no-brainer. Definitely the pension. But some pensions take time for the paperwork to process so you may be able to take the unemployment in the interim. Might or might not be worth the effort.
tim1999
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by tim1999 »

supernova72 wrote: Thanks...after looking at the options and talking to the WA state UE office it would be best to take the lump sum severance and apply to UE (they say that can be done). If I take the continued income severance I can't get UE.
This is a pretty sweet deal. A friend of mine got let go back around the time of the 2008 crisis, he was 63 anyway and had been thinking of retiring at 64, then draw from his 401k and SS. Once the dust settled, he got six months of severance lump sum, then like 70+ weeks of unemployment or whatever the "special temporary extension" was in our state at the time. He looked for work real hard while on the golf course and his boat... You've got it made!
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by roymeo »

When I got the layoff announcement the day Obama first was inaugurated, I did the math and came up with 13 rounds of layoffs i'd seen in 13 years programming/software engineering & management. I wasn't always the one who drew the black spot, and that's not counting the 10k-30k worker layoffs when I was working at Kodak in the noughties.

That's been 7 years, and 5-7 more layoffs since then.

I can't imagine working anywhere for 30 years--sounds like a good thing. :)

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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by KlangFool »

supernova72 wrote:
campy2010 wrote:Sorry to hear about your surplussing. My only tip is to sign up for unemployment when your severance is complete. Some people skip this step.

I would probably take the summer off and look for another job in the fall. I wouldn't want to end my career on a layoff. But being able to ER and in a hot job market means you can decide your next move. The power of being a Boglehead. :-)
Thanks...after looking at the options and talking to the WA state UE office it would be best to take the lump sum severance and apply to UE (they say that can be done). If I take the continued income severance I can't get UE.

Having said that I can't draw my pension until UE runs out. Decisions!
supernova72,

Please check whether you get continuing medical coverage from the employer if you take the continued income severance.

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surfstar
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by surfstar »

Congratulations on your retirement! :sharebeer

Take some time off, then see if you miss anything about work, afterwards. Enjoy your first free summer since high school!
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by ourbrooks »

Are you actually still working or did they escort you out the door? If they're still letting you work, they must trust you not to get revenge in the next six months. In fact, compared to other people's layoff experiences, they're sending you a message: get off the payroll but don't go away mad. A better bet than the stock market is that they offer you consulting work at a pretty good rate. If you do the numbers and add up the cost of all of your benefits, the consulting rate won't look so good after all, which is why they're laying you off. Also, in the future, they can get rid of you on a day's notice, not six months.
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Watty
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Watty »

Hikes_With_Dogs wrote:From what I can tell, congrats are in order!!!
+1

And you will have Social Security too so financially you look fine.

I retired voluntarily from IT last summer just before I turned 59 after 26 years with the same company. I would have a hard time going back to work again. My last day at work I took a picture of my alarm clock at 5:30 AM which is when I was having to get up because of the morning commute. I sure will not miss the commute! It takes a while to get used to being retired but six months from now you will be thanking them for laying you off especially if you keep in touch with your old coworkers and hear the BS they are still dealing with.

Since your house is not paid off yet you might consider eventually moving to a less expensive house in either a lower cost of living area or by moving to a less expensive area of Seattle. You likely live where you are now in part because of the commute but in many areas the housing is dramatically less expensive even 20 minutes farther out so if you want to stay in Seattle you should keep an open mind about moving a bit farther out to an even nicer house that you could buy for cash. That would also give you a chance to find a retirement home that will work well when you are 80+ and don't want to deal with things like stairs.
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steve roy
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by steve roy »

Silly, minor thing re your workout routine.

If you run for cardio, I would consider walking for cardio instead. I pounded away as a runner for eighteen years, then the shin splints started, I got more aches and pains ... and I switched to power walking. (I tried bicycling but after coming close to being greased by cars a couple of times, I dropped the biking thing.)

Just a thought. (I know folks who've run for years and they are now getting hips replaced. Walking is easier on joints.)
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Capsu78 »

Hopefully you have a robust LinkedIn profile with a professional looking photo with 500+ contacts... If you don't, I would play furious catchup with every person you have met in your professional life... In 2009, my wife was packaged out of not quite Megacorp but certainly BigCorp. She had not set up her profile so we did that her first day out.
It took 5 months in a crappy economy of doing all the legwork to land "on a runway and not in a corn field". New MegaCorp found her through LinkedIn and she now has been with MegaCorp almost 7 years, in an tech industry she never would have considered herself qualified for. Now she gets contacted by headhunters nearly monthly.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

campy2010 wrote:
supernova72 wrote:
campy2010 wrote:Sorry to hear about your surplussing. My only tip is to sign up for unemployment when your severance is complete. Some people skip this step.

I would probably take the summer off and look for another job in the fall. I wouldn't want to end my career on a layoff. But being able to ER and in a hot job market means you can decide your next move. The power of being a Boglehead. :-)
Thanks...after looking at the options and talking to the WA state UE office it would be best to take the lump sum severance and apply to UE (they say that can be done). If I take the continued income severance I can't get UE.

Having said that I can't draw my pension until UE runs out. Decisions!
I would choose the lump sum severance, regardless of the UE vs pension decision. The only benefit of monthly severance would be to defer some of the income into the next tax year. But 6-months of severance from July will get you to January. Not much benefit to monthly payments. I would choose investing the money in July.

$3100/month pension vs the ~$1600/month unemployment is a no-brainer. Definitely the pension. But some pensions take time for the paperwork to process so you may be able to take the unemployment in the interim. Might or might not be worth the effort.
Oh, on UE (I called already) it would be ~$2877 a month and might get a COL increase in July she said. I realize that is less than $3100 but was not thinking a deal breaker. WA State UE that is.
Last edited by supernova72 on Mon Jun 06, 2016 4:37 pm, edited 1 time in total.
icefr
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by icefr »

Meg77 wrote: I don't know where you live but $535K seems like a lot of house for a single guy. You could sell it (or lease it) and travel the world for a year on your severance check. Just an idea. :D
He's in Seattle. My two bedroom condo in Seattle is worth about $550k and I would really love to never sell this. I would leave it empty and go traveling and come back to it.
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by tnr »

Sorry for the stress of forced ER but you are in good shape financially. When this happened to me 4+ years ago, I looked for work in university environment. Was tired of the corporate bs. The money is lower but the satisfaction in my new job is much higher. If you want to work again, check out non-profits. Good luck.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Hikes_With_Dogs wrote:From what I can tell, congrats are in order!!!
Thanks for the positive words!! I know I could have saved more and wish I were debt free but then again I also wanted to live a bit too. :happy
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by joyanni »

Congrats on landing safely after the layoff accident ( unless you think it is actually a good thing :-) ). I hope and wish to be in the position of not worrying about having a job and only working because I want to. I do not have a pension but am thinking of looking for a job with one.
My question to you is if you have thought about taking the lumpsump for the pension instead of monthly $3100. Wouldn't that be a better option to have that large sum of money in your control - could be at least $700,000 or even greater depending on their calculations
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

joyanni wrote:Congrats on landing safely after the layoff accident ( unless you think it is actually a good thing :-) ). I hope and wish to be in the position of not worrying about having a job and only working because I want to. I do not have a pension but am thinking of looking for a job with one.
My question to you is if you have thought about taking the lumpsump for the pension instead of monthly $3100. Wouldn't that be a better option to have that large sum of money in your control - could be at least $700,000 or even greater depending on their calculations
I looked at the lump sum option but for me it doesn't really pencil out too well. As you are most likely aware the company was required to use the IRS mortality and interest rate factors (3 tiers) and my lump sum would be $485K. To generate the same income stream as my pension I would need to get a lump sum of ~$625K ish so I'm going to pass (used immediateannuties.com). Some take it so they can "manage" it or pass it along to family but for me the family part took care of itself (mom, sisters are both married, nieces all are doing fine financially).
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Greentree »

Consulting when you don't absolutely need the money is great (from what I've observed, not me yet). You take the jobs you want, tell the ones you don't want that you are too busy and it is a world of difference from working in megacorp. It might take a year or two to build up but then you'd have income when you want it. Though it doesn't appear that you need to work at all.
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by madbrain »

nedsaid wrote:Getting laid off is never fun but I am sure it was a relief when it finally happened.
Well, it depends. I was actively trying to get laid off in my last job at a Megacorp, when mass layoffs were announced in the press, but employees were not notified yet. I had been interviewing somewhere else at the same time. The offer came the day before my layoff notice. It was a very good package - 6 months, when I had only worked there 18 months.
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by ClevrChico »

Hikes_With_Dogs wrote:From what I can tell, congrats are in order!!!
I agree, it sounds like whether you work or ER, you're solid. Congratulations!
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

steve roy wrote:Silly, minor thing re your workout routine.

If you run for cardio, I would consider walking for cardio instead. I pounded away as a runner for eighteen years, then the shin splints started, I got more aches and pains ... and I switched to power walking. (I tried bicycling but after coming close to being greased by cars a couple of times, I dropped the biking thing.)

Just a thought. (I know folks who've run for years and they are now getting hips replaced. Walking is easier on joints.)
Yea, I realize running is hard on the body but I have not yet found an alternative that provides the same intensity in the same timeframe. I still do local fun run races but the shorter ones like 5K's vs. half marathons (did about 20 of them). I'm faster than a jogger but not a track star. Two weeks ago did a local 5K and placed 6th out of 52 in my age group so some would say I'm "competitive". Ha.

I know I can't do it forever and am a low milage runner (12 miles a week when not training for a race).

FYI: I've had shin splints and buying better shoes (not Big 5 no name) fixed it.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Greentree wrote:Consulting when you don't absolutely need the money is great (from what I've observed, not me yet). You take the jobs you want, tell the ones you don't want that you are too busy and it is a world of difference from working in megacorp. It might take a year or two to build up but then you'd have income when you want it. Though it doesn't appear that you need to work at all.
Thanks. It was more about me not being very prepared to not be working vs. the money part. I've been at this for 30+ yrs without a gap in employment. I would love to work for a smaller place where I can experience a new environment and staff.
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Will do good
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Will do good »

I was layoff Feb 2009 on top of the great recession, like you I was a little scare.
Instead of looking for a job I started my own business and business took off, I ended up making multiple times my old income since.
I'm retiring the end of this year, couldn't be more happy and set.
May your Phase II be happy regardless of ER or new direction. :beer
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by TimeRunner »

supernova72 wrote:Yea, I realize running is hard on the body but I have not yet found an alternative that provides the same intensity in the same timeframe. I still do local fun run races but the shorter ones like 5K's vs. half marathons (did about 20 of them). I'm faster than a jogger but not a track star. Two weeks ago did a local 5K and placed 6th out of 52 in my age group so some would say I'm "competitive". Ha.
Cycling up hills is a pretty good alternative. Use smaller gears and higher cadence. Wife and I did the 2 hour 20 minute bike trainer video riding up Haleakala from 3000 to 10000 feet Saturday. Of course we were breathing at near sea level so not the same, but we still had a pretty good puddle contest. Masters swimming will also give you a good workout in a short amount of time without wearing out your joints. The camaraderie of mutual suffering vs lone running helps. Mix it up - your body will thank you. :)
One cannot enlighten the unconscious. | "All I need are some tasty waves, a cool buzz, and I'm fine." -Jeff Spicoli
goldenbb
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by goldenbb »

Just consider how fortunate you have been. Most of the young people starting out in the IT field today are in a mess they have no idea about. Non-software companies are the worst when it comes to IT--places where IT is a cost center are just so dog eat dog about everything. And I bet whatever offshoring they are doing will utterly fail to gain quality results. Management that does this stuff is incompetent and are basically looters.

Best of luck to you, I'm sure you will be fine if you are at all good at what you do.
goldenbb
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by goldenbb »

supernova72 wrote:
joyanni wrote:Congrats on landing safely after the layoff accident ( unless you think it is actually a good thing :-) ). I hope and wish to be in the position of not worrying about having a job and only working because I want to. I do not have a pension but am thinking of looking for a job with one.
My question to you is if you have thought about taking the lumpsump for the pension instead of monthly $3100. Wouldn't that be a better option to have that large sum of money in your control - could be at least $700,000 or even greater depending on their calculations
I looked at the lump sum option but for me it doesn't really pencil out too well. As you are most likely aware the company was required to use the IRS mortality and interest rate factors (3 tiers) and my lump sum would be $485K. To generate the same income stream as my pension I would need to get a lump sum of ~$625K ish so I'm going to pass (used immediateannuties.com). Some take it so they can "manage" it or pass it along to family but for me the family part took care of itself (mom, sisters are both married, nieces all are doing fine financially).

Have you considered the risk of the pension plan going bankrupt at some point in the future? All pensions seem to be under extreme stress these days. The lump sum would at least be yours to invest and not in the hands of the same incompetent management that decided lay offs are good for morale.
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Watty
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Watty »

supernova72 wrote: Yea, I realize running is hard on the body but I have not yet found an alternative that provides the same intensity in the same timeframe.
One of the changes in retirement is your perspective on time changes and you end up being in less of a hurry. I have never been a runner but since I have retired I have gotten into a routine of usually going out for 2+ hour walks on local trails four or five times a week and I miss it when my schedule or the weather doesn't allow me to do it for several days in a row.

It is not for everybody, including myself, but a friend of mine hiked the Appalachian Trail after he retired at the age of 62.
mickroark
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by mickroark »

Spend that money now and enjoy it. It does not spend well at 6 feet under. I have witnessed that most retirees live around 5 years, depending on if they smoked or not. My father in law just passed away with too much money leftover, he always told to me you cannot take it with you. Its true believe me.
Spitfire
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Spitfire »

Are you a SPEEA employee?
tigermilk
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by tigermilk »

While not as old, my father-in-law had a stroke which eventually resulted in early retirement, He never adapted, was never joyful, and died a few years later. My father was forced to retire early due to layoffs (aerospace sector, IT manager) and has absolutely loved it. My mother still worked for a few more years and was very envious. She's finally caught up to his happiness of not having to go to work everyday. Enjoy the ER and look at it as a blessing.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

goldenbb wrote:
supernova72 wrote:
joyanni wrote:Congrats on landing safely after the layoff accident ( unless you think it is actually a good thing :-) ). I hope and wish to be in the position of not worrying about having a job and only working because I want to. I do not have a pension but am thinking of looking for a job with one.
My question to you is if you have thought about taking the lumpsump for the pension instead of monthly $3100. Wouldn't that be a better option to have that large sum of money in your control - could be at least $700,000 or even greater depending on their calculations
I looked at the lump sum option but for me it doesn't really pencil out too well. As you are most likely aware the company was required to use the IRS mortality and interest rate factors (3 tiers) and my lump sum would be $485K. To generate the same income stream as my pension I would need to get a lump sum of ~$625K ish so I'm going to pass (used immediateannuties.com). Some take it so they can "manage" it or pass it along to family but for me the family part took care of itself (mom, sisters are both married, nieces all are doing fine financially).

Have you considered the risk of the pension plan going bankrupt at some point in the future? All pensions seem to be under extreme stress these days. The lump sum would at least be yours to invest and not in the hands of the same incompetent management that decided lay offs are good for morale.
Company is financial very strong and pension plan well funded. Revenues are strong ($98B with a B) and net income is also improving. Cash flow from operations is also strong. Can you tell I started in finance? Ha.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Watty wrote:
supernova72 wrote: Yea, I realize running is hard on the body but I have not yet found an alternative that provides the same intensity in the same timeframe.
One of the changes in retirement is your perspective on time changes and you end up being in less of a hurry. I have never been a runner but since I have retired I have gotten into a routine of usually going out for 2+ hour walks on local trails four or five times a week and I miss it when my schedule or the weather doesn't allow me to do it for several days in a row.

It is not for everybody, including myself, but a friend of mine hiked the Appalachian Trail after he retired at the age of 62.
True, true. I hope to get back into my regular Yoga routine as well.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

Spitfire wrote:Are you a SPEEA employee?
Not SPEEA (Engineering) so not represented no. IT is non-union.
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supernova72
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by supernova72 »

tigermilk wrote:While not as old, my father-in-law had a stroke which eventually resulted in early retirement, He never adapted, was never joyful, and died a few years later. My father was forced to retire early due to layoffs (aerospace sector, IT manager) and has absolutely loved it. My mother still worked for a few more years and was very envious. She's finally caught up to his happiness of not having to go to work everyday. Enjoy the ER and look at it as a blessing.
Thanks for the positive thoughts!
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FelixTheCat
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by FelixTheCat »

How interesting...it's the first time I am jealous of someone getting down sized. You have a good 401K amount, pension and retiree health at $46 a month. Contract work is just icing on the cake.

My advice. Take some time off and enjoy the summer before thinking about contract work. :sharebeer
Felix is a wonderful, wonderful cat.
surfhb
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by surfhb »

I'd say you won the game my friend!

Agreed to taking time off to see where your life leads.

Congrats!
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Meg77
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Re: After 30 yrs at Megacorp my IT job was surplussed...

Post by Meg77 »

supernova72 wrote:
Meg77 wrote:I know it's disorienting and kind of maddening to be laid off. Been there. But you'll shake it off quickly I promise.

Sure you can keep working, but you're a millionaire plus you have a $3100 a month guaranteed income, plus you'll probably have additional income from social security in another decade. You can do whatever you want! Congrats.

I don't know where you live but $535K seems like a lot of house for a single guy. You could sell it (or lease it) and travel the world for a year on your severance check. Just an idea. :D
Oh, on the house I live in Seattle WA proper so that is pretty much an entry level home (no kidding!). My house value increased by 10% in 2015. I really want to keep the house so at this point not thinking of downsizing or moving (all my family lives in WA state).

funny you said that about the net worth---my sis said the same thing. I don't feel like a millionaire? :? but hey, this job surplus could have been worse with no pkg or vacation payout etc.
Ironically, most millionaires describe themselves as "middle class." I get that about the condo, and yes cost of living is high in your area of course. I'd focus on paying off the mortgage then, and maybe at that point you'll feel as wealthy and financially free as you really are.
"An investment in knowledge pays the best interest." - Benjamin Franklin
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