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Kyle Wingfield

Surviving on severance, burning through savings

1:07 pm November 10, 2009, by Kyle Wingfield

On a rainy day, an article from The Wall Street Journal about unemployed Americans who have burned through their rainy-day savings — and, in some cases, big-time severance packages — by maintaining the same lifestyles they had kept while they were working.

Several times over the past months I have found myself walking through a full parking lot at a shopping mall, or having to wait in line for a table at a restaurant, wondering “What recession?” People have been out spending money, albeit perhaps at not the same rates as before, and it’s made me wonder how many of them were like Paul Joegriner and his family:

The family’s lifestyle over the past year and a half has been propped up by a $200,000 severance package and another $100,000 in savings — funds the family has burned through rapidly. By Mr. Joegriner’s own calculations, the family will be out of money in six months if he doesn’t find work.

“It will be D-Day,” he says. “But on the outside, no one has any idea that we’re in trouble.”

Granted, two years is a long time for the chief breadwinner not to be winning bread. But $300,000 is also a lot of money — more, I would guess, than most readers of this blog (and their humble correspondent) have available to them in a given two-year period. Frugality would have made the money last longer, but Joegriner tells the WSJ that his family instead has continued to travel, send the kids to private school and dine out. They seem to have forgotten the “sever” part of “severance.”

Keeping up appearances, trying not to let a lost job crimp the kids’ style — these seem like the kinds of decisions that our more frugal forebears would have recognized as crazy. When people talk about an age of entitlement, of Americans wanting to gloss over the tough decisions, of “funemployment,” this is at the heart of it.

I wonder how much the maintained levels of spending under this severance economy, as the WSJ writer dubs it, have cushioned some of the impact of an already bad recession — and whether it will delay the arrival of a solid economic rebound.

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31 comments Add your comment

booger

November 10th, 2009
1:47 pm

I’m surprised that a person who could attain a position which yeilded a $200,000 severance package, and save $100,000 for a rainy day would use his resources so carelessly. I suspect for the first six months or so he fully expected to find a job quickly, so there was some denial involved. I also expect that at this point, assuming he doesn’t have additional resources, he is beginning to panic.

In the end he will probably have to take a job with less status and compensation than his old position, something I’m sure he is fighting. This, however, is a fact of life for many in our new economy. With a government hell bent on bankrupting the country, and clearly anti private enterprise, a vibrant economy is just a dream any time soon.

I suggest he apply for a Federal government position.

Hillbilly Deluxe

November 10th, 2009
1:47 pm

The family’s lifestyle over the past year and a half has been propped up by a $200,000 severance package and another $100,000 in savings

In my world we don’t have resources like that. Anybody who does burn through a severance package and savings like that is really sort of stupid.

Just as an aside, according to the Georgia Department of Labor website (a few months back anyway) the average Georgian that has been on their job 10 years, makes about $15 an hour. They could go 8-10 years on $300,000.

SS88

November 10th, 2009
2:10 pm

It would take me 6.67 years to gross $300,000 (8.40 years if I calculate based on net). So, if he’s looking for sympathy for how hard life is for him now, I suggest he pull out a dictionary and look between s*** and syphillis.

jconservative

November 10th, 2009
2:41 pm

I was out of work for 10 months and had three months severance pay.
The severance pay lasted 9 months. I then worked 6 months of part time.
I never touched a dime of savings.

I am not a genius but I am not a fool either.

Joan

November 10th, 2009
2:42 pm

We have a lot of spoiled brats in this country and many of them are between the ages of 22 and 45. He gets no sympathy from me. When he lost his job, a realistic look at what is going on in this economy, should have said, “get out from under that mortgage and scale down”. Since he didn’t do it, I hope the can learn to do it in future. If he isn’t a minority, he won’t get any sympathy or care down at the local welfare office.

spoiled brat

November 10th, 2009
3:10 pm

joan you ignorant slut….

DebbieDoRight

November 10th, 2009
3:58 pm

Oh well, leave it to joan to ingratiate race into the conversation. Good going Joan!! I bet you’re a republican too, you know — the ones who are always the very FIRST to play the race card!

Joan

November 10th, 2009
5:33 pm

Spoiled Brat and Debbie: Hey, I know it to be true. Go down to your local welfare office and check it out. It would be as much fun as those Acorn tapes. And look at the two of you, immediately jumping on the “race card” when the bulk of the message had to do with learning to live within your means. (And you mean initiate, not ingratiate). About the race card, and being Republican, well I didn’t know Jackson and Sharpton were Republicans, cause they are always the first. Good for them.

F-105 Thunderchief

November 10th, 2009
6:44 pm

Man, if you lose your job, unless you have eight figures in the bank, you put the spending on “stop.”

hryder

November 10th, 2009
9:23 pm

The one person, as well as others, has had a reasonable job offer that was rejected. The problem seems to be that many people think that a new job should pay as much, if not more, than the one that disappeared. Such people are out of touch with reality and logical thought. Remember, we are only entitled to life, liberty, and the pursuit of happiness(not the attainment-the pursuit).

TaxPayer

November 10th, 2009
10:06 pm

You pick a most interesting example, Kyle. By the way, what is the average household income in the US these days and how is the average household faring. Then, compare that to our financial gurus on Wall Street that think they’re doing God’s work while being overtaxed and under-appreciated by us lowly taxpayers.

Marc

November 11th, 2009
12:19 am

DebbieDoRight are you just being dense or what? Where did Joan SAY ANYTHING about race?

dewstarpath

November 11th, 2009
1:01 am

- Marc –
Joan used “race” in the last part of her entry at 2:42 PM –
“If he isn’t a minority, he won’t get any sympathy down at
the local welfare office.”
In other words, there are no non-minorities (read: whites)
on welfare.

Marc

November 11th, 2009
1:07 am

In Atlanta Caucasians are the minority same with DeKalb county so where is the race?

Marc

November 11th, 2009
1:14 am

Also there are more Caucasians on welfare than any other race.

Poker Face

November 11th, 2009
5:24 am

We are all robots (white and black robots mind you) marching to the edge of the government cliff and falling off one by one….we had hopes that the government would save us but it didn’t happen. There’s no turning back…eat, drink and spend like there’s no tomorrow.

Ga Values

November 11th, 2009
6:47 am

My best friend was the plant manager in Atlanta that closed late last year. He got 22 weeks of severance. Since he was 62 he started collecting $1,500.00 of social security, a $400.00 per month pension from a former employer and $350 a week of unemployment. He is retired and has over a million in his 401k but can legally collect $1,500 per month of unemployment for nearly 2 years. That loophole needs to be closed.

Lloyd Braun

November 11th, 2009
8:00 am

Kyle,
Awfully good of you to cast a jaundice eye at the unemployed. Hopefully, your next article will show similar compassion toward the homeless or mentally disabled. They are lazy people with flawed values who are parasites to the tax payer.
Mazel tov,
Brauny

Brad Steel

November 11th, 2009
8:08 am

Ga Values,

So for someone who worked and paid into unemployment insurance and social security until he was 62 doesn’t deserve the payout benefits?

That’s a really stupid thing to say. I suppose if your pal crashes his car or gets sick he should pay for it himself out of his 401k.

But thanks for your stupid comment.

Brad Steel

November 11th, 2009
8:12 am

It’s this guy’s money to spend. He’ll either get a new job or he’ll run out at which time you sanctimonious douchebags can say “told you so.”

I bet he gets a new job, doesn’t have to disrupt his kids lives by changing schools. keeps the cars, the house and the traveling.

Ga Values

November 11th, 2009
8:32 am

Brad Steel
8:08 am

Employees don’t contribute to unemployment compensation. Silly boy

SP

November 11th, 2009
8:43 am

Ga Values,

Since he is your “best friend”, why don’t you tell him how evil it is that he is taking advantage of the benefits he rightly deserves? Sounds to me that he did everything right. Explain to me how you would close this “loophole”

David Axelfraud

November 11th, 2009
9:41 am

YO KYLE! Just found this on yesterdays blog aimed at me. Now, you got on to me about arguing. You need to take care of this.

Robopublican

November 11th, 2009
12:48 am

DAVID AXELFRAUD? …..wotta piece of sh…..all she does
is complain and attack ppl….not a real republican, we dont
complain that much….fake gay pinko commie…..Cheney /
Palin 2012 !

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Robopublican

November 11th, 2009
12:51 am

- AXELFRAUD = pinko commie scum….. doesnt know the
difference between libertarians and conservatives …… GOP
stands for grand ole party….not girlie man oprah watching
party….go screw yourself you axelfraud scum

Robopublican

November 11th, 2009
11:55 am

…You dont kow how to hit anyone ….axelfraud, treat
others with respect and you get respect in return ….

David Axelfraud

November 11th, 2009
12:10 pm

Robopublican, you talk about treating people with respect and you sit there and call someone commie scum, screw yourself and fake gay pinko?

You can go F yourself!

David Axelfraud

November 11th, 2009
12:13 pm

Robopublican, before you go and PMS all over your keyboard, you should read comments that others wrote. I was name called first by dewstarpath the other day. She attacked me.

What is it about you angry liberal women?

RealPlayer

November 11th, 2009
1:15 pm

WOW- so much anger out there. Life is too short,
people. Know what I’m saying ? Especially you,
Axelfraud.

David Axelfraud

November 11th, 2009
1:16 pm

RealPlayer, sure I do hypocrite. Thanks for calling me out while ignoring Robopublican for calling me names. Go sell stupid over on Tuckers blog.

RealPlayer

November 26th, 2009
6:22 pm

- AxelFraud –

I can’t sell stupid. FOX News cornered the market
and you bought the motherlode of it. HA!

RealPlayer

November 26th, 2009
6:23 pm

- the only liberal woman here is you, Axelfraud,
with your constant diatribe.

RealPlayer

November 26th, 2009
8:19 pm

- I don’t know about Robo (it was offensive what he
said), but you’re all over the blogs chewing people
out. Can we all get along ?

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