also used her severance package and unemployment aid to pay their monthly expenses, which were a little more than $2,300. Eventually, the money ran out. “The second income of my family disappeared,” laments Moore. So the family found ways to downsize, such as trading in one car and sharing the other.
To stay in the loop professionally, Moore parlayed her education and experience into service opportunities. She sat on the board of directors for entities including Head Start and did some consulting for Manpower, a global staffing services firm. Today, Moore is a diversity consultant at Northwestern Mutual, a Wisconsin-based insurance and investment firm. She has put her plan to start a nonprofit on the back burner to help rebuild her family’s finances. “Working here motivates me to stay on top of our finances in a way I didn’t before I was laid off the first time,” indicates Moore. Now, she and her husband track all household expenses in a streamlined budget. In addition, she’s been more aggressive about saving for the future and has selected a professional financial planner.
Having weathered two layoffs, Moore feels prepared to handle another should it come her way. “My ultimate goal is to be an entrepreneur,” she says. “If I were to get laid off again, I still have a path to travel. A layoff creates an opportunity for so many of us to own our own businesses, and I don’t think a lot of us realize that.”
Hacked to Pieces
By contrast, there was nothing happy about Morris T. O. Hendricks’ ordeal. The Falls Church, Virginia, resident was unexpectedly let go from his $50,000-a-year position as assistant general manager of The Paradies Shops in Washington Dulles International Airport in Dulles, Virginia, in the spring of 2004. His layoff resulted in an emotional reaction so severe it required medical attention and led to financial ruin that nearly did the same to his marriage.
“I went from being praised in the company’s monthly newsletter for improving customer service, boosting employee morale, and helping our location exceed all sales goals to being laid off by the regional manager,” says Hendricks, 30. “My emotions were in complete disarray. I was diagnosed with severe anxiety and depression.”
To complicate matters, Hendricks and his wife, Maria, had just had their first daughter. The couple ate through their savings, maxed out their credit cards, and used Maria’s 401(k) plan contribution funds to pay their household expenses. By December 2004, they had nothing left in savings and had racked up $50,000 in debt. “Our credit score went from the upper 700s to the lower 400s,” recalls Hendricks. The financial strain, heightened by Hendricks’ emotional state, was too much for his marriage to bear: Maria put the couple’s belongings in storage, took their daughter, and moved back home with her parents.
In early 2005, a humbled Hendricks took an $8-an-hour job as an overnight auditor at Embassy Suites in Herndon, Virginia. He managed not to incur any new expenses, as family friends provided him food and shelter.