A Spending Analysis During a Layoff: What I Cut, What I Kept, and What Mattered

The scariest professional event happened: I was being laid off. It was announced during a quarterly performance review session. I had all the visceral physical symptoms you would expect- my heart racing, literal shock, and obvious fear. It had never happened to me before.

Luckily, I had consumed enough practical financial literature to always be prepared for an unexpected event. That preparation helped me push beyond the immediate fear of monetary loss and advocate for a sensible exit. I don’t think I would have been able to do that if I had crumbled under the weight of what a future loss of income might mean.

I credit my ability to quiet the part of my brain that was ready for catastrophe to years of intentional living.

For context, I’ve been in a relationship throughout my entire professional career, and dual incomes have always been the norm. Our incomes also steadily increased over the years, which naturally led to ongoing conversations about where to put surplus funds. The goal was always simple: ensure our living expenses could be covered by a single salary.

That meant staying put in our starter home, diligently paying off all debt, and saving year-end bonuses. Even when the allure of being able to afford more became tempting, we always defaulted to the belief that peace of mind was more valuable than a larger or nicer physical item. It also meant keeping a close eye on household bills and spacing out larger expenses.

My favorite quarterly exercise when I had a steady income.

A quarterly exercise I liked to do was identifying our largest spending categories, a shortened version of a spending analysis. Because I manually tracked all our spending each month, I knew exactly, down to the dollar, what we were spending and what could be cut if we ever needed to downsize. I also knew where our discretionary funds were going. Our top discretionary spending categories were travel, home projects, dogs, and fitness. My mental math was always: if we decide to spend on something else, one of these will have to give.

It was also a valuable way to make sure our spending aligned with our values. Would a larger home with a garage in a nicer neighborhood bring me joy? Sure. Would it bring me enough joy to cut back on travel? Absolutely not.

That brings me back to the layoff.

Did it suck to lose the certainty of consistent paychecks? Yes. Did it drastically change or alter our lifestyle? Not in the slightest. I immediately reached for my Rifle Paper unlined notebook (my fav) and evaluated what we could do without. Paying a dog walker was an easy cut since I’d be spending more time at home. I also did some less obvious things: I called Georgia Power, Verizon, and USAA to see where we could lower monthly bills. Each of them had an offer I never would have known about had I not called and asked.

I carefully mapped out how far my severance could go and then made the next big decision: none of my upcoming trips would be canceled. In fact, I ended up extending a few of them. It’s no surprise that I love a good adventure, and while it would have made logical sense to cut those expenses, it was also easy to see that the trips weren’t going to put us in a perilous situation. Years of aligning our spending with our values gave us the margin to make thoughtful decisions instead of reactive ones. That meant extra days in Ecuador, a new trip to Oregon, more flexibility in Sri Lanka, and the most magical Christmas ski trip to Montana.