Scary news

Mike called me at work the other day to let me know (before I heard it on the news) that all of the employees of his company had been "furloughed" without pay until further notice. Basically, the sale of the company to the new buyers has been taking longer than anyone anticipated. The great majority of the funding is coming from a Russian bank and the bankruptcy court wants to make sure (in light of current global economic troubles) that the bank is solvent and the funds are good. Because of this, the interim funding that the new buyers provided to keep the company running during the transition is quickly dwindling. They hope by having everyone but a skeleton crew go home, that they can conserve enough funds to keep things going until the sale is finalized. Then (they say) everyone can come back to work.

The same day this happened, we had several other businesses go under in our state, leaving around 2000 people without jobs/paychecks. The governor took action to help speed up unemployment benefits -- and apparently those employees in my husband's company who have been furloughed will be able to apply for unemployment benefits (even though they have not been technically laid off or fired). I'm not sure how that will work and I'm hoping its not even necessary, since the new buyers seem to think it's just a matter of days before things are finalized.

At my job, the president of the company issued an email to all employees, explaining that the company has lost $2 million more per month for the past two months than they had anticipated (which seems to indicate that MORE than $2 million per month was lost). Apparently, people are not going to get medical care as they used to and, if they do get care, they are less likely to pay. The president basically said that the company cannot continue to hemorrhage money like this and stay solvent. They are trying desperately not to lay off any employees, but that may not work. Of course, temporary employees like myself will be the first to go if things get worse. As it is, the past several weeks I've been told to go home when there are not enough providers in our office to keep everyone busy all the time. Of course, as I'm a temp employee, when I go home, that means I don't get paid for that time off. It's a particular concern now that my husband is also not getting paid.

We are hopeful that things work out for my Mike's company and that he is told to report back to work within the next week or so. In the meantime, I'm doing as much freelance work as I can and also asking to be flexed out to other departments within my company (if my department does not need me and some other department can use me). We've got a few major expenses coming up immediately that we had saved for -- but its scary to use those funds on the replumb and bathroom remodel when we don't know for sure that my husband will be employed or not. However, not to spend the money is not really an option at this point, as the bathroom has to be put back together and the replumb must take place or we will loose the option. Granted, we could not do the additional work (of continuing the replumb to the street) -- but we both agree it is a good investment for a future sale of the house (not to mention that the piece of mind that we will not have a leak under our foundation/slab is priceless). We did start the refinancing process on our home about a month ago, locking in a 5% fixed rate (down from the 6.375% we had originally). We close on that new loan on Monday, which will save us about $250 per month on our mortgage payment. Every little bit helps at this point.

Nearly everyone I know has been effected to some degree by this horrible economy. I don't know that I agree with everything that the government has done to try to fix it -- and I expect things will not get better for quite some time. I know that there are some that are much worse off than we are, even with our current problems. I'm grateful every day for our savings and for my husband's military retirement pay, which is enough to pay our mortgage under the worse circumstances. We've also finished paying for my daughter's college for this year -- so we have some time until the fall semester starts to figure out how to deal with that. Once the replumb and bathroom remodel is done, then I think I'll be able to take a deep breath, reassess, and draw up a new budget so that we can all feel more at ease, knowing everything will be paid, even if Mike becomes truly unemployed.