5/13/2011

Preparing for One Income

Quite a few people have asked if we have a plan in case one or both of us loses a job and/or I get pregnant – totally valid concerns. Jordan and I have talked a bit about this and I’m happy to share that our conversation with you.

The first thing to recognize is that we are in very different industries and the likelihood that we would lose our jobs at the same time is highly unlikely. He is a Parts Supervisor currently in his second year (of three) of his apprentiship which will culmination with a red seal designation. I’m a Human Resources professional currently pursuing my CHRP. I mention our education only to explain that we are not stagnant in our careers – we are both continuing our education and presence in our respective industries.

Though we are both in the first five years of our careers we also both made it through the recession and came out strong – we both received raises in a time where people were losing their jobs. I say this to explain that we are both highly valued where we work.

So - all that to say is that I don't believe we need to be able to survive on just EI, but EI plus one income. For the purpose of the exercise I kept Jordan with the Job and me on EI and played with the numbers - this isn't of course set in stone, but shows that it could be done :D


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5 comments:

  1. Here's some info from the government website:

    "Your EI payment is a taxable income, meaning federal and provincial or territorial, if it applies, taxes will be deducted."

    Having been on EI in the last year, I can tell you that the bi-weekly payment is just over $800 after taxes in Alberta (I believe $805), for a total of $1600 a month (I am maxed.) BC will be slightly different.

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  2. Didn't think about that but I am glad to see you have some form of backup plan. I think it's cool to assume that none of you will lose your jobs anytime soon. I know a lot of people always tell you plan for the unexpected but sometimes you just have to have faith and go forward with a prosperous mind.

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  3. I'm confused- thinking along the same lines as Shenanigans- is that EI amount pre-tax as it is higher than what I thought the max amount was?

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  4. It is the pre-tax amount. I was comfortable using that because for the first 15 weeks of my leave, my work tops up my salary to 70% of my base - so I was averaging everything out :D

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  5. I've been reading about EI for mat leave (as this is an imminent situation for us-first baby due July 5) and there are some horror stories about paying huge tax bills at the end of the year you're on leave, because the government doesn't take enough off in taxes while you're on leave. Just mentioning it so you don't get surprised. I'm trying to figure out how to avoid this problem, but as I find our tax system as clear as mud, I'm not getting too far.

    That said, good on you for planning ahead like this. I have similar thoughts about DH and I-it's unlikely that we would both be out of work at the same time (barring an accident in which we were both hurt-but we have disability insurance, so hopefully that will cover that risk), so I have made "emergency budgets" assuming that one of us has lost our paycheque all together to see how we would do it. This was really helpful when we found out we were pregnant, because I already had scenarios worked out.

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