Laid off for more than a year, a former tech executive has nearly $800,000 in financial assets. But his biggest financial threat isn't the stock market—or even unemployment.
Losing a six-figure job is painful. Staying unemployed for more than a year is a different kind of financial nightmare.
Just ask Kevin McCann, 44, of Chicago.
The former senior product manager once earned more than $200,000 a year at a tech startup. Today, he's bringing in roughly $20,000 annually from freelance work while searching for his next full-time opportunity.
His unemployment benefits are gone. His savings are covering the gap. And despite having substantial investments, he's facing financial decisions that could shape his future for decades.
His story, recently featured in The Wall Street Journal, offers a reality check for anyone navigating a prolonged job search.
Nearly $800K Saved. Still Financially Vulnerable.
McCann isn't starting from zero. Far from it.
His financial picture includes:
$420,000 in traditional retirement accounts.
$81,000 in a Roth IRA.
$270,000 in a taxable brokerage account.
$26,000 across checking, health savings and Series I savings bonds.
A $625,000 condo, with approximately $344,000 remaining on the mortgage.
That's close to $800,000 in financial assets, plus substantial home equity.
But here's the catch: His monthly spending is around $5,000, while his current income covers only a fraction of it.
He has already cut expenses from $7,000 a month. Yet every month without a full-time paycheck means drawing down savings that took years to accumulate.
And there's one risk he's leaving dangerously exposed.
The Biggest Red Flag? No Health Insurance.
McCann currently has no health insurance.
He considered a high-deductible policy costing roughly $400 a month, but decided against it because of his reduced income.
Financial adviser Jarrett Solomon of Connecticut Wealth Management sees that as a serious mistake.
A medical emergency could turn a manageable unemployment situation into a financial crisis.
The lesson: When your income disappears, protecting your assets becomes just as important as preserving them.
Skipping insurance might save hundreds today. An unexpected hospital bill could cost tens or even hundreds of thousands tomorrow.
Don't Make a Big Tax Move Just Because You're Unemployed
With his income dramatically lower, McCann is considering converting traditional retirement savings into a Roth IRA.
The logic is understandable: Pay taxes at today's potentially lower rate rather than at a higher rate after returning to a well-paid job.
But Solomon recommends caution.
A large Roth conversion could generate a significant tax bill at precisely the moment McCann needs accessible cash.
Instead, the adviser points to another opportunity: Tax-gain harvesting.
Selling appreciated investments in a taxable brokerage account during a low-income year could allow McCann to realize some long-term capital gains at a 0% federal rate, depending on his total taxable income.
Reinvesting could also establish a higher cost basis, potentially reducing future taxes.
It's a reminder that unemployment can create tax-planning opportunities—but not every strategy is worth sacrificing liquidity.
Cut Spending. Protect Cash. Think Long Term.
Solomon also recommends trimming everyday expenses, particularly food and utilities.
And surprisingly, he suggests McCann consider taking more investment risk inside his retirement accounts.
His proposed approach: Hold as much as 90% to 100% in equities in long-term retirement investments, while keeping safer assets and accessible cash in the brokerage account.
That strategy isn't appropriate for everyone. But the underlying principle matters: Money needed to survive unemployment should not be exposed to the same risks as money invested for retirement decades away.
5 Money Lessons Every Laid-Off Professional Should Know
Protect yourself first. Don't let a medical emergency destroy years of savings.
Know your runway. Calculate how long your accessible cash can cover essential expenses without a paycheck.
Avoid panic decisions. Major retirement-account changes can trigger costly tax consequences.
Use lower-income years strategically. Tax planning may create opportunities that disappear when your salary rebounds.
Treat cash flow as a priority. A large net worth doesn't automatically mean financial security when income stops.
A High Salary Doesn't Guarantee a Soft Landing.
McCann did many things right. He saved aggressively, invested for retirement, avoided expensive consumer debt, and built substantial wealth.
Yet more than a year without full-time employment has forced him to reconsider everything from insurance to investments.
That's the uncomfortable reality of today's job market: Even highly paid, experienced professionals can face prolonged unemployment.
Your career can recover. Your investments can recover. But a financial disaster without adequate protection may be much harder to recover from.
For anyone recently laid off, the priority isn't just landing the next job.
It's making sure your finances can survive until that offer arrives.