> Being unemployed for several months is way less scary if your monthly expenses are lower and you have cash in the bank.
I call this being "Dave Ramsey Debt-Free" - and everything you say is true. There's a lot more to it than that (how to properly pay down debt, how to properly use credit cards, buying vs leasing automobiles, plus buy used only, etc) - but the "debt free" part of it is spot on.
The money in the bank? That's f-u money, meaning you get tired of things, tell yer boss to take the job and shove and walk out the door. I've done this a couple of times, and both times it was ultimately worth it, and wasn't scary because I knew I had enough saved that I could keep going at my expenses level for a couple years or more if I had to.
It's a very freeing position to be in.
In a way I suppose I am. My side project is getting a lot more love than it used to, given that my day job is pretty much a straight 40-hour gig that just isn't all that mentally taxing. I'm also taking some MOOC courses, etc.
A few years ago, the single most powerful thing I did was knock out all our non-mortgage debt. It's freeing to know that if something happened, I could take a pay hit of $Xk/month and still have the same lifestyle.
Being unemployed for several months is way less scary if your monthly expenses are lower and you have cash in the bank.