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▸ SOP · Scenarios · Runway Zero

Runway Zero After a Corporate Layoff

Mid-level engineer, 12 weeks severance, 6 months UI — how long does the math actually hold?

Recompute runway with and without unemployment insurance and mark the 90-day hand-off where severance ends.

Subject: 38-year-old mid-level software engineer, laid off in a 12% workforce cut. Severance: 12 weeks at $6,000 net/mo ($18,000 total). Unemployment: approved at $2,400/mo for 6 months. Emergency fund: $22,000. Monthly burn: $4,100. Runway reading: runway unset.

▸ Deterministic Formula
cash_available = severance_total + emergency_fund
net_burn_with_UI = monthly_burn − UI_monthly
runway_no_UI = cash_available / monthly_burn
runway_with_UI = (severance_months) + (fund / net_burn_with_UI)
cliff_date = today + severance_weeks
▸ Logical Gates
  1. Confirm severance schedule (lump sum vs payroll continuation) and UI determination letter.
  2. Compute runway both with and without UI. The gap is the UI-extension value.
  3. Mark cliff_date = severance_weeks from today. Calendar the recompute.
  4. If runway_no_UI below 6 months, begin bill triage now, not at the cliff.
  5. At runway runway unset, apply threshold band to decide offer acceptance aperture.

Quick answer

Recompute runway with and without unemployment insurance and mark the 90-day hand-off where severance ends.

What you are trying to do
Mid-level engineer, 12 weeks severance, 6 months UI — how long does the math actually hold?
Best next step
Runway Zero
Limit to remember
Treat this as a practical aid for the task, not a replacement for professional judgment.

▸ Key Specs

  • ▸ Severance is finite cash — add it to the numerator. UI is monthly income — subtract it from the burn denominator.
  • ▸ Week 12 is the cliff. Severance stops, UI continues — recompute runway the day severance ends.
  • ▸ Current reading: runway unset. Below 6 months triggers the cash pivot before the severance cliff, not after.
  • ▸ Do not count UI past its 26-week cap. Treat month 7 onward as emergency fund only.
  • ▸ Every week of delayed offer acceptance = one week of fund drain. Measure offers against the fund curve, not ego.

▸ Worked Examples

  • Runway WITHOUT UI (worst case)
    Cash available = $18,000 severance + $22,000 fund = $40,000. Burn = $4,100/mo. Runway = 40000 / 4100 = 9.76 months. Severance covers weeks 1-12; fund covers the rest.
  • Runway WITH UI folded into burn
    Net burn = $4,100 − $2,400 = $1,700/mo during UI eligibility. Months 1-3 (severance + UI): fund untouched. Months 4-6: fund drains at $1,700/mo = $5,100. Months 7+: fund drains at $4,100/mo from remaining $16,900 = 4.1 months. Total: 10.1 months.
  • The 90-day decision
    At day 90, severance ends. If no offer signed, the burn rate jumps from net-zero to $1,700/mo. Pre-commit the cash pivot (downgrade COBRA, pause 401k match replacement, freeze subscriptions) before the cliff, not after.

When to use which tool

▸ Operational Thresholds
  • CYAN · STABLE — Runway above 9 months with UI counted — negotiate, interview selectively, protect fund.
  • GOLD · GUARDED — Runway 4–9 months — widen offer aperture, cut two largest discretionary line items.
  • MAGENTA · CRITICAL — Runway below 4 months — accept next viable offer, trigger bill triage, stop fund bleed.
▸ READ NEXT
Shock Survival →
Baseline survival efficiency against the new burn number.

Related

Frequently asked questions

› Should I delay filing UI to save benefit weeks? Trust & accuracy

No. File the week you are separated. Benefit weeks are calendar-bounded; delaying filing burns them. Severance reduces weekly UI in some states — check the offset rule before deciding, but always file.

› Does severance count as income for UI?

State-dependent. Roughly half of US states count lump-sum severance as wages and delay UI start. Half treat it as post-separation pay and allow immediate UI. Read the determination letter, then rerun the math.

› When do I accept a below-market offer? How-to

When fund runway without UI drops below 3 months. Above that, negotiate. Below it, the math stops being about comp and starts being about cliff avoidance.

› How should I use this guide with a Kefiw tool? How-to

Use the guide as the plan and the linked Kefiw tool as the check. Read the steps first, try the move manually, then use the tool to compare outputs, catch edge cases, and decide whether the result actually fits your task.

› What mistake do tool guides help avoid? Troubleshooting

Tool guides help avoid using a utility mechanically without understanding what you are trying to accomplish. Most word, writing, and text utilities are fast, but speed can hide context mistakes. Know whether you are solving a puzzle, cleaning copy, drafting a line, or checking a rule.