We've talked before about how an investor doesn't want too much (I've read 5% to 10% at most) of his portfolio tied up in his company's stock. The rationale goes that he's already tied heavily to the fate of the company since that's where he's employed (and if the company tanks, so could his job and salary) and to add too much more to the dependence on one entity is really too risky. If you don't believe in this line of thinking, ask people who used to be at Enron and had all their retirement savings in the company stock. They lost their jobs AND all their retirement -- a true double whammy.
And now here's a related situation that seems like a bad one to me: both spouses working for the same company. I won't comment on the "we see too much of each other" and related social issues that could be associated with this sort of thing, but just think about the impact to the family (and the risk to income) when a husband and wife both work for the same employer, especially in this economy. For instance, think about a couple that both work for GM, Chrysler, or AIG. They're probably not doing too well now.
Then again, is having both spouses work for one company any worse than having a single-earner household? Probably not. But it's not as good as having each spouse employed by a different firm so the potential risk to income is spread out a bit.
This whole line of thinking was brought to mind by friends of ours who work for the same company. The business is doing "ok", but not great, and they could be at risk (a really big risk) if things turn just a bit south. It's got to be tough for them.
So what do you think? Is both spouses working for the same employer a financial issue or is there really nothing to worry about?
Well, if they're in the same department, doing very similar jobs, that could be an issue. Different departments? Maybe not.
We have couples who work for the same company, and sometimes, in the same building. The company rule is that no couples can work in the same department. Even in different couples, I suspect the situation isn't ideal, but... they do what they have to do I guess.
Posted by: Eugene Krabs | June 25, 2009 at 11:32 AM
My fiancee and I work for the same company, but in different areas. We work for one of the Big 4 account firms (her in audit, me in tax) and after me going through the Andersen meltdown you would think we would have reason to be concerned but we are not. The fact that I am looking for another job outside of the company probably accounts for most of that lack of concern. The fact that we live on one salary and save the other accounts for the rest. Prior to this downturn we would have never of thought twice about one or both of us losing our job, but with the layoffs that have been taking place over the past 6-9 months it has proven that we should at least be aware. I doubt we will ever work for the same company again once I leave because it is truly not the ideal situation when you think of what has gone on in the past with Enron, Andersen, AIG, et al. It is bound to happen again so we might as well not take the risk.
As for the social aspect of it all, we never see each other at work so we have never thought twice about that aspect.
Posted by: Andy | June 25, 2009 at 11:52 AM
As someone who is trying to get their spouse hired at their work (doing the same line of work)I don't see too much of an issue. But I think it is because of my particular situation. If you have a job wher eyou could be relocated it is beneficial to have your spouse work at the same company. They can then transfer you at the same time so no loss of income is incurred during the move. I guess this is a special situation though.
Posted by: Angie | June 25, 2009 at 12:02 PM
My husband and I used to work for the same company. We did both get laid off and we both got nice severance packages. The time each of us was home only overlapped by about 4 months. Between severance, unemployment and our emergency fund, we did okay.
With the work I do, I can always find SOMEPLACE to go and work even part-time if needed, so we were never really too concerned.
You do have to think about what you would do if you lose both salaries AND your medical coverage though.
Posted by: SUSAN FROM LI | June 25, 2009 at 12:04 PM
I must also admit I am currently putting all of my 401k money in the company stock. Bad idea for the long run definitely. But in the short term there is a lot to grow I think.
Posted by: Angie | June 25, 2009 at 12:05 PM
Completely unrelated, http://en.wikipedia.org/wiki/Work_spouse For lols and giggles.
Posted by: A_Muslim | June 25, 2009 at 12:56 PM
It seems like a lot of these responses are dancing around the true nature of this question. The question is whether or not it is A GOOD IDEA in general for spouses to work at the same company. Even though some of you who have already responded have not had issues working together, even the safest of jobs are now in jeopardy in our current economy. How many times have we all heard the nightly news' lead story be something like: "XYZ Company just announced that they are going to be cutting 1,000 jobs"?
We are taught from day one to diversity our portfolios to minimize risk. Your employment is part of your portfolio....Diversify!
Could you be successful working together? Absolutely. Are you running a higher risk in having both incomes elimintated due to cutbacks/layoffs? Absolutely.
Posted by: Marc B. | June 25, 2009 at 01:16 PM
I agree that both spouses working at the same company is risky. I say that as someone who works at the same place as her spouse (until recently, in different divisions/departments). For us, it's a risk we're willing to take. Being DINKs definitely helps.
Fortunately for us, I don't think there is too much risk with the company as a whole (it's similar to working for the government). However, different divisions can be at risk at any time. In fact, that's why hubby and I currently work in the same division. Things were looking iffy in my division so I transferred to his (where there's more business than they know what to do with).
Posted by: savvy | June 25, 2009 at 01:45 PM
I think it depends on the company. Both spouses working for a start-up company, or for a company that's losing a ton of money, or a company that's in an extremely volatile industry, or in roles where the compensation is almost entirely variable - those are risky scenarios.
Barring those, I don't think it's that big of a deal.
Posted by: Bad_Brad | June 25, 2009 at 02:49 PM
I think that from a strictly fiscal and analytical point of view, having both spouses work at the same company is certainly risky.
However... what do you do if you fall in love and get married with someone who happens to have a very similar, niche skill set in an admittedly small work sector?
My husband and I work together. We are both engineers in the aerospace industry. We have always worked together. Jobs in the aerospace sector tend to be clumped in localized areas, and the things we specialize in are similar enough to support us working together - often in the same department, and even on more often on the same project (gotta love "matrix" assignments).
We have worked for the government, and now we work for a small, highly specialized company. We purposefully left the government and took pay cuts (gasp) to continue to do what we enjoy doing and are good at.
Sure, it's a risk, and we are more than aware of that - we both find this to be a financial risk, but one we are currently not inclined to change. To compensate, have a sizable emergency fund, we both have side interests, and if one or both of us looses our job, I feel that even in this economy we could afford to move ourselves to wherever we could find new work.
Generically speaking, I think the biggest financial risk any person or family can make is not thinking through risks and having contingency plans in place. And again, I will acknowledge that having all the income for a family come from the same source would be higher risk - so plan accordingly.
Posted by: Jetgirl | June 25, 2009 at 03:08 PM
I love the last comment: have a backup plan. Even if you're employed at different firms, isn't it a good idea to have a plan in case you lose your job? Another firm where you could go? A network in place?
Posted by: F | June 25, 2009 at 03:28 PM
My DH and I work in the same industry ..at the same company but in different departments. We're both in one of those specialty fields ... which means one of us would have to give up a career and switch to another industry to minimize the risk.
We've sweated through a couple of layoffs so far, and at the moment, we're both still employed. Ironically, a couple colleagues who were laid off were the sole support of their families -- their spouses, who worked in other fields, had been laid off earlier.
Posted by: DW | June 25, 2009 at 05:31 PM
Ideally for "diversification" it would be best if each spouse worked in a different industry & a different profession.
Posted by: shadox | June 25, 2009 at 11:31 PM
To carry it a step farther, it's also "risky" when both spouses are in the same line of work in general. It's not that hugh of a risk in some cases, but if both spouses are attorneys or doctors or work in a cyclical industry like real estate then it's certainly not going to lesson volatility in the financial partnership when it comes to income and expenses.
Posted by: Meg | June 26, 2009 at 02:57 PM
bad idea. my wife and i both worked for the same company and both lost our jobs within 6 months of each other (this was 2005). both of us worked in different departments in different parts of town and it almost killed us financially. but we didn't learn. our next jobs where for the same company also (but it kinda worked out I left on my own and my wife is still employed with them...).
Posted by: Clay | June 30, 2009 at 01:25 AM