6 Tips For Managing Your Finances During A Career Transition

On average, people will change jobs 10 times during their lifetime. Whatever your reason for switching jobs—whether it be a desire for a new career path or the result of a downsizing effort—it can be a stressful time. If you find yourself at a career crossroad, the first thing you can do is take control of your finances. Related: How To Battle Your Financial Nemesis Here are some tips for managing your finances during a career transition...

1. File For Unemployment Benefits Immediately

To qualify for unemployment insurance, your previous employer must confirm that you were laid off. Since each state has different eligibility requirements, you can visit the Department of Labor Web site (www.dol.gov) to obtain information regarding your state.

2. Understand Your Severance Package

Some companies allow you to negotiate a severance package. Make sure you get reimbursed for outstanding vacation days and expenses. See if your stock options have vested in order to sell them.

3. Health Insurance

When you get laid off, your health insurance may end immediately. One option is COBRA, a federal program that allows you to continue group plan coverage. The coverage period for the federal subsidy is nine months and the eligible period for COBRA is 18 months. The recipient must meet certain requirements, for more information and eligibility requirements, please contact the Department of Labor at www.dol.gov.

4. Retirement Accounts

Consider rolling over eligible assets into a new employer’s plan or into an IRA. You need to check with your previous employer regarding eligibility and retirement account options. In addition, you should take into account any potential tax consequences, as well as expenses and sales charges and/or penalties for selling or buying investments before initiating a rollover.

5. Reduce Spending And Avoid Debt

Take a look at your monthly expenses and see here you can cut costs. Contact your credit card company to see if you can reduce or defer your payments. You may have to give up such luxuries as cable TV, cell phone, or entertainment.

6. Take Inventory Of Your Assets

Find out exactly how much you have in stock options, mutual funds, savings accounts, checking accounts and retirement accounts. This will help you find out exactly where you stand financially.

3 Things You Shouldn’t Do

Here are some things you should avoid doing during a career transition:

1. Withdraw From Your 401(k)

Times may be tough, but resist the urge to take money out of your 401(k). You will get hit with income taxes and in some cases a 10% penalty.

2. Rely On A Home Equity Line Of Credit (HELOC)

It will be extremely difficult to obtain a home equity loan while unemployed. But if you already have one, be careful when tapping into it. You could be without a job for a lengthy period of time.

3. Abuse Your Credit Cards

It may be tempting to purchase everything with your credit card, but that can be a mistake. Most credit card companies will raise your interest rates if you miss one payment.

Related Posts

Simple Money Saving Tips For The Unemployed Financing Your Growing Business The Right Way How Investing Can Save Job Seekers Money   Photo Credit: Shutterstock

When most people think of Nike, they think of shoes, retail stores, and, of course, athletes. That's all true, but there's more. Behind Nike's walls, you'll find the doers and thinkers who design, create, and innovate every day. There are also data scientists who discover and leverage athlete insights to create the future of sport.

You might be surprised to learn about the impact you can have in Data & Analytics at Nike versus at a major tech giant. Nike employees get to work on a wide array of challenges, so if you're obsessed with math, science, computers, and/or data, and you love sport, these stories may inspire you to work at Nike.

SHOW MORE Show less

Employee loyalty is something every company longs for. It's estimated employee turnover costs as much as 130-200% of an employee's salary. When a talented, knowledgeable, trained employee leaves, it's bad for business. And, when lots of them leave, it can be the kiss of death.

SHOW MORE Show less

If you saw our first video, you might have heard about the interview situation one of our viewers, Remi submitted. He was in an interview and was asked the question: How many cows are there in Canada right now? - What a weird question but this is a technique that some hiring managers are using these days.

SHOW MORE Show less

If you saw our first video, you might have heard about the awkward situation one of our viewers, Kevin submitted. He is a college student who's working a part time job to make ends meet. The manager/owner of the company has become a micro-manager who watches him work on camera and reads his company emails. A bit over the top wouldn't you say?

SHOW MORE Show less