Graduated Learning: Life after College

I got my degree, I got a job…now what?

Layoff Survival Guide: Back to work! September 20, 2009

Filed under: Careers,Personal Finance — Stephanie @ 3:32 pm
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So, let’s say you’ve gotten a job offer.  Congratulations!  But now you may be wondering what to do about all those changes you had to deal with when you got laid off.  What do you do about your health insurance coverage now?  And how do you stop collecting unemployment?  What are all the things you have to deal with when you’re starting a new job?

A friend of mine asked me to write about this subject.  Well, one friend complained that my Layoff Survival Guide was too depressing, so my other friend (who is still looking for a new job) suggested this would be a happy twist to the posts.

So, with my first post, I talked about 401(k)s.  At your new job, you’ll likely be given the option to enroll in their 401(k) program (or similar program for non-profits, government jobs, and the like).  Sometimes you’ll have to wait to enroll, or wait for them to match or somehow contribute to your account.  I recommend signing up for a 401(k).  If they provide a matching contribution, I would strongly encourage you to sign up.  There are usually a few different options for funds you can invest in.  Don’t let that part intimidate you!  If you’re not sure, there’s often someone you can call at  the company running your 401(k) (or even in you HR department)  that can give you some general guidance.  And while I’m not a certified financial adviser, I would suggest you look into a “life cycle fund”, one that invests in funds that are more aggressive if you’re not retiring for many decades, and become more conservative as you get closer to retirement.  That’s what I’m doing with my IRAs.  For my 401(k), I’ve tried to make a diversified portfolio with assorted styles of funds, and only looking at the funds with low or no expense ratio.

Next I told you about COBRA and transitioning your healthcare coverage.  Now that you’re at a new job, you’ll likely have access to a discounted (or free) health insurance program (depending on what your company offers).  If the new insurance available is, in your opinion, better (cost-wise, or cover-wise, or other factors important to you) than what you’d been on while unemployed, you should sign up!  Confirm that your new health insurance is officially started, then get in touch with your former company’s HR person in charge of health insurance, and/or your previous insurance company, and let them know that you’re on a new plan.

Finally, I discussed collecting unemployment.  At least for me, in Massachusetts, I didn’t have to call to cancel.  I just stopped filing claims.  Hopefully, that’s what I was supposed to do!  I had asked a friend what she did when she got a new job, and she said she did the same thing.  It may differ from state to state, so check in with your state’s Office of Labor to confirm.

Hopefully this has given you a good idea of what you can look forward to once you get a new job.  As always, feel free to comment or email me if you have any questions.

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Layoff Survival Guide: Collecting unemployment June 28, 2009

Filed under: Careers,Personal Finance — Stephanie @ 7:41 pm
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These days, a lot of people are getting laid off.  And one thing you should take care of is filing for unemployment benefits.  Eligibility requirements and compensation amounts vary from state to state, so you should go to the site for your state to find out if you’re eligible and how to apply.  You can find information for any state here (found via this Department of Labor page).

One thing that originally confused me was that in many states, they call it Unemployment Insurance.  I guess they call it that because companies pay into it and then when someone loses a job, they are able to collect money.  Still, this isn’t quite “free” money; you have to pay income taxes on it, just like any other income.  Luckily, another tax perk of the American Recovery and Reinvestment Act is that “the first $2,400 of unemployment benefits an individual receives in 2009 are tax free“.  That’s a pretty nice deal!

From experience, I know that filing a claim can be a bit of a hassle, especially since, in most cases, you either have to go to an Unemployment office or call…and these days with so many people filing, you’re in for a wait.  Luckily, once I filed, I was able to submit my weekly claims online.  For the weekly claims, I had to assert that I had indeed been looking for work.  I was supposed to keep track of my job search (which is a good idea anyway) in case they wanted proof, and I had to let them know that I was willing and able to work, and if I earned any wages that week (due to part time jobs).  I think you’re still allowed to earn wages, it just lowers the amount of unemployment benefits you receive for that week.  And once I got a job offer, I stopped filing claims.

So, go ahead and file!  When I first got laid off, I felt weird about collecting unemployment, but realized that, really, that’s what the money’s there for!  Your (former) employer has to pay into this fund, you might as well take advantage of it!

As usual, let me know if you have any other questions related to surviving unemployment, or if you have any insight on this topic.  I’m here to help!

 

Layoff Survival Guide: What to do with your 401(k) June 19, 2009

Filed under: Careers,Personal Finance — Stephanie @ 8:06 pm
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A good friend of mine recently got laid off.  And, since I went through this about a year ago, I’ve got plenty of advice. 😛

I’ve decided to start a little series, the Layoff Survival Guide.  I’ll be answering questions that she has, and will be more than happy to answer any questions you have.  I’m not a professional financial adviser or career coach, but I’ve learned a lot about surviving a layoff, and the transitions and decisions that come with it.  Plus I might have some advice on finding a new job.  I already have a few posts for some of these topics (linked to in previous sentence), but I don’t mind focusing on a specific question or topic.

So, ask away!  I’ll try my best to find the information you are looking for!

One of the questions my friend sent me was:  What do I do with my 401(k)?

I realize that  plenty of people have posted about what to do with your 401(k) after you leave your job (either voluntarily or involuntarily).  A really good guest post by The Working Dollar at  Get Rich Slowly describing  your options can be found here.

Still, here’s my own view of your options:

Keep your money where it is.  This isn’t the option for everyone.  In fact, it depends on the rules of your company and the firm they run the 401(k) through.  There’s usually a certain amount of money you need to have in the account in order to keep it there.  If you’re happy with your portfolio there, and you are allowed to keep your money there, then you can go ahead and keep it around.  If you aren’t able to keep your money there, or you don’t like how your money is invested, or if they’ll start charging a fee or impose other rules you’re not comfortable with, then you might want to consider the other options.  The benefit to keeping it (if you can) would be that you wouldn’t have to “sell” your funds, and could hope to make back the losses from the crummy stock market performance.  When my boyfriend left his last job, he just kept all his investments at the old company, since he actually had really good investment options there, whereas I was not happy with my options after I got laid off, so I rolled my 401(k) over.

Roll over to an IRA (or Roth IRA).  If you can’t (or don’t want to) keep your money where it is, you can roll it over to an IRA.  Most investment companies (like Fidelity, Vanguard, or T. Rowe Price) (click those to go directly to their rollover sites) have an option to roll your money over from your 401(k) into an IRA.  The important thing to remember here is that you should check with both the organization that has your old 401(k) and the company that you want to roll over your money with, to see how you can move the money without incurring fees or taxes.  They’ll tell you what to do!  You can now also roll over your money into a Roth IRA, but will need to deal with the taxes there (pre-tax money to post-tax money).  The benefit of having an IRA is that you have more choices on what to do with your money.  It’s an investment vehicle, where you can buy all sorts of different investments…not just the 10 or so mutual funds that your company lists for you.  Another good post about IRAs (from Get Rich Slowly) can be found here.

You also have the option to Roll over your old 401(k) into a new employer sponsored plan.  I don’t know as much about this option, but it seems that it would require you to have your new job already.  You’d need to be able to keep your retirement savings somewhere (i.e. the old 401(k)) while you wait for your new plan to take effect.

And, finally, my least favorite option, Cash it out.  I don’t recommend this unless you have a really good reason to.  You’ll be hit with taxes all at once, and will likely have to face fees as well, quickly dwindling down the actual amount you will get.

What did I do?  Since I was not happy with my investments in my old 401(k), I decided to roll my money over to an IRA.  And since I already had a Roth IRA at Fidelity, I decided to open a rollover IRA there.  It was pretty darn easy, and they answered all the questions and concerns I had.  Plus they have a lot of investment options, many of which don’t require fees.  I’ve heard good things of lots of the other investment companies, so take a look around your options before committing to a specific company.

Vanguard also lays out the pros and cons of each option (as does Fidelity).  Like I said before, this information is everywhere.  But I just figured I’d lay it out again for anyone looking for some guidance.

Have any questions about what I wrote?  Suggestions?  Corrections?  I don’t claim to be a financial adviser or expert, so hopefully you’ll take what I’ve written and run with it (and if there are mistakes, I’ll be sure to edit it to reflect corrections you submit).

Also, what other questions do you have about the transition from employment to unemployment?  I’ll be answering them here!  Leave a comment or email me the question at graduatedlearning@gmail.com.

 

I got laid off…now what? May 6, 2008

Yep, you read it here first folks. I got laid off. Thank that beautiful economy of ours, I guess. But now that I’m unemployed, what do I do?

Be thankful for the emergency fund

Remember that emergency fund that every personal finance guru, blogger, author, etc. tells you about? You’ll be very relieved when you find out you have that nice cushion to fall back on. And really, that whole “pay yourself first” idea really works. I never noticed the money was gone (every month I had an automatic transfer over to my ING account), and now that I need it, it’s sitting there waiting for me to draw from when I need to.

Take care of the transitions

Depending on what your severance package provides (or if you didn’t get one at all), you’ll probably look at a few things. Did you get any severance pay? Congratulations. Stash that into your bank account ASAP, and be thankful that your company was nice enough to help you out there. My company did provide some severance pay, but a friend of mine got laid off recently and got pretty much next to nothing. It’s really dependent on your company.

What are you going to do about insurance? Again, some of this depends on your company; they may immediately stop paying the premiums for your insurance, or provide you a grace period. Either way, you should learn about the COBRA. This is where you are given the opportunitiy to continue your insurance plan, but you must pay the premiums, at up to 102% of the cost. Many people can just find alternate, often cheaper plans that still cover their needs. Depending on your state, you might be required to have insurance (which is the case in Massachusetts). From what I’ve heard, if you don’t elect to continue through COBRA, but then something happens and you need insurance, you can retroactively get it taken care of. Don’t quote me on that, I’m looking into it.

Were you enrolled in a 401(k) or similar program? If so, you have a few options that I know of. They are summarized rather nicely in Get Rich Slowly’s page. I am most likely going to either roll my 401(k) over into an IRA, or, if I find new work soon enough and it’s a feasibility, I will move my 401(k) to my new company’s 401(k). What I will NOT do, and I don’t recommend you do it either, is cash out my 401(k). You have to pay a penalty, and taxes right then for your money, and now you are back to square one with your retirement planning.

And if you had an FSA account (I did), you’re probably going to have to just submit the rest of your claims ASAP, and lose any money that you didn’t spend. I guess this wasn’t something I considered when I initially signed up, but I guess that’s something to think about…how quickly you’ll spend the money in your account. I’m not sure what happens if you spent more than you accumulated, if you have to pay back the extra. I’ll have to check on that as well (for you guys, not for me).

Looking ahead

It’s rough, but it’s time to get back out there! Let your friends know that you are looking. I went ahead and listed it on my facebook profile…which worked out nicely, because a friend saw that and offered to talk to someone in his company that works in my desired area of research. Having good friends willing to help you out is definitely a plus. This is not the time to start networking with people you’ve casually met in the past…hopefully you’ve been networking all along…of course, if you haven’t, you might as well start now! It just looks a little fishy when you suddenly talk to someone you sort of know who can help you find a job. But don’t be afraid to. Update your profiles on your social/business networking sites, and confirm that the available information and connections is accurate and represents you in a positive light. My next step is to look at companies that interest me, and then determine if I have a personal connection to that company, either through friends or through my alumni network.

In the meantime, I’ve also started looking at the assorted job posting sites out there, like monster.com and career builder. There are plenty of others that I’m looking at, and if you want, I can post those, too, though I’m not sure how popular of a site they all are.

Well, hopefully you aren’t all in the same boat as me. Let me know what you’ve found helpful, or if you’re looking for information that I didn’t include, since I probably just omitted it for no useful reason.

[Edit: I forgot to mention applying for unemployment. There’s a good overview here, and for Massachusetts, you can find out how to file claims and such here. If you have trouble navigating that site, let me know. I managed to figure it out.]