How to Prepare for a Potential Layoff

February 22, 2023

I recently spoke to a friend who was scared of getting laid off. She asked me how she could prepare for a layoff. The following was the guidance I gave her:

 

Stop paying extra on debts and start stockpiling cash.

 

I know this may sound counter-intuitive to many people, but if you are facing a layoff, you need as much cash to live on as possible while you look for work, especially if you have less than three months of expenses saved. Consider paying your credit card debt minimum and funneling as much cash as possible to a savings account. Also, consider earmarking any tax refunds to savings.

 

Review the budget and trim the fat.

 

This fat can be a cable or cell phone package with all the bells and whistles. You can ask for a cheaper cable plan or cut the cable cord altogether. You can choose a more affordable cell phone carrier or cancel a rarely-used subscription.

 

Contact creditors in advance to let them know of a potential layoff.

 

If you talk to your creditors before there is a problem, they can be more willing to work with you. Then, take full advantage of your potential layoff and ask your creditors for a reduced interest rate.

 

Review workplace benefits.

 

If you have accrued vacation or sick leave, ask if your company will pay you for unused time if you leave involuntarily. Have you had your annual checkup or been putting off dental work? Now is the time to take care of all your medical needs. See which benefits such as life insurance, long-term care insurance, and even some legal benefits are portable, meaning you can continue them after you separate from service.

If you have outstanding 401(k) plan loans, ask your plan provider how they handle loans during a layoff. Some companies will give you a short period to pay it back, and then the remaining balance counts as taxable income with a potential 10% penalty if you are under 59 ½. Other companies allow you to continue to pay your loan balance from your checking or savings account. In addition, medical saving plans such as HSAs can go with you, and you can use the funds for healthcare premiums while receiving unemployment benefits.

 

The key is to prepare in advance. If you are laid off, you have done the legwork to be financially prepared. If the layoff does not happen, you have built up savings and are in a great position to start re-attacking debt.

 

Are You Leaving Money On The Table?

November 13, 2015

One of the things that I have heard people say in conversations regarding money is “every dollar counts” and…I agree with that. To that end, there is some money that a lot of employees leave on the table on a fairly regular basis. With just a few slight tweaks, they could recover some out-of-pocket expenses that far too often are being put on a credit card and creating a gradual increase in debt level. The best part is that these are all 100% above board and employer-sanctioned. We all work hard, and in the course of doing that work, you should be able to recover some of the expenses of working. Continue reading “Are You Leaving Money On The Table?”

The Best Place To Find Financial Products And Services

November 10, 2015

My cousin is the ultimate bargain hunter. If you are looking for that amazing combination of value and quality, she is your woman. She can find the $5,000 vacation for $1,000 or the $500 coat for $69.99. She came to me excited because she found an amazing deal on life insurance. She has been searching for months with no luck and finally went to a financial advisor who gave her the cheapest quote she had gotten so far. Continue reading “The Best Place To Find Financial Products And Services”

Are You Ready For Open Enrollment?

October 27, 2015

It’s open enrollment time…that time of the year when you get this huge booklet or email of benefits and have to wade through all of the papers and links to figure out what to do while planning for the holidays at the same time. Remember to take time to really think about how you used your benefits last year so you can make the best decision. Here are a few things to consider: Continue reading “Are You Ready For Open Enrollment?”

Take Advantage Of Your EAP

September 29, 2015

As I talk to people about their finances, I find that many need guidance for the everyday issues like daycare, eldercare, and legal or financial issues to get them on the right track. My guidance is always to research your company benefits to take full advantage of everything your company has to offer to help you financially. I find that one of the most underutilized benefits is the employee assistance program. Continue reading “Take Advantage Of Your EAP”

The Value of Your EAP Program

June 09, 2015

Years ago when I was pregnant, I was a nervous wreck. I did what every pregnant woman should not do. I found every article I could on every worse-case scenario imaginable about daycare. Continue reading “The Value of Your EAP Program”

Don’t Leave Any Money On The Table

June 02, 2015

A few days ago, I was meeting with a friend that just changed jobs. She was excited about the pay, her new co-workers and the shorter commute to work. As she started talking, I mentioned that she should take advantage of all the benefits her company offers and not leave any extra money on the table. Continue reading “Don’t Leave Any Money On The Table”

My $280 Mistake

February 05, 2015

I admit it. I goofed. Despite being a financial planner who often helps people with their benefits, I made a mistake with my own. As I was looking at my expenses and taxes for last year, I realized that I could have reduced my taxes by $230. That’s the amount I would have saved if I contributed the $817 I spent on eligible vision and dental expenses last year to my company’s limited-purpose FSA (flexible spending account). Continue reading “My $280 Mistake”

Your Best Financial Services Provider Might Be Your Employer

February 03, 2015

It always amazes me how people overlook their employee benefits and will pay out-of-pocket for what they can in some cases, get for free. Years ago, I worked with a couple in which the wife was diagnosed with breast cancer about 5 years ago but thankfully, is in remission. They were trying to get their estate plan in order and had hired their friend’s attorney to help them. Several thousand dollars later, they wondered if they made the right choice. Since I am not an attorney, I would never give legal advice, but I had to admit to them that considering the simplicity of their estate and wishes, they had an amazingly complex plan. Continue reading “Your Best Financial Services Provider Might Be Your Employer”

10 Financial Lessons From the Celebrity Apprentice

May 16, 2013

While I don’t generally watch tv or even own one, I have to admit that I’m a huge fan of one particular show: The Apprentice, which is currently on the verge of the finale of its All-Star Celebrity Season. While the show has its share of mindless reality tv entertainment, there are lessons that can be derived from it, not just for the business world that the show is based on (albeit loosely) but for our own personal financial lives as well. Here are some financial lessons from this season’s celebrity firings: Continue reading “10 Financial Lessons From the Celebrity Apprentice”

Does the 401(k) “Suck?”

May 09, 2013

A friend of mine recently sent me an article titled “It’s a 401(k) World and It Sucks.” I realize that the 401(k) is not perfect (but what is?) and the author does make some good points. But that being said, “sucks” is a pretty strong word about the vehicle that has encouraged more retirement saving than anything else, especially considering how much we need to increase those retirement savings. Let’s take a look at each of the author’s main arguments: Continue reading “Does the 401(k) “Suck?””

5 Unromantic Reasons to “Put a Ring On It”

November 08, 2012

I’m amazed at how often I speak to people who have lived with a significant other for many years and even have children together but haven’t tied the knot. Now, I’m not trying to make a religious or moral argument for marriage. In fact, I’m a bachelor myself. Rather, I think it’s important for these couples to understand the various financial implications of “living in sin.” Continue reading “5 Unromantic Reasons to “Put a Ring On It””