Hard to believe it’s already day 20 of this program. How are you holding up? Hanging in there? Just a reminder, if you filed for unemployment this week, it’s not a failure. This moment in time won’t define you. You will recover. Keep following this program and we’ll help you get through.
Today we’re covering changes that may be happening with your workplace benefits. Benefits are the package of options your employer gives you like retirement, health, life, and disability. While this may sting a bit to talk about if you just lost your job, we’ve got to work through what you’ve lost to help you rebuild. Though some of you may be in the furlough camp. The reason you’re hearing the term ‘furlough’ a lot right now is it’s a way for employers to cut costs for payroll but still allow their employees to retain their benefits. Whether you have them through work or not, let’s go through them now to see what you need.
Your account balance has likely changed drastically over the last few weeks but hopefully you don’t know because you aren’t looking. If you’re in your 20s, 30s, or 40s this will just be a blip and your account will recover. If you’re unemployed, you won’t lose your account balance, but it will just sit there with no additional money being added. You can deal with transferring it to another account at a less chaotic time. If you’ve remained employed, it’s possible you’ll see a drop in match contributions from your employer this year or next year. If this happens, it’s likely your employer is simply trying to save jobs by cutting costs. If you can, keep your contributions going. In fact, if you can, increase your contributions. You should be contributing at least 12% of your income under normal circumstances.
Typically when you lose a job you can elect to use COBRA. COBRA is stop-gap insurance for 18 months, but this comes at a great cost. You can also attempt to get insurance via the healthcare.gov marketplace. Losing your job is a qualifying event. While the cost of insurance can be difficult to cover, by all means necessary try to prioritize having healthcare coverage. This is easier said than done, but the likelihood of getting sick is so much higher right now. This is the best way to protect your future finances from unbearable medical bills.
Disability is an under-purchased insurance. You are much more likely to be disabled during your working career than to die. If you have these insurances try to keep up with the payments to the best of your ability. If you’ve been unemployed and lost what coverage you had, prioritize health coverage first.
For more personalized guidance don’t forget that a Hey Money expert is always ready and waiting to help you sort out this mess. Use code ‘cheese’ to get a 10% discount on a monthly subscription just for being a part of the 30 day recession-proof your life program. Stay strong!
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