Navigating Financially

Job transitions can be difficult for a variety of reasons, not the least of which is the financial strain caused by even a temporary loss of steady paychecks. There are some steps you can take immediately, whether you're planning for an imminent layoff or are already without a job.

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When You Anticipate a Job Loss

If you're still working but have reason to believe that may soon change, these tips can help you be financially prepared:

Save some cash – Every penny you put away now will make it easier to adjust to not getting a steady paycheck. See Ways to Increase Cash Flow.
Study your employee benefits – Learn, for example, if your employer-sponsored group disability or life insurance protection is convertible or portable.
Explore your health care options – Don't be caught without coverage if you're suddenly laid off. Can you be added to your spouse's coverage? What are your options for COBRA?
Pay off any outstanding 401(k) loans – Some plans require employees who lose their jobs to pay back the loan immediately. If you can't repay the loan, it may be treated as an early withdrawal with taxes and penalties due. Check with your plan administrator for specific details.
Reduce or stop contributions – Depending on your financial situation, it may be best to temporarily reduce or stop regular contributions to retirement or education accounts in order to increase your remaining paychecks for your savings.
Evaluate your income-tax withholding – Decreasing the withholding on your paycheck can boost your cash flow. Speak with your tax advisor to determine if this is a good option for you.
Consider applying for a home equity line of credit – You may not need to use it, but it's difficult to get approved once you're unemployed.

For more information about managing your finances, contact your Thrivent Financial Representative.

If You Are Already Out of Work

If you've recently found yourself without a job, put these personal finance ideas to work:

Draft a survival budget – Anticipate that you'll be out of work for six months. It's impossible to predict how long your unemployment will last, of course. But you can control what you spend and save. See Ways to Increase Cash Flow.
Make sure you and your dependents have health insurance coverage – It may be least expensive to join your spouse's plan, if that's an option. If not, look into COBRA coverage through your former employer. The 2009 economic stimulus package from the federal government requires that a percentage of COBRA premiums be paid by your previous employer for a period of time. Details are available on the US Department of Labor website.
Examine credit card debt – Contact your credit card company about lowering your interest rate. If you have credit card debt, you may need to make just the minimum payments until you get back to work. If your debt is significant or you are having trouble making even the minimum payments, try to negotiate a payment plan with your creditors.
Take advantage of employer outplacement services – An outplacement firm can help with resume and interview preparation as well as networking, which is an essential aspect of job hunting.
File for unemployment benefits – You have a right to receive benefits you've paid for. Learn more about Unemployment Benefits.
Maintain your life insurance coverage – If you try to resume coverage on a lapsed contract at a later date, you'll pay more and you may have to prove insurability with a medical exam.
Avoid drawing upon retirement funds – Resist the urge to dip into retirement savings except as an absolute last resort. Receiving that money now could mean early withdrawal penalties and taxes you hadn't anticipated. Plus, you'll lose the potential earning power of that money for your eventual retirement.

For more information about managing your finances, contact your Thrivent Financial Representative.

New Job Personal Finance Checklist

Once you've landed that new job – and you will – there are several things to think about. You can take steps now to avoid any financial pitfalls next time you're unemployed:

Save money – If you depleted your savings cushion while job hunting – or you never had a cushion – act immediately to start building up your emergency reserves.
Understand your benefits – Chances are the benefits package at your new job will include things like disability income insurance, flexible spending accounts for health care and dependent care, access to employer-sponsored retirement savings accounts, etc. Take advantage of every perk that you can.
Protect yourself – Your employer-provided insurance coverage may not meet all your needs. Review your life, health and disability income insurance to protect yourself and the people you love.
Manage vested retirement savings – Decide what to do with the vested retirement savings you accumulated in your last job. A financial professional can help you determine appropriate steps to ensure your investment continues to work on your behalf until retirement.
Review your financial goals – Getting ahead requires planning ahead. How does this new position fit in with where you see yourself five or 10 years from now? What money trade-offs might there be? Learn more about IRA Rollovers.

For more information about managing your finances, contact your Thrivent Financial Representative.

What to Know About Unemployment Benefits

Applying for unemployment benefits can be a painful process for a range of reasons. Some tips before applying:

Don't put it off – Depending on your state of residence, there may be a waiting period and it may take time for your claim to be processed. To speed up the process, most states recommend that people file online. Use the U.S. Department of Labor sponsored unemployment benefits map to locate your state agency website including online claims form, details on how to apply, how to file an appeal, and eligibility requirements.
Find out the requirements – To qualify for unemployment, you most likely will need to demonstrate that you're looking for work. Some states require you to visit the unemployment office periodically while others let you contact them online or by phone.
Consider taxes – Unemployment benefits may be taxed. Some states let you have income taxes withheld from the checks, but you may choose to receive the entire amount. When you get back to work, put some money aside to cover income taxes.

For more information about managing your finances, contact your Thrivent Financial Representative.

Ways to Increase Your Cash Flow

There are many ways to increase your cash flow during unemployment, ranging from quick tips to approaches best saved for last resort. Some ideas you may want to consider:

Hold a yard sale.
Use coupons from online sources or the newspaper.
Cancel magazine subscriptions, cable service and auto club memberships.
Donate blood plasma for a fee.
Sell unwanted items via online sales sites such as eBay.
Get a part-time or temporary job.
Review deductibles on auto and homeowner's insurance.
Combine phone, Internet and cable service.
Get a renter or roommate to cut expenses.

Help with the Cost of Prescriptions

Are you without health insurance prescription drug coverage?
Depending on your situation, you may benefit from a Thrivent Financial for Lutherans complimentary benefit of membership – the Express Access prescription drug discount program.

Your Financial Representative Can Help

Your financial representative is always available to help. Whether it's regarding your employer-sponsored retirement plan, your options for health insurance coverage, how to manage a survival budget or how to prioritize your current bills, contact your financial representative for assistance.

Thrivent Financial for Lutherans and its respective associates and employees cannot provide legal, accounting or tax advice or services. As appropriate, work with your attorney and/or tax professionals for additional information.

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