Financial Steps To Take Before Quitting Your Job
Financial Steps To Take Before Quitting Your Job. They’re referring to it as “the Great Resignation” because everyone is quitting their jobs at the same time. At the very least, it appears that everyone is giving up.
The COVID-19 pandemic has caused many of us to reevaluate our lives and our professional paths. Some of us have reached the end of our rope. Some of us have decided that we will never return to the office. It is estimated that about 4 million Americans leave their jobs in June alone, according to the United States Bureau of Labor Statistics.
According to a number of recent surveys, the vast majority of American workers are currently considering quitting their jobs. Some of them are even willing to go into debt in order to accomplish their goals. Are you a passenger in this boat? In the event that you decide to quit your current work without having a new position lined up, you’ll want to make the following five financial actions before you hand in your notice. Possessing a good financial plan will provide you with the time, the space, and the security to pursue the type of profession that you truly desire.
1. Have money saved up in a bank account.
Even if there are many job openings these days, it is possible that you will not find new employment immediately soon. Financial gurus frequently recommend that you have enough savings to cover six months’ worth of living expenses before you leave your job however this can be a difficult task.
In any case, you should have enough savings to last you for several months at the very least. Consider putting a portion of your current paycheck into a separate savings account so that you are less likely to be tempted to spend it. You can earn up to 20 times the average interest rate on your savings amount if you open an Aspiration savings account. (According to the Federal Deposit Insurance Corporation, the typical account earns only.05 percent.)
Your money is safe and secure in this online account, which is insured by the Federal Deposit Insurance Corporation and safeguarded by military-grade encryption. Using your debit card, you can also earn up to 5 percent cashback on your transactions. It takes no more than five minutes to register.
2. Confirm that you’ll have health insurance coverage.
Please keep in mind that we are still in the midst of a global pandemic. Yes, it’s still there. Even though you will no longer be entitled to health insurance as a benefit of your employer, you will want to purchase it on your own.
It is possible to continue coverage under your old employer’s plan for up to 18 months through the COBRA program, but it is prohibitively expensive. If you voluntarily left your employment, you are not eligible for COBRA premiums that are paid by the government.
Instead, consider looking for health insurance through the federal health insurance marketplace, which offers a selection of plans with varying levels of coverage and prices. Depending on your income, you may be eligible for a subsidy to assist you in covering the cost of your insurance.
3. Reduce the amount of money you spend each month.
You’ll have to make do with less money if you don’t have a stable source of income – at least temporarily. For example, you could cut the cable, cancel some streaming services, and avoid ordering takeout for dinner.
Nonetheless, don’t stop there. Take concrete actions to lower your inevitable monthly costs, such as the following:
Auto insurance: A website called Insure.com makes it incredibly simple to compare car insurance quotes from several companies. Simple as entering your ZIP code and age, the system will present you with a list of available possibilities. People have saved an average of $540 per year as a result of this method.
Purchases at the grocery store can earn you gift cards through the use of a free app called Fetch Rewards, which rewards you for purchasing toilet paper and hundreds of other things at the store. You only need to take a picture of your receipt, which must prove that you purchased an item from one of the brands mentioned in Fetch, once you have downloaded the app.
If you make an online purchase, wouldn’t it be wonderful to receive a notification whenever you’re about to be scammed, such as when you’re buying on Amazon or Walmart.com? That’s exactly what this free service accomplishes for you. Simply add it to your browser and, before you complete your purchase, it will check other websites to see if your item is available at a lower price elsewhere.
4. Make a 401(k) rollover (k)
If you’ve been working at your present employment for a long enough period of time that you wish to leave, it’s likely that you have a 401(k) retirement plan via your company.
The temptation to cash it in and have immediate access to all of the money may be strong, but doing so is not a wise option. It carries with it fines and taxes, as well as a reduction in the amount of money you have set aside for retirement. You should generally leave your 401(k) account in its current state until you find a new position. Once you have accumulated enough money, you can transfer it to your next employer’s 401(k). Alternatively, if you plan to be self-employed, you can put the money into an IRA, which stands for an individual retirement account.
5. Identify and develop additional sources of income.
If you’ve been dissatisfied with your current employment and want to make a move, you’re not alone. However, if you left your job without having another lined up, you may need to look for alternative sources of income until you find your next permanent position.
Perhaps it is time to consider taking on temporary side employment to supplement your income. Listed here are seven part-time jobs that have helped us get by over the past year and a half. The services offered by these companies include delivery apps; senior support; contact tracing; freelancing; and homeschool assistance.
We are aware of additional avenues via which we can earn a little extra spending money here and there. For example, some research companies would like to compensate you for your time spent watching the news.
Signing up for a free account with InboxDollars might result in you earning up to $225 each month in extra cash in your pocket. Every day, you’ll be presented with a selection of short news snippets from which to choose, and you’ll be asked a few questions about them. It takes less than a minute to sign up and begin earning money for watching the news broadcasts. Many of us are abandoning our jobs as a result of the “Great Resignation” — or at the very least considering resigning our employment. There’s absolutely nothing wrong with that. A financial plan, on the other hand, will make all the difference if you’re doing this on a regular basis.