How to Handle Finances When Quitting a Job

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You are at the end of your rope. Your current job is a dead end. You see little chance for advancement, just a continual stretch of routine tasks stretching as far as the eye can see. It’s time to look for something new.

The conventional wisdom will tell you that you shouldn’t leave your current job until you have found a new one. But, for one reason or another, that is an option that is not open to you. It could be, for example, that you would like to move to a new location, and job hunting long distance really hasn’t been working out. Or there may be personal reasons and other obligations getting in the way.

So, you realize that you are going to have to quit your current job before finding another. If you find yourself in this situation, you need to get prepared financially. And that means more than just cutting back on the double espressos at Starbucks. Here are a few tips.

1. Have a rainy day fund.

In other words, you need to have savings in the bank. Most experts recommend at least the equivalent of about three months salary before you even think about leaving. And, considering that it is likely to take more than three months to find a job, you may want to have even more stashed away. Plus, you can count on unforeseen expenses during your job hunting, so you need to be prepared for that.
You may have to make some lifestyle adjustments to put that money away, but that is just the sacrifice you will need to make.

2. Figure out what to do with your retirement account.

If you have a retirement account at work, a 401(k), for example, you will need to determine what you are going to do with it. Some places will allow you to keep the money in the account even after you leave, but you need to find out if that is the case. Otherwise, you may have to roll the funds over into another retirement account, such as an IRA (Individual Retirement Account).

3. Take care of some expenses now and don’t plan on incurring any new ones in the near future.

If you just bought some new furniture or a TV or refrigerator, try to pay it off before you leave your job. You don’t want to have that expense hanging over your head while you are looking for work.

4. Get health insurance.

You can go the COBRA route, but that can be expensive. Fortunately, you have the Affordable Care Act to fall back on and can get subsidized health insurance on the federal or state exchanges.

If you are looking for work in the San Antonio area, Trinity Staffing can help you find the job that fits your particular skills and personality. We have earned a reputation as one of the best staffing agencies in the San Antonio area. Give us a call today.