Five things you need to know when your company closes its doors

Unexpected job loss can be traumatic, but there are important steps you can take to regain control. Here are five things you can do when you’ve found out your company is closing its doors. Take advantage of your state’s Department of Workforce Development. They can help you update your resume, search out comparable job offers and find educational opportunities. These transitional times can be perfect for expanding your skill set. Review your insurance options. Make sure you sit down with a human resources representative, take notes, and understand your COBRA options. It’s important to get started on this immediately because, with COBRA, you have 60 days to accept coverage or lose all rights to the benefits. Once you select COBRA coverage, you may have to pay 100 percent of the total insurance cost, plus a two percent processing fee. Because cheaper options might be available to you, it makes sense to sit down with an independent insurance specialist as well to make sure you’re getting the most coverage for your money. Review your 401(k) options. If you want to maintain the tax-deferred benefits of your 401(k) money, you have three choices: leave the money in your old employer’s plan, roll it over into another tax-deferred format like an individual retirement account, or, when you get a new job, transfer it into your new 401(k). IRA rollovers are a good move because they offer more choices and, in most cases, fewer fees than a 401(k). If you do decide to roll over your 401(k) into either a Roth or a traditional retirement account, it is extremely important that you roll it over directly. If you take your 401(k) in a lump sum, your employer will withhold 20 percent for income taxes in case you decide to cash out and keep the money. Generally, you have 60 days to move the money to another tax-deferred account. If you don’t meet that deadline,… | Read More »