We are back with some You-Only AdviceTM in our current Life Series. This month we are looking at financial steps when starting a new job. Starting a new job is exciting and full of potential. Whether you are beginning your career, transitioning positions for growth and opportunity, or pivoting to a new career, the following financial steps will have you starting on the right foot:
1. Tie up loose ends.
Before leaving your currently employer, connect with human resources to ensure that you are leaving with all the benefits you have earned. If you have a 401(k), ask for the paperwork necessary to roll the balance over to your retirement account with your new employer. If there are benefits that will not leave with you, like vacation time or the balance in your flexible spending account, understand how you can use them before leaving.
2. Understand employee benefits offered.
Companies offer a wide host of benefits to employees. Read through the employee handbook to understand the nuts and bolts of what is offered and what is required of the employee to take advantage of the benefits. Example: you want to go back to school, and your new company offers tuition reimbursement. A key feature listed in the employee handbook – your company reimburses based on a grade scale (100% for an A, 80% for a B, $0 for grades below a B).
3. Health and Life Insurance.
Although health and life insurances are employee benefits, they deserve their own point. Starting a new job counts as a life event that triggers āopen enrollmentā. Before enrolling in a health insurance plan, consider copays, deductibles, and network options for each plan. Do you or eligible family members have medical needs that requires a higher level of coverage? Matching the health care policy that matches your needs and budget can be challenging but is doable.
4. Make the most of retirement matching.
Employee funded retirement accounts are replacing employer-funded pensions. To stay competitive, employers offer a match incentive matching contributions employees make into their retirement accounts. To save the most for retirement, contribute up to the maximum amount matched by your new employer. For example, if your company will match up to 5% of contributions you make, be sure to contribute 5% to get the full benefit.
5. Think through changes in expenses for your new job.
Consider changes created by your new role. Will you have a longer commute? Does your new employer have a strict dress code requiring you to purchase a new wardrobe? Will you need to pay for parking? Factor new expenses into your budget and make adjustments if necessary.
No matter the changes life brings, we are here for you. We can help with all the components mentioned above, offering guidance when you need it. While a new job can be exciting and full of potential, it can also be a time of upheaval. The steps above can help make the landing into a new job as smooth as possible.
There are times in life when the job is not the right fit any more and you feel a nudge toward the door, and that is okay. Next on the LIFE series, we will cover the loss of a job, leaving a job, and touch on the possibility of retirement being the right next step.