How to Prep Financially When Changing Jobs
Special to The Truth
The average American will
hold 11.7 jobs between the ages of 18 and 48, according to
The Bureau of Labor Statistics. If a job change is on your
horizon, remember that a new salary and benefits package
bring new financial considerations.
“Changing jobs brings with
it a myriad of financial decisions. Take time to assess your
financial situation and make any necessary adjustments so
you can start the new job focused and ready,” says Valerie
Radford, a vice president of Strategic Initiatives at
Prudential Financial.
As you’re making the
switch, Radford says there are a few things to keep in mind:
• Don’t Leave Money on the
Table: Keep track of your 401(k) if you had one at your
previous job. You can simplify your financial picture by
bringing together any orphan plans you’ve left in the
investing universe. Also, make sure to take advantage of
your new employer’s 401(k) match feature, if offered, and
continue momentum by increasing your contribution, if
possible.
• Don’t Go It Alone:
Consider using a third-party platform to manage finances and
benefits in one place that’s designed to rebalance your
goals as circumstances change. For example, when you set up
an account with LINK by Prudential, you’ll be prompted to
answer questions about what financial goals are important to
you and, in turn, will be offered personalized solutions to
help you reach them. LINK combines the convenience of a
digital experience with the knowledge of a professional
advisor who can walk you through this important transition
by phone, video or in-person. To learn more, visit
prudential.com/link
• Consider Your Bonus: If
you’re receiving a sign-on bonus or have an old bonus saved,
determine whether this money belongs in a short-term,
no-risk account or whether a longer-term approach with
exposure to financial markets makes sense.
• Budgets are Fundamental:
If you’re making more money, calculate if additional funds
can be put into savings. This is a great place to use a tool
like LINK that allows you to see all your money in one
place, and can help you determine where to direct extra
funds. If you’re making less money, you might need to see
where to make cuts.
• Review Your Insurance:
Take a breath before moving forward with health coverage
decisions. If you’re married, evaluate both partner’s plans,
not only for the more affordable option, but also for each
plan’s restrictions. For instance, if one plan allows you to
see doctors without referrals while the other doesn’t,
you’ll have to decide whether that’s worth the extra cost.
Finally, take a look at the amount your new employer is
offering for life insurance. It’s often not enough.
Consulting a financial advisor can help you determine how
much additional insurance to take out.
Don’t let your financial
goals get lost in the shuffle of a job transition. A few
strategies and tools can keep you on track.
LINK by Prudential is an
umbrella marketing name for Prudential Customer Solutions
LLC, an SEC-registered investment adviser, Prudential
Annuities Distributors, Inc. and various subsidiaries of The
Prudential Insurance Company of America.
Courtesy StatePoint
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