Chances are you will experience a job change at some point during your working life. Typically, a job change is an exciting event. However, it can create unplanned financial stress and an overwhelming transition. According to a survey conducted by the Bureau of Labor Statistics, the average person changes jobs 10 to 15 times during his or her career.
Before accepting a new job offer, you should take the time to evaluate the differences in your existing benefits package versus your new benefits package. To simplify this process, here are some key items you should evaluate:
Disability income coverage: This provides you money if you were to become disabled for a short or long period of time. Does your new benefits package offer this coverage?
A short-term disability is typically defined as coverage for three to six months, whereas a long-term disability is more than six months. Keep in mind, disability income coverage is different than workers compensation coverage. Workers compensation will only provide coverage if you are injured at the workplace.
Disability income coverage typically covers an individual 24/7, on and off the job. If it’s not offered, you may want to consider purchasing an individual policy.
Life Insurance coverage: Does your new benefits package offer life insurance coverage? Is the coverage enough to cover your mortgage and other bills? If not, you may want to consider purchasing an individual life insurance policy.
Also, it is never too early to start thinking about retirement. Typically, your work-provided life insurance policy expires when you retire. Purchasing an individual life insurance policy while you are young and healthy may be a more affordable option and follow you into retirement.
Retirement plan: Did your previous benefits package offer a 401K or some type of savings plan for retirement? If so, typically those funds will need to be distributed to you or transferred to another plan. In most situations, transferring those funds is best because it negates taxation and IRS penalties, as well as continues to save those funds for retirement.
Does your new package offer a retirement plan? If not, exploring the options of an individual retirement plan or annuity coverages may be beneficial to continue to save for your retirement. Changing jobs is a major life event.
As with all your major life events, we are here to discuss your options. Contact our agency to review your life and annuity coverages today.