What To Do If You Lose Your Job

By:  Art Koff, Founder of  www.RetiredBrains.com, which is now listed on www.myboomer2boomer.com

First apply for unemployment benefits.

In most states, there is generally 2 to 3 week waiting period before benefits start, so file immediately as the quicker you file the quicker you’ll start receiving your benefit checks. In many states you are able to file by phone or online.

Unemployment benefits are administered by states and not the federal government so eligibility requirements vary from state to state; however, as a rule, you are not ineligible if you left your job voluntarily or were fired for willful misconduct often referred to as fired with cause.

If your severance package provides a salary for a specified period, as opposed to a lump sum, you may not be eligible for unemployment benefits until the salary payments end. If you are unsure, you may go ahead and file for unemployment. Don’t assume you are not eligible. The state will tell you if your claim is denied or are deemed not eligible.

Most people who have been let go are eligible for up to 26 weeks of state unemployment benefits, plus 13 weeks of extended federal aid and these rules are being reviewed and extended regularly.  See http://www.edd.ca.gov/unemployment/Extended_Benefit_Information.htm for more information.

Unemployment benefits are smaller than your paycheck. The average unemployed worker received $293 a week in 2009 which replaced about 35% of the average weekly wage for U.S. workers, according to the Center for American Progress. The actual amount you are eligible to receive will be based on a percentage of your earnings over the previous 52 week period, up to your particular state maximum.

Be aware the unemployment benefits are fully taxable. Some states will allow you to have federal taxes withheld from your benefit checks if you wish. To check the rules in your particular state with regard to unemployment insurance site, go to http://workforcesecurity.doleta.gov/unemploy/ and click on “State Service Centers.” 

Second be sure you have health insurance coverage

This is extremely important for the obvious reason you and your family need the protection, but there is another sometime hidden reason and that is “pre-conditions”. If you lose your insurance or have a 63 days or more gap between corporate coverage, when you apply for new coverage it is possible the insurance company will exclude some areas of coverage indicating you came to them with this serious medical condition or illness already. In other words you were sick when you applied for the insurance.

Insurance companies generally cannot exclude conditions if you do not have a gap in coverage and you change from one company to another.

Under COBRA or the Consolidated Omnibus Budget Reconciliation Act of 1985 employers with 20 or more workers must allow laid-off employees to continue their coverage for up to 18 months; however you must pay 100% of the premium, plus administrative fees. The cost of this insurance is at the employer’s rate which is usually substantially less than what you would pay if you went to purchase the same type of coverage for you or you and your family directly with an insurance company.

If you happen to be an older worker you may not be able to find an individual policy that’s affordable and if you or a family member has a serious medical condition, you may not be able to buy an individual policy at any price.

COBRA law says that when you leave your job, your employer must provide you 60 days to decide whether to continue your coverage. Once you sign up for COBRA, the coverage is retroactive, so any medical bills incurred during that 60 days will be covered.

It is important to consult with your company’s insurance benefits professionals before making important insurance related decisions. You can also speak with your state’s department of insurance http://www.naic.org/state_web_map.htm  or with a private attorney to make sure you are making the right decisions and your rights are protected.

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