Son just got let go...what to do next?

[RunningBum]

My son just called and told me he got let go from his job. I don't really know the details and it's nothing that would keep him from getting another job.

My main question is, aside from looking for a new job (which he had been doing anyway, but now will be more motivated) or possibly go back to school, what all should he be doing?

My thoughts:

0) Keep his head up and realize stuff happens, and not to take it personally. Have a short pity party and move on. He wanted out of there anyway (he was in retail) so this will probably turn out to be a good kick in a better direction.

1) Get on ACA. He loses the medical insurance he had through work. He'll probably come out better since he'll get a subsidy and was paying a good chunk for mediocre health care before. Any rules on how quickly he can do this?

2) File for unemployment compensation. Any rules here? He's already applying for jobs and will certainly be actively working.

Less urgently:

3) Move his 401K over to Vanguard. He had reviewed his investment options with me a couple years ago and I don't recall any especially good investment choices.

4) If this turns into a low income year we'll look at converting that 401K/IRA to a Roth, at least partially.

Any other advice? What are the best job seeking sites these days?

 

[COcheesehead]

My advice and to not give him any advice. These are the times when we learn the greatest lessons...on our own.

 

[Aerides]

0 - sure, that's Dad's role

1, 2 - that's his to know and talk to his HR. He can maybe cobra, but this is a "prove he knows how to swim" moment imo.

3,4, - at most I'd say, once he starts a new job, that you can help him with that stuff if he'd like.

Other than than, stick to 0.

 

[Gumby]

Now would be a good time to evaluate any recurring expenses, such as a gym membership when he doesn't ever go, unlimited phone plan when he doesn't use much data, subscriptions of various types, etc., with a view toward dropping some of them.

 

[gwraigty]

Any other advice? What are the best job seeking sites these days?

I'm not sure about the best, but I used Indeed to assist my son with his first job a few years ago. A friend of mine used Snag-A-Job. If he has some idea of companies he'd consider, he could go directly to their websites.

Don't discount job fairs. My son got a better job last year through a job fair at our local mall. It was sponsored by Goodwill. Their website might list some upcoming job fairs.

 

[jim584672]

Since he is let go mid year he might have blown past the ACA subsidy range already. If your state expanded Medicaid see if he can get on it. It is based on monthly income, so the previous months income doesn't factor into eligibility.

 

[cathy63]

He should find out the exact date when his medical insurance coverage ends and how much COBRA will cost. It is not a given that ACA will be cheaper, though if he's young or eligible for a subsidy, it probably will be. He may have to wait up to 7 weeks to get the COBRA information by mail (employer has 30 days to notify plan admin and admin as 2 weeks to mail notices), but he can elect it retroactively. If he does choose COBRA, then he has to stay on it until he gets coverage through another job or until the end of the year, whichever comes first.

Are they giving him severance and/or continuing to carry him on the payroll? If so, and he has the cash, he should put as much as he can in his 401K now. He might not be eligible for a new employer's 401K right away and he might want to show a lower income this year if he decides to go for an ACA plan.

 

[kgtest]

If it was my son, I would advise he 1. files for unemployment followed by 2. complete a 401k rollover to vanguard.

Then, I would make sure he is in a sound place mentally...if not I would encourage until he is. Been here once or twice.

The longest I was unemployed was right after I bought the McMansion and found out the pregnancy test came back positive. Was Unemployed for 6months and down to the literally last unemployment check...and didn't have much savings left.

NOW, I have a 1 year buffer of liquid assets, Lesson learned. (and here I used to be a 6month emergency fund person).

The 2 things I can remember is 1. it was stressful not having much purpose during the job search and 2. the ole man was impressed that me and the new wife managed to surfivie without asking him for money hahaha. I remember him making a comment like, I thought you would have needed some help. Naaaa!

 

[joeea]

My main question is, aside from looking for a new job (which he had been doing anyway, but now will be more motivated) or possibly go back to school, what all should he be doing?

Losing a job can be quite a motivator.

Don't let a job loss be the sole motivator to duck out of the workforce and go back to school. If there was real motivation for a career requiring further education, that could have been accomplished while working. Too many folks (hopefully not your son) just want to escape the real world for a while and go back to the carefree school days.

0) Keep his head up and realize stuff happens, and not to take it personally. Have a short pity party and move on. He wanted out of there anyway (he was in retail) so this will probably turn out to be a good kick in a better direction.

Good advice. I changed careers when I was laid off the first time. It turned out to be the best thing I ever did.

1) Get on ACA. He loses the medical insurance he had through work. He'll probably come out better since he'll get a subsidy and was paying a good chunk for mediocre health care before. Any rules on how quickly he can do this?

He could start the process today. He may still be covered for a while by his former employer, often until month end. And there is always COBRA.

2) File for unemployment compensation. Any rules here? He's already applying for jobs and will certainly be actively working.

He should file immediately. They will tel him all the rules. He must be actively looking for work, and provide proof that he is doing so.

3) Move his 401K over to Vanguard. He had reviewed his investment options with me a couple years ago and I don't recall any especially good investment choices.

Probably. Depends on the 401k.

4) If this turns into a low income year we'll look at converting that 401K/IRA to a Roth, at least partially.

If. Too early to be thinking this. The priority should be finding a good job so that this isn't a low income year. If he got any severance, it could even be a high income year. That happened to me after one layoff. I had 10 weeks of severance and found a new job in 2 weeks.

Any other advice? What are the best job seeking sites these days?

Depends on the domain in which he works.

He should use this time for some personal reflection
- why was he let go?
- what could he have done to prevent this from happening?
- is he financially prepared for losing a job?
- does he have a sufficient emergency fund?
- etc.

 

[jollystomper]

I would also suggest that he sign up with any local temporary employment agencies in his area, and, if his local area has some time of employment/workforce function, sign up with that. The latter can help him navigate the unemployment compensation process as well as provide him with additional resources/guidance for finding jobs.

 

[Big_Hitter]

why is everyone clamoring to move the 401k to vanguard?

 

[RunningBum]

Lots of good advice here, all very much on target, I thank all of you and invite more.

He lives about an hour away. I'll probably drive up there tomorrow to chat with him.

I agree this needs to be a learning and growing time for him. I just don't want to find out later he totally blew off health care, or never realized he could collect unemployment. But beyond that I guess I should at most ask what his plan is, and only butt in if he asks for help.

He was not at all interested in grad school and I suspect that holds. He had mentioned brewing school before. I'd be willing to support that but I'll let him bring it up.

Regarding ACA, he would qualify for a subsidy even if he worked all year, but was not eligible because of employer supplied HI. If he got a new job that took him out of the subsidy, that would be terrific, but unlikely.

 

[brett]

My only advice at this point would be not to rush into any job search. Plus the usual such as file for unemployment insurance or whatever it is called where he lives.

Spend some time understanding what career choice he would like to pursue and what would be required to get there. Perhaps a move to another area, some training/re-tooling, or go back to college or university.

This could be an opportunity for him to change his life direction. He should make the most of it instead of rushing into another job just for the sake of landing the job. He is going to be working for many years to come. May as well shoot for something he enjoys and and has a promising future. All that financial jazz is fine but the bottom line for me is working at something and for someone you enjoy.

 

[RunningBum]

why is everyone clamoring to move the 401k to vanguard?

Well,almost all on target. No one is clamoring. I said it was a less urgent task to do eventually.

 

[mystang52]

2 suggestions: As Dad, be supportive. Second, he should not be shy about "networking" any and all contacts/friends he has.

 

[LiveBelowMeans]

Brewing school? Has craft brewing peaked??

 

[RunningBum]

My only advice at this point would be not to rush into any job search. Plus the usual such as file for unemployment insurance or whatever it is called where he lives.

Spend some time understanding what career choice he would like to pursue and what would be required to get there. Perhaps a move to another area, some training/re-tooling, or go back to college or university.

This could be an opportunity for him to change his life direction. He should make the most of it instead of rushing into another job just for the sake of landing the job. He is going to be working for many years to come. May as well shoot for something he enjoys and and has a promising future.

Also good advice. We briefly touched base on that on the phone today, that this might be a good chance for a reset and I'm sure well talk more of it tomorrow.

As I said, he was unhappy in this job so trying to find something similar probably isn't best. He kind of fell into it as he went full-time from his part-time college job while looking for something in his field. He didn't have good grades in college. Perhaps somewhat due to partying but there were other big issues that made it understandable. I'm not going to get into it any more than that. Not sure how much the grades were the issue since I stayed hands off during his job search other than a couple leads through friends that didn't pan out. He's had to deal with the consequences of that and will do so with his future too. I just want him to know the door is open to other possibilities. He had been looking at different types of jobs/careers. It was from a position of strength while he had a job but now I guess he will have more focus on it.

 

[RunningBum]

Brewing school? Has craft brewing peaked??

That's a concern, for sure. I certainly won't be financing a micro-brew startup. I know of someone local who did for their son. It's still in business, but as of a couple years ago money was still being poured in.

 

[davebarnes]

why is everyone clamoring to move the 401k to vanguard?

Because his former employer might do a BK.
He needs to take control.

 

[davebarnes]

My only advice at this point would be not to rush into any job search.

I would modify this slightly.
Do not do any interviews for at least a week.
When we get the axe, we are angry. That anger will come thru in an interview.

 

[Big_Hitter]

Because his former employer might do a BK.
He needs to take control.

you can still be in control - plus you can roll that 401k money to the new employer 401k - more projections than IRA plus they have stable value funds and now, annuity options

 

[Franklin]

RunningBum, so sorry for this set back for your son. I have been there a few times with my sons. Most recently the oldest lost his job (second time), his wife quit hers and had a baby, and now she may have cancer. Ive heard that when it rains it pours...... Anyway Ive found that this is the time your son needs you the most. He is likely devastated and suffering from a lack of confidence. Love on him and provide positive feedback. Make sure he knows this too will pass!. He will come out of this stronger and wiser. Obviously developing a financial plan to bridge the unemployment is necessary, but the emotional hit is as important. Make sure he knows you are there for him, but you are not a blank check. After the dust settles, ask him to develop a plan and the 2 of you can go over it weekly. Ugh, I know your concerns. Dad time!!

 

[athena53]

On the job search- how soon he starts depends on his temperament. I was let go from a company and it honestly was a surprise other than knowing that job cuts were happening in other departments. No performance problems, they just "eliminated my position". I called a recruiter I knew as soon as I got home. Six weeks later I had a new job and multiple offers. It all depends on how much time he needs to re-group.

If he's not on LinkedIn, he should be. It's like FaceBook for business. Many recruiters (company recruiters and the traditional executive recruiters) use it as a source when they have openings. He may also find that some of his contacts are at companies where he might like to work. You have to apply on-line through the employer's portal 99% of the time but it sure helps to have someone at the other end who can put in a good word with the hiring manager.

As for moving the 401(k), I agree there's no rush but I'd move it somewhere since you've said the employer plan isn't that great. Once I left a company I yanked my 401(k) as well, just on principle (and none had stellar choices, anyway).

Please keep us posted. My son was told his company was getting out of the line of business for which he handles claims within a week after he and DDIL moved to a newer, bigger house and they found Baby #3 was on the way (they'd planned on that after they moved but I guess they were in a hurry). Fortunately, within a week he'd found another position in the company and is doing very well, but it gave me some new grey hairs.

 

[joylesshusband]

My advice and to not give him any advice. These are the times when we learn the greatest lessons...on our own.

+1

 

[RunningBum]

The replies to this thread are a good reminder that I react far too pragmatically to events like this. If a friend's dog died, I'd probably tell them "Pick that dog bowl up off the kitchen floor, you won't be needing that now and it'll just attract ants. And for god's sake, cancel your Amazon subscription for dog food!"

Maybe not quite that bad, but he sure doesn't need to be thinking about what to do with his 401K today or tomorrow.