Personal Finance

Switching Jobs? 6 Steps to Staying Financially Organized

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Whether you call it the Great Resignation, the Big Quit, or the Great Reshuffle, one thing’s for certain – there’s a huge employment migration underway. In fact, 4.3 million workers quit their jobs in August 2021 alone. 

If you’re one of the millions of Americans getting ready to step into a new position, you’ll want to keep track of your finances. Investing a small amount of time will pay great rewards, including sidestepping potential financial mishaps like a missed bill or a surprise expense.

Here Are 6 Steps to Keep Your Finances Organized

Here’s a comprehensive list of to-dos to keep you financially organized as you transition to your new job.

Step 1: Review direct deposits, scheduled transfers, and automatic bill pay 

Look at the accounts where you’re currently depositing your paycheck. Consider pausing automatic transfers and bill pays until your new direct deposit starts. In the meantime, set reminders on your calendar so you can check balances before making a manual payment or transfer. 

Don’t forget direct deposits into loans! Set a reminder to make manual payments until your new direct deposit is in full swing.

Step 2: Check bill due dates

Payday varies from company to company. If your new pay dates misalign with your credit card, utility, and other account due dates, reach out to billing departments. You may be able to request a due date that works with your new cash flow.

Step 3: Revisit your budget

Quite a bit changes when you start a new job. You face a new commute, perks, and – sometimes – even a new wardrobe. It’s important to see how these changes will impact your expenses to avoid a potential shock. Plus, you can brainstorm creative ways to offset new expenses. If you previously got a free gym membership that your new employer doesn’t offer, organize a running club with your coworkers. You’ll build friendships while working out for free.

Here are some budget categories that may be impacted:

  • Transportation, including vehicle maintenance and gas
  • Food
  • Health insurance
  • Healthcare, fitness, and wellness
  • Clothes and shoes
  • Recreation and entertainment

Our  helps you categorize your spending so you can easily adjust your budget as you settle into your new job. Link your accounts and check back regularly to see how your spending is changing.

Step 4: Consider your retirement account options

If you’ve been contributing to an employer-sponsored retirement account, such as a 401(k) or 403(b), you’ll need to decide the future of the funds. Here are four common account options:

  • Keep the funds in the current account
  • Roll it over to an individual retirement account (IRA)
  • Roll it over to your new employer’s sponsored plan
  • Cash it out

Each plan is different. Review the terms and fees associated with your current plan as well as your new employer’s plan. There are no penalties to roll over a 401(k) or 403(b) into an IRA or other qualifying plan. You’ll have to pay if you choose to cash out. As of 2021, the IRS penalty for retirement plan cash outs is 10% plus taxes. Check with your financial advisor to find the best plan for your situation.

Step 5: Check your current benefits

Talk to your HR team about your current benefits. Ask for a benefit expiration timeline and find out which benefits are extendable beyond employment. This could include your health insurance, health savings account (HSA), and flexible spending account (FSA) plans. 

Health insurance coverage typically ends on your last day of work, but you may be able to extend coverage through COBRA. You can also visit to find an individual plan. 

HSAs are portable – the funds remain with you when you switch jobs or retire. You’ll want to ensure you keep your account information so it’s easy to access and use the account.

Unfortunately, unused FSA funds typically go to your employer when you quit. An exception may be available through COBRA. Either way, you’ll want to use your funds by the end of the calendar year, as there’s a carryover limit. You can often donate unused funds to charity if you can’t use them all.

Step 6: Prepare for large purchases 

Does your new job put you in the market for a vehicle or home? Get an offer letter from your new employer showing your start date and salary. This provides your lender proof of steady income, especially if you’re staying with a similar industry and pay structure.

Changing industries, becoming self-employed, or moving to commission may limit your mortgage options. Axos offers more flexibility than many other lenders, so keep us in mind if you’re making a significant switch. Our expert mortgage team will help you evaluate your options and guide you through the home purchase process

Make an Ongoing Commitment to Your Finances

Financial goals and circumstances change. Make a commitment to revisit these financial to-dos at least once a year. As you move up the ranks in your new company, you’ll have an opportunity to expand your budget, increase your savings, and achieve other goals. 

As your goals and circumstances fluctuate, so do your banking needs. If you find yourself wanting up-to-date tech and secure, high yield accounts, Axos has you covered.

Switching Jobs? 6 Steps to Staying Financially Organized

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