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7 Financial Planning Strategies for Your Own âGreat Resignationâ
Making a career change can affect your financial planning strategies. It is critical to plan and prepare for how this change might affect you and your finances.
Besides considering the potential of your new career and the education or training you may need, you must carefully analyze your budget, savings, health insurance and retirement goals before committing to such a significant life change.
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If you are one of the many people considering a career change during this wave of the Great Resignation, a CFP® professional can help you plan for the change and smoothly transition to the next phase of your life.
1. Be honest about why you want to change careers
Take an honest look at why you want to make such a magnificent change in your life before making the jump. Ask yourself:
- Do you have a passion for another industry or type of career?
- Are you dissatisfied with your current work environment? Is it too stressful? Toxic company culture? Intolerable boss or management?
- Are you seeking a higher-paying profession?
- Do you want an improved lifestyle, such as a shorter commute or more time for yourself and your family?
Figuring out the âwhyâ before making a significant career change can help you target the right industry, types of employers and roles in your job search.
2. Look for ways to pivot
Depending on the type of change youâre after, you may be able to take a new opportunity for a test-drive by pivoting. Before diving in, brainstorm options to pivot your career:
- Can you change your current situation without changing jobs?
- Does changing careers involve starting a small business or becoming self-employed?
You can make a low-risk transition by going part-time with your current career to work on your new job simultaneously, taking night or weekend classes, and seeking advice from people who have made similar career changes. This way, youâll have time to explore whether you like your new career while having the safety net of staying at your current job.
3. Scrutinize your budget
When the cash is steady, you may confuse your âwantsâ with your âneeds.â However, it is critical to focus on needs and reduce spending on desires when changing careers.
If you haven’t looked at your budget in a while, take a financial inventory â tally up your net worth and identify cash you can quickly access. Consider essential spending, like your mortgage or rent payment, versus things you can cancel or stop doing to save money.
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Determine which subscriptions and other recurring costs you can cancel or downgrade. For example, if your credit card charges an annual fee, ask to switch to a card without a fee. Reduce your food bills by learning to cook or meal prep at home. Take advantage of online classifieds to sell unnecessary items taking up space or buy things you need at a discount.
While you reduce costs, set aside the money you save in a savings account. Creating a financial safety net gives you choices. Plus, itâs easier to make decisions based on what you want out of life and not what brings in money to pay this month’s bills.
4. Make a plan for health insurance
According to an analysis of the Census Bureau’s American Community Survey by the Kaiser Family Foundation, nearly half of all Americans get health insurance coverage from their employer.
If you fall into that category, make a plan for health insurance to fill the gap until your new employerâs coverage begins. You may have the option to continue your coverage through COBRA, get covered under your partnerâs plan, or find a policy on the health insurance marketplace at Healthcare.gov.
5. Leave your retirement accounts alone
While raiding your 401(k) to fund a new business or career is tempting, it can hurt you. Early withdrawals trigger a 10% early distribution penalty if you are younger than 59½. Youâll also pay income tax on the money you take out.
But most importantly, withdrawing your retirement accounts hinders your ability to fund your retirement. When you take out your 401(k) prematurely, you lose the compound interest and stock growth you would have earned.
6. Earn new credentials
Many people changing careers opt to go back to school for certifications or another degree. New training and credentials can boost your job options and give you a leg-up when applying for new roles. But first, consider if you:
- Need money to finance those expenses?
- Have enough savings? How long can your savings cover you until they are depleted?
- Can live off your partnerâs income while you retrain for a new career?
- Can qualify for scholarships or special programs for experienced workers?
Education isnât always necessary to change careers. You might find a way to skip the expense, network with other professionals, and land a job you love.
7. Prepare to re-enter the job market
If you took time off to re-educate yourself for your new career, consider your job prospects once you complete your education.
You may need to take an entry-level job to start. When switching careers, some fields may let you shift to a similar level to the one you had in your previous job, but some donât. For example, doctors, nurse practitioners and other health care providers may require you to first start as an intern.
Saving money upfront for a job change can help to supplement a lower starting salary. But long term, your new career may have stronger growth potential.
Think through potential scenarios, income sources and expenses when planning a career change. Changing careers can lead to financial insecurity if you do not plan properly. A CFP® professional can help you prepare and plan for a career change. Besides these seven strategies, they can uncover additional ideas to consider based on your circumstances.
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What is BitClout and How Does It Work?
Reputation is, in some sense, the ultimate asset â itâs associated with an individual person, it can be degraded quickly and itâs hard to build up, but once itâs established, can be converted into all sorts of value. This is where BitClout steps in. BitClout, also known as DeSo (which stands for “Decentralized Social”), is […]
The post What is BitClout and How Does It Work? appeared first on SoFi.
Primecap Odyssey Growth Has a Rough Year
The managers at Primecap Oydssey Growth (POGRX) like to focus on what they do best â pick stocks â and they typically don’t talk to reporters.
So once a year, when the fund’s annual report comes out, we read every word. Over the past 12 months, Kiplinger 25 member Odyssey Growth gained 12.7%, which trailed the 24.7% gain in the S&P 500.
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We’re not worried. Short-term returns can be instructive and add some perspective, but long-term performance matters most.
And over the long haul, Primecap’s managers have not disappointed shareholders. The fund’s 15-year annualized return, 11.3%, beat the S&P 500 by an average of 0.7 percentage point per year.
But 2021 was a win-some, lose-some year for the fund. Some of the fund’s top 10 holdings generated market-beating returns. Shares in banking giant Morgan Stanley (MS), for instance, gained 42% over the past 12 months. Other top holdings jumped even higher: Eli Lilly (LLY) was up 59%; Alphabet (GOOGL), 54%; and Microsoft (MSFT), 45%.
Biotech Stocks Stumble
But the fund holds 15% of assets in biotech stocks â a chunk, relative to the 2% exposure in the S&P 500 â which pressured results.
Biotechnology was the worst-performing slice of the health industry over the past 12 months, thanks in part to drug-pricing concerns and regulatory issues.
Epizyme (EPZM) dropped 81% over the past 12 months after an “anemic” new drug launch, the Primecap managers reported. And FibroGen (FGEN) stumbled, too, losing 66% after clinical missteps and regulatory setbacks.
China proved to be a snag as well. The fund has a significant stake in Alibaba (BABA), the Amazon of China, and the stock slipped 43% over the past 12 months because of increased government scrutiny.
The fund’s five managers divide and run a portion of the fundâs assets independently. But they all favor stocks in fast-growing firms with long-term growth potential that they think the market has underestimated. When they buy, they tend to hold. The fund’s 7% turnover implies a typical holding period of more than a decade. They’re patient and willing to wait for their investment thesis to play out. We’ll wait with them.
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Personal Liability Insurance Coverage
Think your homeowners or renters insurance policy is just about covering your physical home and the stuff inside it? Think again. Most homeowners and renters policies include personal liability insurance coverage, as well â an important type of coverage that can really come in handy if you end up needing it. Personal liability insurance coverage […]
The post Personal Liability Insurance Coverage appeared first on SoFi.
[Targeted?] Venmo Credit Card $200 Signup Bonus With $1,000 Spend
The Venmo credit card now offers a $200 cash bonus when you sign up for the card and spend $1,000 within the first 3 months
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Make the Most of the New Workplace
Natasha Bowman, author of You Canât Do That at Work, is founder of Performance ReNew, a workplace consulting firm.
The workplace is changing rapidly. How will those changes affect current employees and people looking for a job? We were hoping to move into a post-pandemic workplace in 2022, but with the resurgence of COVID-19, return-to-work plans are changing. Employees can expect to continue working remotely or in a hybrid situation until the pandemic is over. Employers are also looking to hire a more inclusive, diverse workforce that goes beyond race and gender. Thereâs a war to attract and keep the best and the brightest for talent. Employers have learned that if they donât want to experience a labor shortage, theyâre going to have to revise their mental health and wellness strategies. Thatâs more than just discounted gym memberships and nutrition programs. It means continuing to offer therapy benefits provided during the pandemic and having quiet spaces in the office where folks can go to when they need to recharge.
Employers must also figure out how to provide the flexibility that people felt while they were working remotelyâthe flexibility that allowed them to both work and enjoy things that theyâre passionate about. Â
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How can job seekers take advantage of these changes in the workplace? If youâve been working remotely (and want to continue), talk about what youâve been able to accomplish in the past couple of years and how that has worked for you and benefited the company. If you cut out your commute, talk about how youâve been able to put that time back into your job. Â
At the end of an interview, if the hiring manager asks, âDo you have any questions for me?â donât forget to ask about the organizationâs culture. Most people just ask about pay, but many folks are willing to take a pay cut if it means greater flexibility to support their mental health. Also, ask if you can speak with current employees you could be working with. Itâs a bold question, but job seekers have that kind of leverage now. You want to confirm that what the hiring manager said about the culture is true. Â
Whatâs the most effective way to secure an interview? Send your résumé or application directly to the hiring manager, recruiter or someone in that organization. That continues to be the way to make sure that your résumé is being seen. Use LinkedIn to make the connections. Sending materials to the company through its online job portal usually wonât do it because they get thousands of applications and end up reading maybe the first 15 to 20.
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How can employees who want to continue working remotely but arenât interested in leaving their current job take advantage of the changed workplace environment? Let your employer know just how much your productivity has improved and how that has contributed to overall company success. Research your competitors to see how theyâre handling remote work. If they allow it, bring that up. If your company continues to take a hard stance on working from the office, ask for an accommodation, such as coming in a few days a week. If youâve been doing a good job working from home, itâs going to be hard for your employer to say remote work will hurt your performance.
How The âNo Surprises Actâ Affects Your Medical Bills (and Possibly Your Care)
Most Americans have heard stories about surprise medical bills that can cost unknowing patients thousands of dollars for what they may have thought were simple or necessary procedures. However, the practice of surprising patients with medical bills may soon be … Continue reading →
The post How The âNo Surprises Actâ Affects Your Medical Bills (and Possibly Your Care) appeared first on SmartAsset Blog.
How to Get 3 Free N95 Masks Courtesy of the Federal Government
On the heels of offering four free COVID-19 tests to all American households, the U.S. government recently announced it will distribute 400 million free N95 masks to the public. The masks, which the CDC says provide the greatest protection against the highly contagious Omicron variant, will be shipped to pharmacies and community health centers and [â¦]
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.