Who is Bill Rhodes? Rhodes has extensive experience as a corporate executive as he previously served as the president and CEO of AutoZone for 18 years, contributing to the firm’s expansion of stores as well as increasing its revenue and enhancing its online presence and services. Prior to that role, Rhodes led store operations as … [Read more…]
If you find yourself in a bad financial situation, making an early withdrawal from your 401(k) may sound tempting. But early withdrawals from your 401(k) come with hefty fines and can put your retirement at risk. So, before you do this, you should be sure that it’s truly a financial necessity.
That being said, there are situations when it makes sense, and occasionally, you can find ways to get the fees waived. This article will review everything you need to know before making an early 401(k) withdrawal.
Early 401(k) Withdrawal Options
Wondering if you can tap into your 401(k) funds ahead of schedule? The ability to make an early withdrawal from your 401(k) hinges on several factors, including your employer’s policies, the specifics of your plan, and your current employment status. Here’s a straightforward guide to understanding your options.
Checking With Your Employer
Your first step should be to get in touch with your human resources department. Not every employer permits early withdrawals from their 401(k) plans, and those that do may have specific criteria and procedures you’ll need to follow. The ease of starting this process and the options available to you will depend on various factors, such as your age and the specific rules of your plan.
For Former Employees
If you’re no longer employed with the company that holds your original 401(k), reaching out to the plan’s administrator is your next move. The administrator can provide you with the necessary steps and documentation required to initiate an early withdrawal. They’ll guide you through the process, ensuring you understand any implications or penalties associated with accessing your funds prematurely.
For Current Employees
Still working for the company where you’ve built your 401(k)? There might be restrictions on your ability to make early withdrawals. But don’t lose hope; you might have the option to borrow against your 401(k) instead.
Taking a 401(k) loan can be a viable alternative, offering a way to access your funds without the penalties associated with early withdrawals. We’ll delve into the specifics of 401(k) loans and how they work later on, providing you with all the information you need to make an informed decision.
401(k) Early Withdrawal Penalties
When it comes to pulling money from your 401(k) before reaching the age of 59 ½, the Internal Revenue Service (IRS) doesn’t give you a free pass. Let’s break down what this really means for your wallet. You’re not just facing a flat fee; it’s a combination of penalties and taxes that can significantly reduce the amount you end up with.
The 10% Penalty Explained
If you dip into your 401(k) early, the IRS imposes a 10% penalty on the amount you withdraw. This is their way of discouraging people from using their retirement savings prematurely. For example, if you withdraw $10,000, you owe $1,000 right off the bat to the IRS as a penalty.
Tackling the Tax Implications
But the financial impact doesn’t stop there. Since 401(k) contributions are made pre-tax, when you take money out, it’s considered taxable income. This means the amount you withdraw will be added to your total income for the year, potentially pushing you into a higher tax bracket.
To illustrate, let’s say you’re in the 22% tax bracket. On a $10,000 withdrawal, you’ll owe $2,200 in income taxes, in addition to the $1,000 penalty. So, from your $10,000, you’re down $3,200, leaving you with $6,800.
Real-World Example for Clarity
Imagine John, who decides to withdraw $10,000 from his 401(k) to cover an unexpected expense. John is in the 22% tax bracket. Here’s how his withdrawal breaks down:
10% early withdrawal penalty: $1,000
Income tax (22%): $2,200
Total deductions: $3,200
Amount John receives: $6,800
This example highlights the importance of considering the combined effect of penalties and taxes on early 401(k) withdrawals. It’s not just about the immediate need for cash but understanding the long-term impact on your retirement savings.
Tax Planning Strategies for Early 401(k) Withdrawals
Making an early withdrawal from your 401(k) can have significant tax implications. However, with careful planning, you can manage these impacts more effectively. Here are strategies to consider:
Spread Out Withdrawals
If possible, spreading out your withdrawals over several years can help manage your tax bracket. Large withdrawals can push you into a higher tax bracket, increasing your overall tax liability. By taking smaller amounts over time, you may stay within a lower tax bracket, reducing the amount of taxes owed.
State Tax Considerations
Remember that state taxes can also apply to 401(k) withdrawals. Tax rates and regulations vary by state, so it’s essential to understand the rules in your state and plan accordingly. Some states offer tax breaks or exemptions for retirement income, which could influence your withdrawal strategy.
Reinvesting Withdrawn Funds
If you must make an early withdrawal but don’t need the funds immediately for expenses, consider reinvesting them in a tax-advantaged account. This could be a Roth IRA, where withdrawals in retirement are tax-free, or a health savings account (HSA), if eligible. These moves can help mitigate the tax impact and potentially grow your investment tax-free.
Implementing these tax planning strategies can help you navigate the complexities of early 401(k) withdrawals, minimizing the tax bite and keeping your retirement goals on track. Consulting with a tax professional or financial advisor can provide personalized advice based on your individual situation and financial goals.
Hardship Withdrawal Eligibility and Requirements
When life throws you a financial curveball, tapping into your 401(k) through a hardship withdrawal might seem like a viable option. This choice allows you to access your retirement funds early without the standard 10% penalty, under specific conditions. Let’s explore what qualifies as a hardship withdrawal, the documentation you’ll need, and how to prove your need effectively.
Qualifying Conditions for Hardship Withdrawals
Hardship withdrawals are not given out for just any reason. The IRS defines specific scenarios where these withdrawals are permitted. These include:
Unreimbursed medical expenses: Significant out-of-pocket medical costs for you, your spouse, or dependents.
Home purchase: Down payment and closing costs for buying your primary residence.
Tuition and education fees: Tuition, related educational fees, and room and board expenses for the next 12 months of postsecondary education for you, your spouse, children, or dependents.
Prevention of eviction or foreclosure: Amounts necessary to prevent eviction from or foreclosure on your primary residence.
Funeral expenses: Costs related to the death of a family member.
Repair of damage to primary residence: Costs for repairs to your home that would qualify for the casualty deduction under IRS rules.
Documentation Requirements
To successfully apply for a hardship withdrawal, you’ll need to provide substantial proof that your situation matches one of the qualifying conditions. This might include:
Unreimbursed medical expenses: Bills and statements from healthcare providers, showing the costs not covered by insurance.
Home purchase: Mortgage documents or contracts that highlight the purchase of a primary residence.
Tuition and education fees: Invoices from the educational institution for tuition, along with documentation for related expenses.
Prevention of eviction or foreclosure: Notice of eviction or foreclosure proceedings against your primary residence.
Funeral expenses: Funeral home invoices or other documentation of related expenses.
Repair of damage to primary residence: Estimates or receipts for repairs necessary due to damage that qualifies for a casualty deduction.
The Process of Proving Hardship
Proving hardship is more than just submitting documents. You’ll need to:
Contact your plan administrator: Start by reaching out to your plan’s administrator. They can guide you through the specific requirements and process for your plan.
Gather your documentation: Collect all relevant documents that substantiate your claim. This may require obtaining records from various sources, so it’s wise to start this step as soon as possible.
Complete the application: Fill out the necessary application forms provided by your plan. Ensure all information is accurate and attach your supporting documentation.
Await approval: After submitting your application, there will be a review process. During this time, your plan administrator may request additional information or clarification.
While a hardship withdrawal can offer a lifeline during financial distress, it’s crucial to approach this option with a full understanding of the qualifications and process. Remember, these withdrawals can impact your retirement savings, so consider all alternatives before proceeding.
Should you consider a 401(k) loan instead?
Considering a 401(k) loan instead of an early withdrawal might be a strategic move under certain circumstances. Below, we will clarify the nuances of 401(k) loans, including repayment conditions, interest rates, and when it’s advantageous to choose this option over withdrawing funds directly.
The Basics of 401(k) Loans
A 401(k) loan allows you to borrow against the savings in your retirement accounts without incurring the penalties and taxes associated with an early withdrawal. It’s a feature many plans offer, providing a way to access your funds for immediate needs while still keeping your retirement goals on track.
Repayment Terms
Repayment terms for 401(k) loans vary by plan, but typically, you’re expected to repay the loan within five years. Payments are usually set up on a monthly basis and are deducted directly from your paycheck, making the repayment process straightforward and manageable.
Interest Rates
The interest rate on a 401(k) loan is often comparable to or slightly higher than current market rates, but significantly lower than the rates associated with credit card debt or personal loans. The interest you pay goes back into your 401(k) account, essentially paying yourself back with interest, which can make this option particularly appealing.
When to Consider a 401(k) Loan
Choosing a 401(k) loan over a direct withdrawal or other financial avenues can be wise in several scenarios:
Avoiding penalties and taxes: If you need access to funds but want to avoid the penalties and taxes associated with an early 401(k) withdrawal.
Debt consolidation: When looking to consolidate high-interest debt under a lower interest rate, thus saving money in the long term.
Major expenses: For significant expenses, such as home repairs or medical bills, where using a 401(k) loan can provide a financially responsible solution.
Before opting for a 401(k) loan, consider the impact on your retirement savings. While you’re repaying the loan, the borrowed amount is not invested, potentially missing out on market gains. Additionally, if you leave your job, the loan may become due in full much sooner than the original five-year term.
Substantially Equal Periodic Payments (SEPP): A Closer Look
When considering accessing your 401(k) or IRA funds before the typical retirement age without facing penalties, the Substantially Equal Periodic Payments (SEPP) program can be a lifeline. This strategy requires a commitment to taking consistent withdrawals for a significant period. Let’s dive deeper into how SEPP works, how to calculate your payments, and when this approach might be particularly beneficial or risky.
How to Calculate SEPP Payments
Calculating your SEPP involves choosing from one of three IRS-approved methods: the Required Minimum Distribution (RMD) method, the Fixed Amortization method, and the Fixed Annuitization method. Each method uses your current account balance and life expectancy factors to determine annual withdrawal amounts, but they vary in flexibility and payment amounts.
RMD method: This method recalculates your payment each year based on the current account balance and your life expectancy.
Fixed amortization method: This calculates a fixed annual payment based on your life expectancy and account balance at the start of the SEPP plan.
Fixed annuitization method: This uses an annuity factor to determine annual payments, resulting in fixed payments for the duration of the SEPP period.
Scenarios Where SEPP Might Be Advantageous
SEPP plans can be particularly useful in several situations:
Early retirement: If you plan to retire early and need a steady income stream, SEPP allows you to access your retirement funds without the 10% early withdrawal penalty.
Bridge income gap: For those who need to bridge an income gap until other retirement benefits kick in, such as Social Security or pensions.
Financial emergencies: In cases where there are substantial financial needs before reaching 59 ½, SEPP provides a structured way to access funds.
Potential Pitfalls and Considerations
While SEPP offers a way to access retirement funds early, there are important considerations to keep in mind:
Commitment: Once you start SEPP, you must continue the withdrawals for at least five years or until you reach age 59 ½, whichever is longer. Deviating from the schedule can result in retroactive penalties.
Market risk: Your account is still subject to market fluctuations, which can impact your balance and, potentially, your withdrawal amounts if you’re using the RMD method.
Locking in losses: If you withdraw money during market downturns, it can lock in losses, potentially jeopardizing the longevity of your retirement funds.
SEPP can be a strategic tool for managing retirement funds before reaching the traditional retirement age. However, it’s crucial to carefully assess your financial situation, consider the long-term implications of starting SEPP, and consult with a financial advisor to ensure this strategy aligns with your overall retirement planning goals.
Alternatives to Early 401(k) Withdrawals
Accessing your 401(k) early can come with significant financial repercussions, including penalties and taxes that diminish your retirement savings. Fortunately, there are several other strategies you can consider to meet your financial needs without tapping into your retirement funds prematurely. Let’s delve into some of these alternatives and how they might serve as viable solutions.
Borrow from Family or Friends
One of the most straightforward alternatives is to seek a loan from family or friends. This option can offer more flexible repayment terms and potentially lower (or no) interest rates. However, it’s essential to approach this solution with clear communication and, ideally, a formal agreement to avoid any misunderstandings or strain on your relationships.
Sell Personal Assets
Another strategy is to evaluate your personal assets for items that you can sell. This could range from high-value items like a second car or recreational vehicles to smaller, valuable assets such as electronics or collectibles. Selling assets can provide a quick influx of cash without the need to worry about interest rates or penalties.
Explore Government and Non-Profit Assistance
For those facing financial hardship, various government and non-profit programs offer financial assistance. These programs can provide support for a range of needs, including housing, utilities, food, and medical expenses. Researching and applying to these programs can offer a way to bridge your financial gap without compromising your retirement savings.
Consider Home Equity Loans and HELOCs
If you have equity in your home, tapping into it through a home equity loan or a home equity line of credit (HELOC) might be a strategic alternative to early 401(k) withdrawals. Both options can offer more favorable interest rates than a personal loan or credit cards, but with distinct differences in how you access and repay the funds.
Home Equity Loans
Home equity loans provide a lump sum at a fixed interest rate, making it an excellent choice for one-time, significant expenses. The predictable repayment schedule helps with budgeting but requires you to take out a precise amount from the start.
HELOCs
HELOCs, in contrast, offer a flexible credit line, similar to a credit card, but with lower interest rates. This option allows you to borrow as needed over a draw period, usually with variable interest rates. The flexibility is ideal for ongoing expenses, but it’s vital to manage this responsibly due to the fluctuating payments.
Personal Loans and Credit Options
Personal loans from banks or credit unions, as well as low-interest or 0% APR credit card offers, can also provide temporary relief. These options may come with higher interest rates than a HELOC but don’t require collateral. When choosing this route, it’s vital to compare offers and understand the terms to ensure they align with your financial recovery plan.
Conclusion
When faced with financial needs, deciding whether to access your 401(k) early is a significant choice. It’s crucial to weigh the immediate benefits against the long-term impact on your retirement savings. As we’ve explored, alternatives like borrowing from family or friends, selling personal assets, or tapping into home equity through loans or HELOCs can provide the necessary funds without the drawbacks of early withdrawal penalties and taxes.
For those considering a 401(k) loan or Substantially Equal Periodic Payments (SEPP), these options offer ways to access your funds while minimizing the negative effects on your retirement account. However, each choice comes with its own set of considerations and potential impacts on your financial future.
Ultimately, the decision should align with your overall financial strategy and long-term goals. Consulting with a financial advisor can provide personalized advice, helping you to make an informed choice that balances your immediate needs with your retirement aspirations. Remember, the goal is to ensure financial stability now without compromising your future well-being.
Inside: Explore the right ways to quit a job without notice. Learn the best excuses, how to resign gracefully with a sample resignation letter, and tactics for maintaining professionalism when quitting.
Resigning from a job without notice can be a highly discomforting experience, as it breaks the standard professional protocol and can leave an employer in a difficult position.
Such an abrupt departure might lead to awkward conversations with superiors or colleagues who may be blindsided by the sudden lack of manpower and the hastiness of the exit.
This is something you know must be done.
I know the embarrassment stems from the awareness that this action could tarnish my professional reputation and relationships within the industry. Moreover, exiting without notice may invoke anxiety about the possibility of negative references or the implications it could have on future job prospects.
Yes indeed, this uncomfortable decision carries with it a heavy weight of potential judgment and professional repercussions.
So, what do you need to do when it’s time to quit?
How do you politely resign without notice?
To resign without notice politely, it’s essential to write a succinct and professional letter to your direct supervisor or HR manager, stating your immediate departure.
Express regret for any inconvenience caused and, if feasible, offer to assist in transitioning your duties. Deliver the letter personally if possible, or via email if necessary, maintaining a courteous and composed demeanor throughout the process.
It’s crucial to keep communications respectful and to retain professionalism to ensure a positive lasting impression.
Quitting Without Burning Bridges
Resigning from a job is a significant decision, and it’s generally expected that employees provide notice, traditionally two weeks, when they decide to leave.
However, in certain situations, giving notice may not be feasible, and you may need to resign immediately. Even so, it is possible to part ways amicably and without causing undue tension.
Make sure you do the following items:
1. Formalize the Resignation
Submit a formal resignation letter and discuss with HR any final procedures you may need to follow, such as filling out exit paperwork or partaking in an exit interview.
This is the first step that must be taken care of with kindness.
2. Making Sure to Tie up Loose Ends
Leaving a job without notice certainly poses challenges, but it’s critical to make sure you tie up as many loose ends as possible. Doing so demonstrates your professionalism and reduces the potential for negative repercussions.
It is super helpful if you can document your work to show your current responsibilities and projects. Include deadlines, key contacts, and any necessary instructions to help the next person take over your tasks.
3. Offer Assistance with Transition
Be willing to help the company prepare for your departure. This can involve creating thorough handover notes, compiling a list of important contacts, or outlining the status of ongoing projects.
If possible, offer to train a replacement or the person taking over your responsibilities. This may not be feasible if you’re leaving immediately, but you could suggest remaining available for a set period to answer questions via phone or email.
4. Return Company Property
Ensure you return any company property, such as laptops, mobile devices, keycards, or other equipment or materials. Do this before your departure to avoid any misunderstandings or trust issues.
Best Excuse to Quit a Job without Notice
As you know, multiple factors may prompt a professional to resign abruptly and it is never easy. It is rarely taken lightly and often stems from compelling, unavoidable circumstances.
Here are some of the most common reasons.
#1 – Personal or Family Emergency as a Valid Excuse
Personal or family emergencies stand as one of the most understandable and widely accepted reasons for quitting a job without notice. When hardship strikes, employers often recognize the need for immediate attention and the impossibility of predicting these crises.
Here’s why a family emergency can be a valid family emergency excuse:
Unpredictable Nature: Emergencies, almost by definition, are sudden and unexpected, leaving little room for the luxury of planning.
Moral and Social Norms: There’s a broad acknowledgment in society of the priority of family and personal well-being over occupational obligations.
Legal Considerations: Some jurisdictions have laws that protect employees who must leave work due to family emergencies.
Human Understanding: Colleagues and superiors are often sympathetic to family emergencies since such situations can happen to anyone, at any time, fostering an environment of understanding.
The gravity of a family emergency that might compel one to quit abruptly could range from a serious illness or accident to a sudden need for care for a family member.
#2 – Sudden Health Issues that Require Immediate Attention
When an individual’s health or life is at stake, it invariably takes precedence over job responsibilities. However, many people should opt for short-term disability to keep their health coverage as well as a smaller paycheck.
Recovery from a health crisis isn’t always quick and can necessitate an extended period away from work that cannot be predicted at the outset.
Physical and Mental Limitations: Health issues might limit the physical or mental capacity to perform job duties effectively or safely.
Quality of Life: Severe health problems can drastically alter one’s quality of life, making job concerns secondary to finding a path to wellness.
Workplace Accommodations: Sometimes, current workplace accommodations may not be sufficient to support an employee’s health needs.
Legal Protections: In many regions, employment law provides protections for workers who must leave their jobs due to health concerns.
It’s worth noting that particulars around personal health are private, and sharing details is at the discretion of the individual. Moreover, a discussion with human resources may provide options such as a leave of absence or disability leave, which could offer an alternative to resigning.
#3 – An Irresistible Job Offer That Can’t Be Delayed
At times, a career opportunity arises that is so compelling it warrants immediate action, with a start date that doesn’t accommodate a notice period.
In such cases, the opportunity cost of staying may be too high to ignore. Especially if you can make over $10k a month.
Unique Opportunities: The offer might represent a unique or rare advancement in one’s career that is unlikely to come around again, making it a now-or-never decision.
Significant Benefits: An offer that significantly improves financial standing, work-life balance, benefits, or professional growth can merit a swift transition.
While quitting a job without notice is far from ideal, certain career moves justify this approach. In these situations, one must weigh the professional norms against the career-defining potential of the new opportunity.
#4 – Immediate Relocation Due to Spouse or Partner’s Job
Unfortunately, relocations are often dictated by the partner’s employer or business needs, leaving little choice or room for negotiation regarding timelines.
Tackling this conversation as soon as possible allows your employer to start considering replacements and preparing for the transition, while also demonstrating your goodwill and integrity despite the abrupt notice.
If possible, see if you can transition to a remote position and keep your job.
#5 – Encountering a Toxic Work Environment for Mental Health
A toxic work environment can significantly impact an employee’s mental health.
When these negative aspects of the workplace become overwhelming, resigning without notice can be a necessary step to preserve well-being. This could be from unreasonable pressure, harassment or bullying, excessive workload, or a persistently high-stress environment that can all contribute to an unhealthy workplace.
Document the Environment: Keep records of incidents that contribute to the toxic environment, especially if they are egregious or repetitive, as these may be necessary for explaining your abrupt departure if questioned by future employers or legal entities.
Consult with HR: Ideally, concerns should be reported to human resources or appropriate management before deciding to leave, but if the situation does not improve or worsens, this may reinforce your decision to resign.
In such environments, taking immediate steps to leave may be the best course of action for personal health.
#6 – Safety Concerns in the Workplace Demanding Prompt Exit
When an employee feels that their physical well-being is at risk, it becomes necessary to prioritize personal safety over professional obligations.
Here’s why safety concerns justify a prompt exit:
Legitimate Fear: If the work environment poses a genuine risk to physical health or life — due to hazardous conditions or failing to meet safety regulations — immediate resignation is warranted.
Unresolved Issues: Continued employment might not be tenable if you’ve reported safety concerns and they have not been addressed in a timely or effective manner by management.
Legal Compliance: Employers are legally obliged to provide a safe working environment. Non-compliance with this fundamental requirement creates a justifiable reason for employees to leave without notice.
When resigning due to safety concerns, clearly explain that your primary reason for leaving is the need to ensure personal safety. It’s important to have a record of safety concerns reported to the appropriate parties within the organization, even if those concerns were not adequately addressed.
#7 – Legal Issues That Hinder Continuation of Employment
Legal issues can be sensitive and complex, thus it is important to maintain confidentiality and professionalism throughout the resignation process. When legal constraints interfere with employment, here’s why they necessitate an urgent departure:
Binding Legal Obligations: Court orders, such as those related to family or criminal law matters, may impose restrictions on an individual’s movements or activities that are incompatible with their current employment.
Visa or Work Authorization Changes: For employees working in a country under specific visas or work authorizations, any changes or revocations in legal status can demand an immediate resignation.
Conflict of Interest: Discoveries of conflict of interest that might have legal repercussions for the employee or employer can justify instant resignation to prevent further complications.
Mandated Reporting: Certain legal issues could force an employee to stop working immediately, such as those involving mandated reporting of unethical or illegal activities.
Ensuring clarity and integrity in communication can help in maintaining a positive relationship with former employers and colleagues.
#8 – Ethical Conflicts
Ethical conflicts at work, such as being asked to engage in dishonesty or illegal activities, justify resigning immediately to preserve one’s integrity and avoid potential personal and professional repercussions.
Professionals who feel their personal values strongly clash with the practices or culture of the company may decide that an immediate exit is the only course of action that aligns with their integrity.
For many, this is a valid excuse to leave a job. One of the main reasons for working hard to become financially independent is important.
#9 – Significant Lifestyle Changes
Major life changes, such as getting married, having a child, or needing to care for a loved one, can result in the need for immediate resignation.
Also, choosing to further one’s education is a compelling reason to quit a job without notice, as enrollment opportunities and class schedules often necessitate quick transitions that may not align with traditional notice periods.
Regardless of the significant change happening in your life, you do not have to share all of the details with your employer. You just have to state the bare minimum information.
#10 – Lack of Job Security
Rumors of downsizing or concerns about job stability might provoke an employee to preemptively quit and seek a more secure position elsewhere.
This is not something that should be overlooked. Having a stable job is one of the foundations of being financially sound.
This can serve as a solid justification for resigning without notice. This decision underscores the importance of ensuring your financial and professional security in an unpredictable job market.
What are the best excuses to quit a job you just started without notice?
Quitting a job shortly after starting can be challenging, but certain circumstances can serve as valid reasons for making such a decision.
Here are some of the best excuses for leaving a new job without notice:
Misrepresented Job Role: Discovering that the actual job significantly differs from what was described during the interview process can be grounds for immediate resignation.
Unexpected Life Changes: Sudden personal changes, such as a family emergency or a significant other’s job relocation, may necessitate a quick move that isn’t conducive to employment continuation.
Health Concerns: Onset or discovery of a health condition that precludes one from fulfilling job duties is a compelling reason to leave abruptly.
Hostile Work Environment: Encountering a toxic or hostile work culture, if intense enough, is reason enough to depart without protracted notice.
Superseding Job Offers: Sometimes, a more fitting job offer with immediate start requirements might present itself unexpectedly after beginning a new position.
Ethical or Moral Discomfort: If the organization’s practices conflict with your personal ethics or beliefs to an unresolvable degree, this may justify the quick termination of the employment.
Choosing to quit a job without notice is significant, but when necessary, the above reasons coupled with a tactful approach can mitigate the potential negative impact on your career.
This is something my husband had to decide when a second offer came in after he accepted another position.
Template and Guidelines for Your no Notice Resignation Letter
A no-notice resignation letter should remain professional and succinct, addressing the essential points with respect and clarity. Here are the key components a letter of this nature should include:
Subject Line: If the resignation letter is sent by email, include a clear subject line, such as “Immediate Resignation – [Your Full Name].”
Salutation: Begin the letter with a polite greeting directed at your manager or the appropriate party, like “Dear [Manager’s Name].”
Statement of Resignation: Convey the intent to resign clearly and assertively, stating your position and last day, which will be immediate or as soon as possible.
Reason for Immediate Departure: Briefly explain the reason for leaving without notice. The language should be direct but need not go into personal detail.
Expression of Thanks: Thank the employer for the opportunity to work at the company, and acknowledge the experience and skills gained, regardless of the length of employment.
Offer to Assist: If viable, offer assistance in wrapping up your duties or helping with the transition. Proposals can include preparing handover notes or availing yourself of follow-up queries after departure.
Contact Information: Provide your personal contact details for any future correspondence, including your phone number and personal email address.
Closing and Signature: Close the letter with a professional sign-off, such as “Sincerely,” followed by your typed name and handwritten signature for a printed letter.
Drafting a no-notice resignation letter with these elements allows you to articulate your need to leave promptly while maintaining professionalism and respect toward your employer and colleagues. The objective is to facilitate the transition with as much grace and tact as the circumstances allow.
Sample Resignation Letters for Different Scenarios
Here are sample resignation letters for different scenarios that call for leaving without notice.
Due to Personal or Family Emergency:
Subject: Immediate Resignation – [Your Name]
Dear [Manager’s Name],
I am writing to inform you of my immediate resignation from my position as [Your Position] at [Company Name] due to an unforeseen personal/family emergency that requires my full attention. Please accept my regret that I cannot provide a traditional notice period, and I sincerely apologize for the abrupt timing.
I would like to express my gratitude for the opportunities and support provided to me during my time at [Company Name]. I have learned a great deal and have valued working alongside my colleagues.
Please now, I am available to assist in any way possible to ensure a smooth transition. Let me know if there are specific matters you would like me to address before my departure.
Thank you for your understanding during this difficult time.
It is with regret that I must submit my immediate resignation from my role as [Your Position] at [Company Name], effective [Today’s Date]. Unfortunately, due to recent and unexpected health issues that require urgent and extensive attention, I am unable to continue my duties and provide adequate notice.
I have genuinely enjoyed working at [Company Name], and I am very grateful for the supportive work environment and the professional development I have received.
I will do everything within my ability to assist in the handover process. Please inform me of any priorities that need to be addressed.
Thank you for your consideration, and I hope to remain in touch in the future.
Please accept this letter as formal notification of my resignation from [Company Name] as a [Your Position], effective immediately.
I have recently received a job offer that presents a substantial career opportunity for me and requires an immediate start. After careful consideration, I have decided to accept this offer. I understand that my sudden resignation may cause inconvenience, and for that, I deeply apologize.
I am grateful for the valuable experience and the professional growth provided to me at [Company Name]. It has been an honor to work with such a talented team and contribute to the company’s goals.
To assist in the transition, I am prepared to provide concise documentation and notes on current projects. Please inform me if you require any additional help.
Thank you for your understanding. I wish [Company Name] and my colleagues continued success.
These templates should be adapted to fit your particular situation and to reflect the tone and professional relationship you have with your employer.
Is it OK to resign effective immediately?
Resigning with immediate effect is generally not the preferred protocol and can be a challenging decision to make due to its potential impact on your employer, your team, and your professional reputation.
The common practice is to give your employer two weeks’ notice.
However, it is acceptable under certain circumstances, especially when continuing to work is not possible due to pressing personal reasons, safety concerns, health issues, or other severe conditions.
In the end, while resigning with immediate effect can be OK, it should be regarded as a last resort, utilized when circumstances are such that other options are not feasible.
Now, make sure you have other ways to make money to pay your bills.
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United Bank will consolidate its mortgage subsidiaries into one unified mortgage business amid the housing industry struggles with elevated interest rates.
United Bank has been delivering mortgage services through three channels, including two mortgage subsidiaries — Crescent Mortgage Co. and George Mason Mortgage — and an in-bank channel.
“In an effort to better serve our communities and provide a best-in-class mortgage business, we are consolidating our mortgage subsidiaries into one unified mortgage business. This consolidation will allow us to continue to take care of our customers and promote homeownership throughout our footprint,” a United Bank spokesperson said in an e-mailed response.
As part of the consolidation, Georgia-based Crescent Mortgage will be closing its location and ceasing operations in Atlanta on March 29. The decision was confirmed by Ami Shaver, executive vice president and of head of human resources atUnited Bank, in a letter sent to Georgia’s Office of Workforce Deployment on Jan. 29.
A total of 65 employees will be laid off in March as a result of the Crescent Mortgage closing, according to the letter.
The layoffs at Crescent affected leadership positions, including a chief information officer, chief operations officer, 13 mortgage originators (MLOs), two underwriters and two processors.
Other positions affected by the layoffs were servicing auditors, closing disclosure specialists, auditors and appraisal coordinators.
The National Multistate Licensing System (NMLS)showed that Crescent Mortgage had 29 registered MLOs as of Feb. 1.
Founded in 1993, Crescent Mortgage saw its production drop continuously over the years after peaking at $186.2 million in origination volume across 695 units in 2021, per data from mortgage recruiting platform Modex. Crescent originated $155.7 million across 414 units in 2022 and that volume dropped to $98.3 million across 263 units last year.
United Bank’s spokesperson didn’t confirm whether its other mortgage subsidiary, George Mason Mortgage, will close its operations. George Mason didn’t respond to requests for comment.
Established in 1839, United Bank has close to 250 locations across eight states and Washington, D.C., with total assets of some $30 billion, according to its website.
Income from mortgage banking activities through United Bankshares, the parent company of United Bank, came in at $7.6 million in third-quarter 2023, up from $6.4 million in the previous quarter, according to its 10-Q filing with the Securities and Exchange Commission.
In the first nine months of 2023, United’s income from mortgage banking activity declined to $21.8 million, down from $38.1 million during the same period in 2022.
Most of last year’s top-producing loan officers at Draper and Kramer Mortgage Corp.(DKMC) are not transitioning to the company’s acquirer, New American Funding (NAF), according to multiple sources and available public data.
During their departure, DKMC sales staff who are not joining NAF were informed by leadership that they will have to wait a few months before receiving all of their compensation tied to any loans closed before the M&A deal, per documents reviewed by HousingWire.
California-based NAF on Thursday confirmed the acquisition of the residential mortgage business of Chicago-based Draper and Kramer Holding, a financial and real estate services provider, with the aim to enhance NAF’s presence in the Midwest and along the East Coast. (HousingWire reported on the late-stage negotiations in January.)
“The acquisition will bring a majority of DKMC’s loan originators as well as operations and support staff to NAF and enables NAF to fill existing open roles in various departments with experienced personnel from DKMC,” NAF stated in a news release.
Sources indicated, however, that most of the top-producing LOs from DKMC have decided not to join NAF. This is reflected in data collected by the mortgage tech platform Modex and the Nationwide Multistate Licensing System (NMLS).
A spokesperson at NAF did not respond to a request for comments.
The data shows that 10 of the top 12 LOs at DKMC have either transitioned to other companies or are currently in between jobs.
In total, the production of these originators represented about $424 million last year, a sizable share of DKMC’s total origination volume of nearly $2 billion, according to Modex. NAF, founded in 2003 by Patty and Rick Arvielo, originated $8.4 billion in mortgages in 2023.
According to the NMLS, two top DKMC originators not transitioning to NAF are not licensed with any lender. The remainder transitioned to CrossCountry Mortgage, Synergy One Lending, Capital Bank, First Home Mortgage Corp. and NFM Lending.
A former Draper and Kramer LO who is not joining NAF said that sales staff began leaving in November 2023, and some top LOs announced their transition to other companies earlier in January. He spoke anonymously for fear of retaliation.
“[NAF] is just a different culture of business, and a lot of people don’t like working with a huge company because then they get lost,” the LO said.
Another former Draper and Kramer LO on the East Coast said that even though the list of products and programs at NAF was impressive, he didn’t join because he anticipated another layer of “approvals and bureaucracy.”
“The credit officers on our side and underwriting managers that previously had a large amount of discretion on their decisions, we started to suspect that they would not have final say anymore,” he said. “They’d have to sort of report into the credit officer on the NAF corporate side.“
Founded in 1893, DKMC holds the country’s oldest active Federal Housing Administration license. It will be rebranded as New American Funding.
From Jan. 22 to Feb. 2, DKMC’s active LO count decreased from 170 to 79. Meanwhile, NAF increased its headcount by 68 to 1,952 in the same period, per NMLS data.
Sources told HousingWire that Draper and Kramer Holding’s board of directors pushed for the move, with chief financial officer Jim Hayes serving as the driving force behind the deal with NAF. DKMC President Matt Patterson will be joining NAF, but it’s unclear whether CEO Paul Lueken will be transitioning to the California-based lender.
Compensation
According to a letter the DKMC human resources department sent in late January to sales staff that declined to join NAF, originators will receive compensation for any products funded within 30 days.
Commissions, however, are to be disbursed within a “reasonable timeframe following the expiration of the investor recapture period published on the Company’s intranet,“ the letter read.
In addition, DKMC will also withhold certain costs and fees, including early payoffs and early payment defaults, “that may occur after the termination when calculating the final compensation payment to the Loan Officer.“
Some former LOs said they are expected to be paid in June or July.
“The company said they’re not going to pay you until the early payment default period ends, which is six months,” one of the former LOs said. According to that source, the deferred compensation ranges anywhere from $7,000 to $70,000 per LO, depending on their production.
Early payoff (EPO) fees serve as a means for investors to recoup a portion of their initially projected returns. These penalties are usually imposed on lenders when a borrower pays off their loan within four to six months of closing, but in some cases, it can be up to one year. In turn, lenders charge the EPO fees to their branches and/or loan officers, depending on the company’s structure.
Richard Andreano, practice leader of Ballard Spahr’s mortgage banking group, said that lenders have updated their LO compensation arrangements to make clear the loan officer doesn’t earn the commission when the loan closes but when the early payoff period ends. The Regulation Z loan originator compensation rule does not govern this issue.
“Whether or not compensation must be paid immediately or when the EPO term ends will depend on what is provided for in the employment agreement, compensation plan and/or employer policies that are incorporated into the agreement or plan, and also on state law,” Andreano said.
At least one top-producing DKMC loan officer who did not join NAF intends to explore legal options on the basis of his state’s employment laws, HousingWire has learned.
Two industry veterans said they’ve seen branch managers on a profit-and-loss model wait months to receive compensation but not “regular” loan officers.
“Loan officers earn their income when they fund loans. Maybe they get paid a month later or something like that if they resign,” said one affected former DKMC originator. “But it’s unheard of for them to have to wait over six months.”
Several DKMC loan officers said they were caught off guard about the timeline of the acquisition, even if there had been whispers of a sale for months. DKMC employees weren’t informed until a virtual meeting with NAF sales executives on Thursday, Jan. 18, and the deal closed two weeks later.
“It’s one thing to close a company because you just don’t want to do mortgages anymore. But it’s another thing to keep it from everyone and not give them enough time to really go find a job,” said a former DKMC loan officer on the West Coast. “So, I think that Draper and Kramer made a pretty serious mistake and should have said something potentially six months ago. But the reason they didn’t is because they wanted to make as much money as they could until they sold.”
A 401(k) is an integral part of many people’s retirement strategies. But did you know you may be able to take out a loan against it?
There are plenty of pros and cons associated with this plan. However, it can be beneficial to avoid the loan application process, credit check, and heavy interest associated with many lenders.
It’s a big decision to make, so we’ll walk you through the entire process to help you understand exactly what to expect with a 401(k) loan.
Ready to get started?
What is a 401(k) loan?
If your employer offers a 401(k) to employees as part of your retirement savings strategy, chances are you could be eligible to take out a loan from your contributions.
After all, among both mid and large-sized companies, a full 94% allow 401(k) loans on the money you have contributed. In addition, 73% of these employers also allow employees to borrow money against the employer’s contributions.
So, you can borrow money from your own retirement savings rather than waiting for them to accumulate or paying a 10% penalty tax as you would with a traditional IRA.
Eligibility Criteria for a 401(k) Loan
There are a few restrictions surrounding a 401(k) loan. While we mentioned that many larger companies typically allow you to borrow for your account, not all do. You can find out about your workplace policy by referencing your employee handbook or contacting the human resources department.
You also must still be working at the company where you had your 401(k) to take out a loan. So if you left willingly or were fired, unfortunately, you aren’t able to take advantage of this opportunity.
There are also some limits on how much you can borrow from your account. IRS regulations state that you can only borrow the smaller of the following two options:
$50,000 or
Half the amount of your vested account balance
Your interest rate is also determined by when you borrow. That’s because it’s typically set at the prime rate plus an extra 1% to 2%. So if the prime rate is at 4.25% and your employer’s 401(k) plan adds 2%, you’re looking at a 6.25% interest rate. The interest does, however, go directly back into your retirement account.
Benefits of Borrowing from Your 401(k)
Like any financial product, the 401(k) loan comes with both pros and cons. Some experts scream that you should never touch your retirement savings, while others have noted countless success stories.
It’s essential to weigh the positives and negatives concerning your situation thoroughly. Then, you can make a fully informed decision on whether a 401(k) loan is right for you specifically.
Being your own lender comes with a few perks.
Easy Approval
First, you don’t have to fill out an application. There’s no underwriting process since the funds are already in your name. You also don’t have to worry about any type of minimum credit score.
So if you need an infusion of cash for some reason but have gone through a rough financial patch, you can sidestep a bad credit loan and the accompanying bad credit.
Repayment Terms
Repaying a 401(k) loan involves direct deductions from your paycheck, which reduces your take-home pay. For example, a monthly repayment of $200 will decrease a $3,000 take-home pay to $2,800. It’s important to budget with this reduced income in mind.
If repayments are missed, the loan may default. The remaining balance then becomes a taxable distribution, potentially incurring a 10% early withdrawal penalty if you’re under 59 ½. This could significantly raise the loan’s cost.
Remember, while repaying the loan, the borrowed funds aren’t earning investment returns, impacting your retirement savings growth. Consider these factors carefully to understand how a 401(k) loan fits into your financial planning.
Use of Loan Funds
401(k) loans offer flexibility in how you can use the borrowed funds, whether for home repairs, education, or debt consolidation. However, it’s crucial to use this money responsibly. Since these funds are part of your retirement savings, using them for non-essential expenses can jeopardize your financial future.
Consider the long-term implications before diverting retirement savings for current expenses. It’s wise to reserve 401(k) loans for situations that contribute to your financial stability or urgent needs, rather than discretionary spending. Misusing these funds can lead to a shortfall in your retirement account, affecting your financial security in your later years.
Lower Interest Rate
Borrowing from your 401(k) typically offers a lower interest rate compared to credit cards or personal loans. This can be a cost-effective borrowing option, especially if you’re facing high-interest debt. However, consider the long-term impact on your retirement savings when opting for a 401(k) loan.
Drawbacks of Borrowing from Your 401(k)
It’s important to consider both the short- and long-term impacts of taking money out of your 401(k).
Double Taxed
Double taxation on a 401(k) loan can be confusing. Essentially, when you repay the loan, you do so with after-tax dollars. This means the money you use for repayment has already been taxed as part of your income taxes. Later, when you withdraw from your 401(k) in retirement, you are taxed again on these funds.
For example, if you pay $1000 back into your 401(k) as loan repayment, this $1000 has already been taxed as part of your salary. When you retire and withdraw this money, it’s taxed again as income.
Further Contributions
You also may not be allowed to continue making retirement contributions during the repayment period. It depends on your employer’s plan. During this process, your retirement nest egg could suffer.
First, you’d lose any gains made on the funds you took out. Then, you’d be taking a hiatus for at least a few years. That can really add up when you think about compounding gains.
Leaving Your Job Could Accelerate Loan Repayment
If you leave your job, voluntarily or not, while a 401(k) loan is outstanding, the remaining balance often becomes due within 60 days. This can create a significant financial burden, especially if the loan amount is large.
Plan carefully and consider the stability of your current employment situation before taking a 401(k) loan, as unforeseen job changes could lead to challenging repayment demands.
Financial Penalties from Defaulting on a 401(k) Loan
Failing to repay a 401(k) loan can lead to significant financial consequences. If you default, the unpaid balance is treated as a taxable distribution. For those under 59 ½, this also incurs a 10% early withdrawal penalty.
These penalties, combined with the owed taxes, can substantially increase the cost of the loan, impacting your current financial health and diminishing your retirement savings.
Repayment Process: How to Manage Your 401(k) Loan
If you decide to take out a 401(k) loan, make sure you understand how the loan repayment process works. Your loan payments are taken directly out of your paycheck, but there is a certain degree of risk involved. If, for some reason, you can’t (or simply don’t) make a payment for 90 days, you’ll incur significant penalties.
It’s almost considered to be a short-term default because you’ll pay taxes on it and the 10% early withdrawal penalty on the amount owed.
When you take out a 401(k) loan, you don’t have to pay any type of application fee or origination fee, so it seems like a low-cost option. But again, you have to consider the money you’re losing by not having as much invested in your account.
A great way to analyze the numbers is to use a retirement calculator. You can figure out how much you’d have to sacrifice to get your loan funds right away, and then decide whether it’s worthwhile.
Is a 401(k) loan right for you?
This is a personal decision, and there are many factors to consider regarding whether a 401(k) loan is a good idea. First, think about how far away you are from retirement. If you’re expecting to start making withdrawals in the near future, you may want to reconsider dipping into that money ahead of schedule.
If you’re further away from retirement, you have more time to make up for any financial losses you’d incur while the loan is out. Just make a plan to ensure you’re able to catch up over time.
Of course, your intended use for your 401(k) loan funds also affects whether it’s a good choice. Short-term uses are a little less worrisome. For example, if you’re using it for a down payment on a house and can quickly repay the loan, it can be a good way to avoid those penalties.
But if you’re using the 401(k) loan as a band-aid during an ongoing financial downturn, you may want to think again. Is it really solving the problem or just providing temporary relief?
Furthermore, think twice about using your 401(k) loan to pay off debts. If you’re still in financial trouble, you can lose your existing assets.
But retirement savings are typically protected from any kind of insolvency, but not if they’ve been taken out as a loan. If there’s a chance you might lose the money permanently, try to find another solution.
Alternatives to Using Your 401(k) for a Loan
A 401(k) loan isn’t the only alternative to a traditional personal loan. Here are a few other options to consider.
Emergency Savings
Ideally, you have accessible cash set aside to use in the case of a financial emergency. Most experts recommend at least six months of income to tide yourself over. Just make sure any use of this money truly is for an emergency.
Home Equity Loan
Home equity loans are for people who have a fair amount of equity in their homes. It’s essentially a second mortgage, but the repayment term lasts a much shorter period. The pro is that the interest you pay on the loan is tax-deductible.
401(k) Taxable Withdrawal
Here’s another way to utilize your 401(k) funds. Instead of taking a loan, you may be able to take out a hardship withdrawal. If you’re using the money for medical needs, you may be able to avoid the 10% penalty, although you’d still have to pay income taxes on whatever you take out.
IRA 72(t) Withdrawal
IRA 72(t) withdrawals offer an alternative to borrowing from your 401(k), especially for those with substantial IRA funds. Under IRS Rule 72(t), you can take early, penalty-free withdrawals from your IRA, provided the withdrawals are part of a series of substantially equal periodic payments (SEPPs). These payments must continue for 5 years or until you reach age 59 ½, whichever is longer.
This option requires careful calculation, as the SEPPs must be based on one of three IRS-approved methods. It’s important to note that once started, the 72(t) payments must be taken as scheduled, and any deviation can result in retroactive penalties. Consider consulting a financial advisor to understand how these withdrawals could affect your long-term retirement savings and tax situation.
Bottom Line
Deciding on a 401(k) loan involves balancing immediate financial needs with long-term retirement goals. While it offers immediate liquidity and potentially lower interest rates, the impact on your future savings and the risks associated with job changes and loan defaults must be carefully weighed.
Financial planning is a dynamic process, requiring you to consider both present circumstances and future aspirations. A 401(k) loan can be a strategic tool in your financial toolkit, but it demands careful consideration and thorough understanding of its terms and consequences.
Before proceeding, explore all financial options, assess the stability of your employment, and consider seeking advice from a financial advisor. The key is to make an informed decision that aligns with both your immediate financial needs and your long-term retirement objectives.
Frequently Asked Questions
How do I take out a loan from my 401(k)?
Most 401(k) plans allow you to borrow up to 50% of your vested account balance, up to a maximum of $50,000. You will need to fill out a loan application and provide documentation of your loan purpose and repayment schedule.
What are the repayment terms of a 401(k) loan?
Repayment terms vary by plan, but you are typically given 5 years to repay the loan. However, if the loan is used to purchase a primary residence, the repayment period can be extended to 10 years. You must make regular payments that include both principal and interest.
Does taking a 401(k) loan affect my credit score?
No, a 401(k) loan is not reported to credit bureaus and therefore has no direct impact on your credit score. However, it’s important to manage these loans responsibly as they can affect your long-term financial health.
Are there any penalties for defaulting on a 401(k) loan?
Yes, if you default on a loan from your 401(k) plan, you will be subject to taxes and penalties on the amount of the loan.
Can I take a 401(k) loan if I already have an outstanding loan from the same plan?
This depends on your plan’s rules. Some plans allow multiple loans, while others restrict the number of outstanding loans. Check with your plan administrator for details.
Are there any restrictions on how I can use the money from a 401(k) loan?
Yes, most plans restrict the use of loan proceeds to specific purposes, such as purchasing a primary residence or paying for college tuition and expenses.
Can I make extra payments on my 401(k) loan?
Yes, you can make extra payments on your 401(k) loan. This can help you pay off the loan sooner and reduce the amount of interest you pay.
What happens if I cannot repay my 401(k) loan due to financial hardship?
If you face financial hardship and can’t repay your loan, it may be considered a distribution and subject to taxes and penalties. It’s crucial to consider this risk before taking a loan.
Names in the News: People shaping the future of Lake Area business
Published 11:16 am Sunday, January 7, 2024
Maddox joins Memorial Health
Lake Charles Memorial Health System is pleased to welcome plastic and reconstructive surgeon Dr.Suma Maddox to its medical staff.
Maddox, MD FACS, is a double board-certified plastic surgeon specializing in aesthetic and reconstructive surgery.
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She began her training with a bachelor’s degree in neuroscience from New York University and an MD from Louisiana State University School of Medicine in New Orleans, followed by a residency in general surgery at Brown University.
Originally from Houma, Maddox returned to her home state in 2014 to work as a general and breast surgeon at Ochsner Medical Center in New Orleans.
The four years as a staff surgeon were pivotal in inspiring Maddox to seek more creativity in her career. Realizing her talent for oncoplastic breast surgery, in which cancer is removed and the breast artistically reconstructed for optimal aesthetic results, Maddox decided to pursue a new path of plastic surgery. After nine years as a general surgeon, she made the uncommon decision to resume training with a three-year fellowship at Louisiana State University in New Orleans in plastic and reconstructive surgery, focusing on microsurgery and breast cancer reconstruction.
Home Furniture expands locations
COVINGTON — Home Furniture Plus Bedding, a leading provider of high-quality home furnishings, mattresses, and decor, is thrilled to announce the upcoming opening of a new store location in Covington, slated to open its doors in 2024.
Located at 70427 La. 21, the new store will mark an exciting expansion for Home Furniture Plus Bedding, offering an extensive range of furniture collections, premium mattresses, and home accessories to meet the diverse tastes and needs of the Northshore community and surrounding residents.
The new store will showcase the latest trends in home decor, featuring a wide array of furniture options including living room sets, bedroom suites, dining room ensembles, mattress collections, and more.
Ochsner Health recognized
Ochsner Health has been included in the 15th annual Gartner Healthcare Supply Chain Top 25 ranking, which recognizes U.S. health systems setting the standard for supply chain excellence.
Ochsner is an integrated healthcare system operating 46 hospitals and more than 370 health and urgent care centers across Louisiana, Mississippi, Alabama and the Gulf South. Its cutting-edge Connected Health digital medicine program is available in all 50 states, serving members, health plans, and employers nationally.
The Gartner Healthcare Supply Chain Top 25 ranking is determined by both quantitative measures and expert opinion. Quantitative measures show how companies have performed in the past and establish connections between financial health, patient care quality, ESG and supply chain excellence. The opinion components offer a qualitative assessment of value chain leadership and evaluate supply chain performance.
Health systems recognized as leaders in supply chain are those advancing the digital supply chain and attracting and retaining talent in supply chain.
Cormier graduates from Leadership SWLA
CSE Federal Credit Union is proud to announce Chief Human Resources Officer Kasey Cormier has graduated from Leadership SWLA within the class of 2023 through The Chamber SWLA and SWLA Alliance Foundation.
Leadership SWLA is a program created by The Chamber SWLA and the SWLA Alliance Foundation to develop future leaders in Southwest Louisiana. Each year, around 30 individuals from various sectors are selected to receive training from recognized leaders in areas that impact the region.
Cormier joined CSE in 2008 and notes that one of the keys to her success is building professional relationships within the working environment at CSE and within the community.
She is a Southwest Louisiana native who graduated from McNeese State University and worked in the financial industry for 15 years. In addition, she is certified in Professional Human Resources through the National Human Resources Institute, certified as a National Human Resources Professional through Society for Human Resources and certified in National Human Resources Management. She is a member of the Calcasieu Parish 4H Foundation Advisory Council, Society for Human Resources Management and Imperial Calcasieu Human Resources Management Association.
Roath joinslaw firm
Sigler, Arabie & Cannon of Lake Charles is pleased to announce that Cassidy M. Roath has joined the firm as an associate.
Roath’s primary practice areas are real estate, succession administration, and business law. She graduated from the University of Georgia in 2019 with a Bachelor of Arts degree in political science. She received the degree of Juris Doctor in 2023 from Loyola University New Orleans College of Law, where she graduated cum laude and was a member of the Moot Court Board.
Roath was admitted to the Louisiana bar in 2023, and is a member of the Louisiana State Bar Association and Southwest Louisiana Bar Association.
Grad program has new leaders
Dr. Twila Sterling-Guillory is the new leader of the graduate nursing program at McNeese State University. Previously, she was the Master of Science in Nursing coordinator. She earned her doctorate degree from Southern A&M University in 2011. Sterling-Guillory joined the McNeese faculty in 2004 and is a family nurse practitioner for Christus Hospice.
Dr. Deanna Harless is stepping up as the new MSN coordinator. She earned her doctorate degree from Southeastern Louisiana University in 2016 and joined the McNeese faculty the same year. Harless is also a nurse practitioner at Geriatric Resources Inc.
Harless began working as a nurse practitioner in 2000 and witnessed her mentor, the doctor she worked with, teaching his nurses and patients. She found herself teaching others, too. When she had to slow her own practice down, colleagues from McNeese reached out to see if she had an interest in teaching.
Dr. Sara Jones is the coordinator for the DNP program. She earned her doctorate in nursing at the University of Arkansas for Medical Sciences in 2010.
Dovenmuehle Mortgage, a mortgage sub-servicing company, has informed authorities in Illinois that it will impose a layoff affecting hundreds of employees next year.
The company has decided to cut 212 jobs in its Lake Zurich site starting on Feb. 16, 2024, per a Worker Adjustment and Retraining Notification Act (WARN) filed with the Illinois Department of Commerce and Economic Opportunity.
“This action is a partial reduction in the company’s workforce at the site above; the company intends to continue operations at this site; this action is expected to be permanent,” Lisa Herrmann, assistant vice president of human resources at Dovenmuehle, wrote in the document sent on Dec. 14 to the state authority.
A spokesperson for the company wrote in an emailed response to HousingWire that, as a private company, “Dovenmuehle does not comment on internal matters, including workforce details.” The spokesperson did not provide more details, such as the reasons for the workforce reduction and the jobs affected.
However, higher mortgage rates this year led mortgage origination volume to decline to $1.6 trillion, compared to $2.2 trillion the previous year, according to the Mortgage Bankers Association (MBA). Volumes are expected to increase 22% in 2024 to $2 trillion.
Dovenmuehle, founded in 1844, provides a private-label mortgage sub-servicing solution, per its website. It is a sub-servicer for commercial banks, credit unions, independent mortgage lenders, MSR investors and state housing finance agencies nationwide.
Its services include portfolio, government, and Fannie Mae and Freddie Mac loans.
In September, it appointed Robert Howerton as chief information officer to oversee the company’s IT infrastructure. Before joining Dovenmuehle Mortgage, Howerton was IBM’s leader platform security engineer.
Phone interview questions often cover a lot of ground, from your professional motivations to your preferred style of being managed. Phone interviews also typically include several behavioral questions, too, in which you’re asked to recount specific experiences from your previous jobs.
They can seem intimidating, but phone interview questions are a lot less scary when you’ve rehearsed your answers and prepared stories that demonstrate your strength as a candidate.
Below, you’ll find 20 questions commonly asked during phone interviews, as well as advice on how to best answer them.
Phone interview questions
In preparing for your phone interview, set aside a few hours to reflect on how you’d answer each question. Write or type out your answers, then practice answering each question out loud.
Focus on speaking slowly and clearly, and run through your answers several times — that’ll help you eliminate filler words and speak comfortably when you’re talking to the interviewer.
When you’re on the phone interview, smile while speaking, recommends Robert Half, a human resources consulting firm. Even though the interviewer can’t see you, you’ll sound more enthusiastic and confident.
You can also keep a cheat sheet with key dates, sales figures or other information you want to easily access. Don’t overly rely on them, though, and be prepared to complete the interview without having to visit your notes.
Question about the company or position
1. What are your qualifications for this position?
If you’re asked this question, talk about your hard skills or competencies learned through training or education, says Heather Livingston, a career advisor at University of Phoenix.
Bring up any specific qualifications you have that were in the job description. Such qualifications might include knowledge of a specific software, coding language or experience working with a certain type of customer.
Be sure to mention any professional certificates or licenses relevant to the position, too, Livingston says. You can also mention any college courses or professional training you’ve completed that relate to the role.
2. Why do you want to work for us?
To effectively answer this question, you’ll need to research the company, Livingston says. Familiarize yourself with its history, mission statement, purpose and leadership.
Mention explicit parts of the company’s mission that you agree with, and how helping the company achieve that mission aligns with your overall career goals.
3. What do you know about the company?
Similar to the question above, you’ll need to research the company to answer this question. Spend some time on the company’s website and read the “About Us” page. You can also visit the company’s LinkedIn page and see if it’s recently been in the news.
You don’t need to memorize every part of the company’s history, but make sure you’re aware of any major events — such as mergers, acquisitions or product launches — and can speak confidently about the company’s main product or service.
4. What do you see as the biggest challenge coming into this role?
It can be tough to answer questions that require you to admit your vulnerabilities. But employers know that even the best employees inevitably struggle with one or more aspects of any job.
“The key is to be honest,” Livingston says.
There’s a fine line between being honest and undermining yourself as a candidate, though. Avoid mentioning challenges that relate to critical components of the job.
For example, if you struggle with time management, and the job requires you to manage multiple deadlines, sharing that struggle might give the hiring manager pause. Similarly, sharing that you aren’t detail oriented might not be a great idea if you’re interviewing for a data-focused role.
On that note: If several key parts of the job sound like significant challenges, do some soul searching and think about whether the job is a good fit for your skillset.
Also, offer solutions to any potential challenges you foresee, Livingston says. If you tell the interviewer you might find a particular software challenging, for example, share your plan for overcoming that challenge.
5. Why should we hire you?
This can be a tricky question to answer; you want to sell yourself, but don’t want to appear cocky or entitled. Write and practice an elevator pitch for yourself as a candidate, Jennifer Preston, an HR consultant, told U.S. News and World Report.
Highlight your work experience that most closely aligns with the role and your strongest skills related to the job. Talk about the job objectives you’re most excited to accomplish, and tell the interviewer how you’d achieve those goals.
You can also mention the little things that distinguish you from other candidates, too — whether that’s your passion for building relationships or your long-term career goals that make you a good fit for the company.
Behavioral questions
6. Tell me about a tough decision you’ve had to make in the past.
Behavioral questions are designed to predict a candidate’s future job performance, according to the Journal of Business Research. So, for this and the remaining behavioral questions, answer with a workplace anecdote that illustrates how you behave in certain situations.
Think about difficult decisions you’ve made on the job. Have you ever been asked to mislead a customer? Has a manager ever acted inappropriately, leaving you to decide whether to report them? Share a story that shows your integrity, work ethic or another quality that makes you a desirable employee.
7. Tell me about a time you failed.
This question isn’t meant to highlight your failures or mistakes. Instead, it’s a chance for the interviewer to see whether you learn from your mistakes, Livingston says.
“Failure is how we learn. And good employers, good bosses and good managers know this,” Livingston says. “Nobody’s perfect.”
Don’t be the candidate whose biggest failure is that they care too much. Be honest and candid, and talk about a genuine error you made on the job.
Avoid dwelling on the mistake itself — or the panic and consequences that followed — and instead emphasize the insights you gained, and how you grew from the experience, per the Harvard Business Review.
8. Tell me about a time you didn’t get along with a coworker or colleague.
The interviewer knows that nobody gets along with every person they encounter. They’re trying to see if you’re able to work with people you don’t particularly like, Livington says.
Don’t spend too much time explaining why you disliked a particular colleague. Focus on how you were able to put your differences aside and accomplish the task at hand.
9. Tell me about a time you had to work under pressure or stress.
Can you handle the heat, or do you collapse under pressure? That’s what the interviewer is trying to determine.
Talk about a time when you worked under tight deadlines or external stress. Specifically list the ways you handled that stress, whether it was by staying organized, building small mental health breaks into your day or eating well and getting plenty of sleep during busy weeks.
10. Tell me about a time when you took initiative.
Finally, an opportunity for a positive story! Share an instance in which you proactively completed a task or contributed to a project — ideally, without being instructed by your manager — that benefited your employer or made things easier for your team.
Work style questions
11. Do you prefer working on a team or alone?
There’s no right or wrong answer to this question. But given that most jobs involve some form of collaboration, your answer should make it clear that you’re able to work on teams, according to the Harvard Business Review.
You can also list the instances in which you prefer working alone or collaboratively, recommends the Harvard Business Review. For example, you could say that you love brainstorming ideas and developing sales pitches with your colleagues, but enjoy the freedom to work independently when on a deadline or during certain chunks of the day.
12. How do you manage stress to avoid burnout?
The interviewer isn’t looking for a specific method of stress management; they’re just making sure you know how to handle stress and won’t crumble under tight deadlines.
Share a work experience that illustrates how you effectively manage stress, recommends the Harvard Business Review. Feel free to get specific: If you utilize tools like meditation, journaling or morning runs to manage day-to-day stresses, say that.
13. How would people you’ve worked with describe you?
To effectively answer this question, first consider the qualities that might make someone successful in the role you’re interviewing for.
If the job requires a lot of collaboration, for example, say that your coworkers would describe you as communicative, accountable and a team player. If the job involves number-crunching, you could say that your colleagues would call you detail-oriented and conscientious. Think of past experiences you can mention that illustrate those qualities in action.
You can also use this question to highlight a few of your unique characteristics that aren’t directly tied to the role. Knowing that your coworkers would describe you as personable or funny, for example, can paint a more well-rounded picture of you as an employee.
14. What kind of management style works well for you?
Like many of these questions, you’ll want to answer honestly while keeping things relatively broad. Make it clear that you can work effectively under any manager, according to multiple career experts.
For example, instead of saying, “I prefer to work under managers with a hands-off leadership style, and can’t work well if my boss is always looking over my shoulder,” you could say, “While I prefer a hands-off managerial style, I’ve worked well with plenty of supervisors who prefer frequent check-ins and close collaboration.”
15. What are you passionate about? What motivates you?
Are you externally motivated by rewards, growth opportunities or bonuses? Or are you intrinsically motivated by doing work you believe in? Reflect on what motivates you in the workplace and honestly answer the question. You want your employer to understand what motivates you, according to BetterUp, a behavioral career coaching company.
To kickstart your reflecting, here are some potential motivators:
Promotions and leadership opportunities.
Contributing to a team.
Solving problems for customers and clients.
Learning new things.
Developing certain professional skills.
Making a difference.
“You can be passionate about things in your personal life, but whatever this answer is should show relevance to how it will enhance your success at this position in this company,” Livingston says.
16. What is your experience with remote work?
This question may not be relevant to you, depending on the job you’re interviewing for. But if you’re interviewing for a remote role, the employer may want to know if you can effectively manage your time and responsibilities.
Describe your experience with remote work — or lack of experience, if you’ve never worked from home — and make it clear that you can perform the job’s functions without reporting to an office or workplace.
Logistical questions
17. Are you currently employed, and why are you thinking about leaving your current job (or why did you leave your previous job)?
This can feel like a tricky question to answer. The key is to answer honestly without getting into too much detail. Saying that you’re looking for a job that better aligns with your goals, values and growth plans is typically a safe bet, Livingston says. Be prepared to talk about those goals and values, as the interviewer may ask follow-up questions about them.
Don’t badmouth anyone from your previous employer, though. It’s an unprofessional look. If you quit your job (or are planning to leave) because you don’t get along with your manager or another coworker, keep things broad, Livingston says.
“Say something very general to the effect of having different values and different goals,” Livingston says. “That way, you’re not saying something bad about the previous employer or manager. You never want to do that.”
18. Are you interviewing with other companies?
Most candidates in the job market are applying for and interviewing with multiple companies. If you’re interviewing with other companies, you should feel comfortable sharing that, Livingston says. You don’t need to mention which companies or roles you’re interviewing for, though.
Also, be sure to emphasize your excitement for the role you’re discussing with the interviewer. You can say something like, “At this time, I am interviewing for other positions, but this is the role that best aligns with my interests and career goals.”
19. What salary range are you looking for?
There are a few ways you can answer this question.
First, you can provide an ideal salary range. To avoid giving a range that’s unrealistically high (or lower than you could get), research salaries for similar positions in your industry and city. Then, provide a salary range with around $10,000 of wiggle room, Livingston says. If your ideal salary is $75,000, tell the interviewer you’re looking for compensation between $75,000 and $85,000.
If you’d like to buy some time before sharing an ideal salary, another option is telling the interviewer that you’d like more information on the role, according to U.S. News & World Report.
You could say something like this: “Until I learn more about the job and its responsibilities, I’d rather not decide on a fair salary range. Could we discuss compensation at a later date, perhaps after I’ve spoken with other members of the team?”
When you do share an ideal salary range, ask for more money than you’re currently making. Changing jobs is often an effective way to significantly increase your salary.
Half of the American workers who switched jobs between April 2021 and March 2022 saw their wages increase 9.7%, according to a July 2022 Pew Research Center report. Meanwhile, the median worker who stayed in their job over that same period saw their wages fall 1.7%.
20. When can you start working?
Ideally, you want to give your interviewer a firm date. But if you’d have to submit a two weeks’ notice at your current job, simply tell the interviewer that.
Say that, out of respect for your employer, you’d like to help transition your responsibilities and complete any outstanding tasks before your departure. In most cases, the new employer will be fine with figuring out a start date later in the interview process.
Working with a recruiter can speed up a sluggish job search and help you find roles that aren’t listed publicly.
Here we’ll discuss, with templates, how to reach out to a recruiter on LinkedIn. We’ll also cover how to find a promising recruiter on LinkedIn and in other ways.
1. Prepare to pitch a recruiter
Before contacting a recruiter, update your resume, cover letter and LinkedIn profile. Also practice articulating your accomplishments and certifications, suggests Jauné Little, director of recruiting services at Insperity, which sells human resources services to companies.
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Depending on their industry, recruiters are often managing dozens of candidates and open positions, and sifting through hundreds of job applications. So Little also suggests identifying skills or experience you have that other candidates don’t. That might look like experience at a massive company in your industry, a unique degree or an unconventional work history.
Practice spelling out that distinction, and think about how you’d talk about those attributes to a recruiter.
“You really have one shot at making a lasting impression,” Little says. “So make it a good one.”
2. Find a recruiter on LinkedIn
To find recruiters on LinkedIn, search “recruiter” alongside your desired industry or job in the search bar. If you can, get specific; a search for “medical devices sales recruiter” will offer better results than “sales recruiter.”
You can also search for recruiters by city and company; for example “Dell recruiter” or “Oklahoma City recruiter.”
To filter your search results to only people’s profiles, click the “People” button at the top of the search results. Scan the results carefully; if you search “Lyft recruiter,” for example, some of the profiles in your search results will belong to former employees who list Lyft on their profiles.
3. Reach out to the recruiter on LinkedIn
Once you find a recruiter, request to connect. LinkedIn doesn’t allow users to directly message people they aren’t connected with, but you can include a message in your connection request.
Keep your message short and simple. Recruiters are busy people; if your message is too long, they’ll often skip it entirely.
“Iheard a recruiter from Google say that the worst thing he sees on a resume is a text brick,” says Lisa Severy, a career advisor at University of Phoenix.
Here’s an example of what you could include in a LinkedIn connection request:
Hi, [name]. I hope this finds you well. I’m a [position] with [X years] experience in the industry, and am based in [city]. I’m searching for opportunities to [get specific; list what jobs you’re interested in, or what industry you’d like to work in]. I’d love to connect and discuss this further with you. Thank you!
4. Follow up with your resume and another message
If the recruiter accepts your connection, you’re then able to directly message the recruiter. If you included a message in your LinkedIn connection request, wait a day before sending them a direct message.
Attach your resume to your message. Keep your message straightforward and to the point. It should look something like this:
Hi [name],
Good to connect with you! My name is [name], and I’m a [position] in [city] looking for new opportunities [in industry or at a specific company].
I have [X] years of experience in [your industry]. [Include 1-2 sentences listing your accomplishments, certifications or unique job responsibilities that distinguish you from other candidates.]
I’d love to chat with you about any open positions for which I may be a good fit. Are you available on [date] for a phone call?
Thank you,
[your name]
Once you’ve sent your message, give the recruiter a few days before following up with another message. If your second message goes unanswered, it’s probably best not to follow up again.
There’s a good chance that’ll happen to you, and it’s not personal — Severy warns candidates that a lot of messages to recruiters will go unread. That’s why it’s a good idea to reach out to several recruiters. It’s a numbers game. Eventually, you’ll find your match.
Other ways to reach out to recruiters
Experts agree that, in most cases, the easiest way to find a recruiter is on LinkedIn. If you don’t have a LinkedIn profile, get one, and use these tips to make a compelling page.
Not having a LinkedIn profile these days is “questionable,” Little says.
If you don’t want to use LinkedIn, search online for recruiting agencies that focus on your industry. It may be harder to find an individual recruiter’s contact information that way, though.
Additionally, check a company’s job listings to see if a recruiter’s contact information is listed on the postings.