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Launched "new" Ask All About Money

I just launched a new Q&A section only for money matters similar to Yahoo! Answers. Our motto, no question is silly or dumb when it comes to money matters. We all have questions time and time again about money matters and this is a simple platform to ask them.

If you are a guru/expert in any money related areas, we could use your help from your contributions by answering questions.

Don't forget to check out our new Q&A section at Ask All About Money

unemployment

COBRA Subsidy - Is it helping?

It has been 4 months since Mr. Obama signed the Stimulus bill and made American Recovery and Reinvestment Act of 2009 in Feb 17, 2009. It encapsulates number of tax incentives, extension of unemployment benefits and more bail out options. Many of those incentives and benefits are still not properly adapted and implemented by the concerned parties due to the lack clarity in the process. I talked about the incentives in my previous blog post. In this blog post, I am interested just about the unemployment benefit extension, COBRA Subsidy program which I hear many unemployed people are having tough time getting credit. 

Like Home Mortgage Modification plan when many lenders were hesitant to signup because of the complex process which is creating borrower anxiety. COBRA subsidy also fall under same category where streamlined process is not in place and employers were still looking for more instructions the government to implement.

When  announced, it was meant to help unemployed workers by reducing their burden of paying health insurance upto 65%. Is it really helping? That's a question to be answered by Obama office and we won't go there. I did some research and collected details on COBRA subsidy to post this blog with facts and figures.

What is COBRA?

If you are laid off, you should be aware of COBRA. Employers are required to offer COBRA by federal law to let the employee keep their health insurance plan when they lay off. If you aren't aware and don't remember employer offering this option, please contact your employer immediately. The coverage typically is available for 18 months but employee will end up paying the full insurance premium(with no employer discount) plus 2% admin fee.

It is an expensive coverage but helps in great extent for individuals who may not be able to obtain new coverage due to preexisting conditions. If you paid for $300 as a health premium for your family, you will end up paying $1000 + 2% fee apx when accept the COBRA coverage after you are laid off.

COBRA Subsidy

Under the new ARRA 2009 act, the subsidy will cover 65 percent of premiums for nine months. There are some caveats as usual. The subsidy will apply to premiums paid for periods of COBRA coverage beginning on or after February 17, 2009. It doesn't do any good for self employed who has their own individual health insurance plans.

For more details, check it out at irs.org

Does it really helps?


Many people are just getting by an average unemployment weekly benefit of merely $300- $350. With COBRA, people need to pay 100% of premium + 2% fee, cost comes around $900-$1200 per month for a reasonable plan. U
nder the new bill considering the subsidy, they're still looking at spending close to $400 - $500 a month out of their pocket. It helps but not to a great extent. People are going to have to think long and hard about whether they can afford to extend their coverage under COBRA.

Loop Holes and Hassles

After reading comments from people on different sites, I summarized this section to bring to attention about some holes and hassles which is creating lot of frustration.

1. You might end up paying 35% of the premium from the day when you are laid off or lost your medical coverage not when you sign up for COBRA. If you lost the job in March and signed up COBRA in Jun 2009 because of process delay or any reasons. You still end up paying premium from the day you lost your medical coverage.

2. It can take months until you get information about COBRA subsidy from your employer. Be prepared to shell out 100% premium for those months which can be refunded or credit back as soon subsidy kicks in.

Help Available

I also found these information for people who are waiting for COBRA to kick in. If you don't have COBRA yet, during emergency, a county hospital will take you in. You will get a bill, but once the subsidy comes in, you can submit the claim to your COBRA carrier to get it refunded. 

For prescription, You can try PPA - Partnership for Prescription Assistance. Go to their website, see if your Rx is on their formulary, if they are, download and fill out the form, have your Doctor complete the rest and mail it in to the address on the form. You should get an answer within 30-days for free or low-cost Rx drugs until you get your insurance.

Check out the lastest update about the COBRA subsidy posted on  U.S. Department of Labor website
. For more questions, you can also call their hotline at 866.444.3272(no charge).

Families USA, a non-profit healthcare advocacy group, has posted a page with detailed information about the subsidy.

More Resources

8 questions about COBRA Subsidy
www.retirementrevised.com

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Job loss - Survive & Succeed

These are tough times to many families and individuals. Millions of jobs have been lost in the past year or so leaving many people depend just on their unemployement insurance to support their families. I know how hard it is without a job if only one person brings home the bread. I have experienced myself. It gets even tougher for self employed who can't even claim the unemployment insurance. 

Some what of a good news is , it has slowed down quite a bit in the past month or so. Obviously, it has to slow down because companies can't throw out every body otherwise they cannot survive. Also slowing of layoff's doesn't means jobs are getting created.  It just companies reached a saturation point stripping down so much and they cannot do anymore job cuts. 

Many youngsters who never faced this kinda recession is facing tough times handling this current situation. First off, it is really hard to take it in when you get laid off after working  your butt off(excuse my language) for the company.

You tend to think, they will call you back again. No, they are not going atleast for a year. They just moved on without you so you should consider moving on too.  It sucks practicaly but you shouldn't loose hope and lose heart. Things change and you should change as well and continue your path to persue your dreams.

This blog might seem bit late but it is not. I intentionally want to wait and weigh in on the options so I can give some useful pointers from my experience. It is easy to just make a blog copying from other websites but I don't want to do that(I never do that) because Jobloss is a tough one and I want to share the same feelings when I talk about it.

So here go my 5 good Survival tips which might help you.

1. Unemployement Insurance - If you previous employed (not self employed), you are eligible for unemployment insurance from your state. If you havn't claimed it, go ahead and do it. You are wasting the money you are eligible to get since your employer paid for it. Sorry self employed folks, we don't have this liberty and I know it sucks.

2. Cut all your unwanted expenses. Whether you used to go to movies every week or restaurant for family dinner, just think about cutting it for a while. It will help to survive with your funds for longer time until you find a good job.

3. Just say to yourself "I can't afford at this time" if you and impulse buyer. These strong words will help you stay away from things which you really don't need to survive at this moment.

4. Don't dip into your credit card and make things worse. Use your emergency funds which is especially meant to tackle this situation. Especially self employed like me, you should have atleast 6 months of built up funds to take care of this jobless period.

5. Exercise and Hobbies - Try not to keep thinking about the lost job. It will let you down and you won't be able to attend interviews propertly. Add a positive attitude and go to Gym to catch up on your work out schedule. Try to spend time on your hobbies or passion to invent yourself and reenergize your thoughts. It will sure come handy during interviews.


Here is my 5 Success Tips which might help you to get out of the loss.

1. Leave no stone unturned. Always open to meet people. Attend Job Fairs, call your recruiter and friends to check on the job openings and opportunities.

2. Don't hesitate to follow up and stay on top of your contacts. Everybody got their own priorities. For you, getting a job is the first priority but it might not be the case of your recruiter or contact. So try to call them up for any updates or latest job openings. Don't feel embraced to keep calling. Perseverance pays off over time.

3. Always Stay connnected - Use LinkedIn, Facebook or Myspace to stay in touch with your previous coworkers, friends, college mates, chruck groups or religious groups. A lead can come from anywhere. By staying connected with as many as possible helps you get as many leads as possible. In this bad job market, Staying connected with many people is very important.

4. Take a temporary contract job or consultant position if you are not getting permanent job offers. I know many don't like to go this route but it helps to pay bills and at same time you are not sitting idle. It might even turn out to be a good project you never know. No harm in trying.

5. Revaluate yourself  - This might be a better time to revaluate yourself and do something different if you are forced in this career. I have seen real examples from people who got laid changed their career from IT consultant to Entreprenuer or small business owner. If its too late and want to stick with same career. Try to Brush up your skills and take up some petty projects during the downtime from sites like getFreelancer.com, 99design.com. It helps to keep your skills shining instead of getting rusty.

These are some of my own practical tips. I also came across an interesting and optimistic writeup by a job loser. It's a  "Thank you for layoff" note to the employer by the laid off employee. Check it out. It might add a different perspective to your thoughts.

Never ever give up and Keep trying!!

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