Are you quitting your job? Here's how to make a smooth exit when you leave and start out your next venture on the right foot.
Goodbyes are hard and bidding farewell to a job is no exception. Whether you’re sad to leave or can’t wait to be finally free, you’ll want to be as prepared as possible when the time comes to clear out your desk.
If you haven’t put much thought into your exit strategy, you should. How you leave your current position will affect how well you start your next one.
In case you need a helping hand, here’s a run-down of tasks to tick off your list as you prepare for your last day. Ensuring a smooth exit that leaves a lasting impression as positive as your first one.
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Craft a Well-Written Resignation Letter
Even if you’ve mentally checked out from your daily duties, there’s one job you shouldn’t skimp on: writing a resignation letter. According to Forbes, your resignation letter will set the tone for your next two weeks at the office. As well as your future relationships and ability to ask for references.
A good resignation letter is direct, concise, and most importantly, polite. Regardless of how you feel about your current job, insults and sass have no place in a resignation letter. So save that (and the large glass of Pinot) for when you get home. Remember, your resignation letter is an official document, and will often be the last thing that your higher-ups remember you by. So make sure you leave a memorable impression for the right reasons.
Weigh Up Your Retirement Plan Options
While you might not be ready to take your feet off the corporate ladder just yet, it makes sense to weigh up your options. So review your retirement plan carefully, as well as that of your new employer (if you have one) before you submit your two weeks’ notice.
Amir Eyal, Financial Planner and CEO of Mylestone Plans, remarks that it often makes sense to move your 401(k) to an Individual Retirement Account (IRA): “Moving your retirement plan out to an IRA can potentially save you money, but moving your retirement plan to another retirement plan might not.” It’s important to evaluate all the options available so that you can be sure of making the most financially responsible decision.
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Pay Back Your Loans
Just as you don’t want to leave any unfinished projects at your old job, you don’t want to let any loans linger on. Especially if you’ve borrowed from your retirement plan.
As Eyal notes, most 401(k) or 403(b) plans require you to pay back all loans within 60 days after quitting. If you fail to do so, these loans, which are originally tax-free, become (gulp) a taxable event (plus a potential penalty). Paying back your retirement plan loans on time will ensure that you don’t get nailed with a Form 1099 in your mailbox after you quit.
Sort Out Your Insurance
If you’ve got a new job lined up, you may not have to worry about insurance. You’ll probably be covered under your next employer’s group health plan (assuming that they have one). But if they don’t, then you’ll need to check out your rights and know what’s available to you. The Consolidated Omnibus Budget Reconciliation Act (COBRA) states that you can retain access to your group health insurance for up to 18 months after leaving your position.
The downside? You’ll have to pay for 100 percent of the coverage, rather than sharing the cost with your employer. So it’s best to compare the costs and benefits of that situation against purchasing private coverage. In the same vein, Eyal advises that you check what your new employer offers in terms of group life and disability coverage:
“If these benefits are not offered, especially disability insurance, you may want to review your conversion options from your previous employer or supplement with new private coverage.”
Secure Your References Before You Quit
Regardless of whether you have another job waiting or not; get references from your supervisors before you quit. People change positions and switch companies more frequently these days. It may not be long before there’s no one left to vouch for your performance. Time is unforgiving. So make sure that you get your letters of recommendation written before your boss forgets who you are.
Clean Up Your Social Media
If you’re back in the job market, don’t forget that the internet is an unforgiving place. Now that you’ve got some free time on your hands, go through your Facebook to make sure there’s nothing unsavory attached to your name. That wet t-shirt pic? Take it down. The comments about wanting to kill your boss? Delete them. You get the idea.
In fact, you should always carry out routine social media clean-ups. You never know when someone important will be checking out your profile. Even if you’ve already got something else lined up. You don’t want your first impression at your new job to be an embarrassing tweet from eight years ago.
Don’t Burn Any Bridges
Finally, once you’ve written your resignation letter, sorted out your retirement and insurance plans, secured your references and cleaned up your Facebook, just one task remains: exit gracefully.
As tempting as it may be to tell your bosses exactly what you think of them, bite your tongue. Save the four-letter words and victory dances for when you’re celebrating with friends after your last day. Just make sure that none of it ends up on Facebook.