Today was a sad day for Carmel and especially for about 8,000 employees of ITT Tech, based here in Carmel, Indiana. According to the Indystar, ITT Educational Services will be closing down because the Department of Education decided to ban ITT from enrolling students who depend on federal student loans. Since Halcomb Singler is also based in Carmel, Indiana, we thought we would try to write a blog to encourage and give some general advice to those who were employed by ITT and are now, sadly, receiving short notice that they will need to find alternative employment.
If you are an ITT employee you are probably going through a range of emotions right now including both anger and fear. This is certainly understandable. It is quite jarring that so many people are losing their jobs. Even if you have done “everything right” from a financial standpoint, it is quite difficult to get through a job loss financially. The Indystar article does not mention what, if any, severance package ITT employees will receive. We certainly hope that there is an opportunity for ITT employees to receive some severance to assist them in transitioning to the next chapters of their professional lives.
If you are an ITT employee that has funded an emergency fund for 6-8 months of living expenses, we are happy for you and hope that having this emergency cash gives you some peace during this time. While it is never fun to think about having to tap into the funds that you saved long and hard to acquire, an unexpected job loss is exactly the type of issues that an emergency fund is used for and it should be able to help you bridge the gap to your new job. Of course, there is no guarantee that you will be able to find a job in 6-8 months, but this is 2016 and not 2008, so the odds of finding employment within this time are good.
For those of you who do not have an emergency fund to tap into, we understand that you are facing a very scary time in life. In the event that ITT is not offering a severance we hope that you will be entitled to unemployment benefits. Although unemployment benefits aren’t much, some money coming in to your household is better than none. Now is a time to examine your family finances and it’s time to cut. Remember, you can always add an expense back into your budget once you have found a new employer.
Good expenses to cut include cable, smart phones for children, full-time child care (assuming you can be at home most of the time during your job search), eating out, children’s extracurricular activities, and student loans (if you can put them in deferment until you find a new job. Take a look at your car and car loan situation. Do you have a third car that has a loan? Can you sell the car to eliminate the loan payment from your budget and perhaps even have some money left after paying off the loan? If you know you aren’t going to be able to make your house payment, is now a good time to meet with a realtor to get your house on the market? If you have equity and a large monthly house payment, it might make sense to move into a less expensive rental house or an apartment to minimize your expenses. Understand that each person isn’t going to take each one of these steps, but there are some ideas regarding how to cope financially in the event you don’t have an emergency fund to fall back on after job loss.
For those who don’t have an emergency fund and have significant amounts of unsecured debt (credit cards, medical bills, personal loan(s)), you may find that there is not enough money to pay all of the bills. We typically suggest payment for your living expenses including house payment/rent, utilities, food, gas and car payments before payments of unsecured debt if there is not enough money to make all of the payments. In the event that secured property (typically a house or cars) payments are not made there will eventually be a mortgage foreclosure of a home or repossession of a vehicle. Unsecured creditors can file a lawsuit if your payment falls behind. In the event that a lawsuit is filed against you it is a good idea to contact an attorney.
Halcomb Singler, LLP, offers a free initial consultation to those who have been sued by a creditor. Halcomb Singler, LLP, offers representation in many areas of debt including debt settlement, Chapter 7 bankruptcy, Chapter 13 bankruptcy and the defense/negotiation of lawsuits filed by creditors (including mortgage foreclosure defense and credit card defense). Halcomb Singler, LLP, wishes the best to all of those affected by the closing of ITT. In the event that the closing causes a financial hardship in your life and you would like to put together a plan to eliminate or negotiate your debt click here or call our Carmel office at (317) 575-8222.
**Halcomb Singler, LLP, is a debt relief agency. It helps people file for bankruptcy under the bankruptcy code. No attorney-client relationship with the firm of Halcomb Singler, LLP, is created through this blog. Also, please note that Erika Singler is an attorney licensed in Indiana and does not seek to practice law in any jurisdiction in which they are not properly authorized to do so. The information contained in this blog is general in nature and should not be relied upon for the circumstances of any individual(s) or businesses.