Unemployment Compensation Amendment Of 1992

It’s time. Time to leave the company you’ve been working for. But what about your 401(k) plan, which had a matching contribution up to 3.5%? Thanks to the Unemployment Compensation Amendment of 1992, it gets to come with you...even the employer match that’s been paid into it.

The Unemployment Compensation Amendment of 1992 allows ex-employees to keep the money that they invested and saved while working for their employer, no matter the type of pension plan. The amendment writes out the options for how this can be done, including transferring retirement funds into a new account.

Don’t think you can use the Unemployment Compensation Amendment of 1992 to get your hands on your retirement funds without penalty though. You can get the funds directly, but you’ll have to pay a 20% penalty to the IRS on it, so...better to transfer it and not touch it.

No touching!

Related or Semi-related Video

Finance: What are Unemployment Benefits?3 Views

00:00

Finance Allah Shmoop What are unemployment benefits Well a century

00:08

ago and you lost your job This is what happened

00:10

to you then this and then this Well the government

00:14

decided that America was better than this and that there

00:17

should be a shock absorber in the personal economies of

00:20

individuals when they were fired And yes sometimes employees did

00:24

such a lousy job at work They deserve to get

00:27

fired But other times cos downsized into higher divisions so

00:30

employees who are at no fault of their own were

00:33

fired And other times injuries illness and other factors played

00:36

a role in turning this guy into this guy So

00:39

the U S Government created an unemployment benefit system that

00:43

filtered through out the country And it was a kind

00:46

of buffer when an employee went from earning a grand

00:49

a week Teo nothing Unemployment benefits comprise a few things

00:53

Well first there's the money And in order for there

00:55

to be money in the till somewhere too Hey for

00:57

that unemployment benefit system the US introduced attacks that basically

01:02

socks away money for the future with certainty that well

01:05

at some point a whole lot of people will be

01:07

unemployed and appreciate the buffer It's a fair question to

01:10

ask What about the people who were planners plotters preparers

01:14

for a rainy day But why do you tax those

01:17

people so that they then pay for workers who got

01:20

fired and weren't disciplined enough to save their own damn

01:23

money Well it's kind of the price you pay for

01:25

being a superpower So yeah the US does have freeloaders

01:28

criminals leeches on the system lazy people and bad workers

01:32

But we have so many more of the good egg

01:34

kind of people that we can at least as faras

01:36

today goes afford TTO have a generous unemployment system So

01:41

how does one actually qualify for unemployment benefits Well usually

01:44

you have to have lived in your state for at

01:46

least a year before collecting them and typically you have

01:49

to show that you're continually actively seeking employment and not

01:53

just binging Handmaid's tale on your sofa And often you

01:57

have to show that you were laid off through no

01:59

fault of your own Like if you were fired from

02:02

RVs for throwing four pounds of roast beef at the

02:04

head of a customer No you'll probably need to look

02:07

into you know Plan B i e soliciting your family

02:10

for alone instead of hoping unemployment covers Yeah And well

02:13

don't expect the benefits to allow you to continue your

02:16

existing quality of life Generally even if you do qualify

02:19

for benefits well you'll get about a third or after

02:23

our last of your old salary So you're less likely

02:25

to end up on easy street with unemployment benefits than 00:02:29.25 --> [endTime] you are to end up on the streets

Find other enlightening terms in Shmoop Finance Genius Bar(f)