Take Advantage Of Unemployment Benefits And Milk ‘Em Dry

This is not an educational post. Instead, this is a post about discovery since I don't quite understand President Obama's American Jobs Act. One of the key initiatives of the jobs bill is “extending unemployment benefits further” given how bad the labor market is now.  I'm in full support of this ~$450 billion dollar bill, and besides figuring out how to pay for it (crushing local governments and charities it seems!), I have the following questions:

* Will the unemployment benefits be extended for those who have already exhausted their 99 weeks?  Or, is the 99 week unemployment benefits only to be extended for new unemployment recipients?

* If the unemployment benefits are extended for those who have already exhausted their 99 weeks, how many more weeks do they get?

You didn't believe my “Shock & Awe Yeah“, 5-year unemployment benefits program had a chance to become reality did you?  Well now you know the direction is true.  260 weeks of unemployment benefits is an incredible safety net that encourages people to take risks at their jobs because they won't be as worried about going into financial ruin if they get fired.  Think about all the the great innovation that will come out of people who are no longer scared.  It's great to see the government come around to mega unemployment benefits!


While soaking my aching muscles in the club's hot tub one day, I met a very tan and fit girl.  Nobody is that tan in San Francisco, because the average temperature year round is only 67 degrees.  So I asked her where she's been and she said 6 weeks in Bali after being let go from a job she hated at Billabong.

Of course I asked her whether she was able to get unemployment benefits while overseas, and she said por supuesto!  I asked her how, and she mentioned she'd never tell.  She'd have traveled longer, but was afraid her mail would pile up too high.  She was also a little paranoid that the California Employment Development Department would come knocking on her door to find out she's been gone for all this time.

After a couple of drinks in the hot tub, she finally opened up on how she could keep getting paid her benefits while not even being in the country and really looking for a job.  Amazingly, it's not too hard at all because everything is online!    All she has to do is “check in”. She also gave a trusted friend all her pertinent info to check in online for her and click the main box, “Yes, I have been actively looking for employment.”  After waiting 3 weeks for her first unemployment check to be direct deposited, they just start coming in ever week like clockwork.


Maybe because I was a little tipsy, I kind of felt proud of her for milking the government.  The government milks us so much in taxes to just flush our hard-earned money down the drain, that it was nice to see someone get some of it back.  After all, we pay into the system.  It's our money.

I've always thought about what I'd do if I was unemployed.  It's not something I want, or a situation I think any unemployed person really wants to be in, mind you.  I'm just imagining what if and looking on the bright side.  If unemployment were to arrive, I would get up at my usual 6am time and be the very first soul to stand in line at the unemployment line because I would be so excited to finally starting getting money from the government!  However, as we just learned from Bali girl, everything is done online, so I can just fill out the forms in my pajamas.

After I've registered, I'd consider taking a three month hiatus away from searching for unemployment to go travel the world on a cruise.  I would simply check in once a week online to demonstrate that I'm looking for a job.  Of course I'll search on Craigslist and e-mail some friends to see what's out there and keep in touch to keep things kosher.  However, with the internet, you no longer have to be trapped in your home to search for a job!


You think that there is some kind of limit to the amount of times you can collect unemployment, but given how inefficient the government is, I'm just not so sure.  Let's say you work for one year after college and got let go.  Can you then proceed to collect 99 weeks of unemployment insurance despite only working for 52 weeks?  After the 99 weeks is over, you find another job for 26 weeks until you get let go again.  Can you then go ahead and collect 99 weeks, 52 weeks, or even 26 weeks of unemployment insurance again?

In Pennsylvania, if you have worked at least 16 weeks in the base year, you get 16 weeks of unemployment.  If you worked 18 weeks, you can get 26 weeks of unemployment benefits though!  Each state is a little different, and if you're unemployed, simply file the claim and let the unemployment agency decide.

Whatever the unemployment case may be, I'm pleased to see the government extending unemployment to beyond 99 weeks, for new recipients and old.  Things are going to get real ugly before the holidays, and we need all the help we can get!

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60 thoughts on “Take Advantage Of Unemployment Benefits And Milk ‘Em Dry”

  1. I always regret not taking advantage like this. I waited too long to file for unemployment and apparently even if you aren’t working at the time, it has a time limit to use.

  2. OK….I just got let go from my job, but I already had another job lined up. I really don’t want the new job as it pays way less but all the hours I’ll have to work will make the pay close to my last job. Can I just no show at the new job and collect unemployment? I haven’t started the new job but all paperwork is completed. Help!!!!

  3. Just food for thought on the traveling thing.

    Being able to submit the claim forms online also allows the government to capture your IP address and subsequent location. I have known a number of people who have been fined for fraud when they “checked in” while overseas. The only ones I know who have gotten away with it have paid a friend to log in from their home town and submit the forms for them.

    Not as fool proof as you would think.

    1. I think that’s exactly how a friend got away from going on a 6 week surf trip in Indonesia while collecting unemployment. Her friend checked in for her on her computer!

  4. Ben @ BankAim

    You know sometimes I wish I could draw from unemployment benefits, but since I am self-employed I’d have to fire myself and then completely dissolve my Corporation before I could even think of qualifying.

    I have friends who have milked their unemployment for almost 2 years now.. lazy dumb***es.. and haven’t done anything to ‘better’ their situation in life. If that was me, I’d at least join the Yakezie network and work on my site 40 hours/week, while of course drawing from my unemployment.

  5. I’ve never had to use unemployment “benefits” but i have a friend who work in the office where people go for them. His role is more in counseling job seekers on finding a job. Still, he says you can’t collect these benefits if you are fired, or if you quit. You have to have been “laid off through no fault of your own”. So the strategy of quitting to collect 5 years of benefits won’t work.

    Makes you wonder though- if we keep extending it, at what point should we stop calling it “unemployment” and start calling it “welfare”?

    1. Hi Dara, you can get RIFed (reduction in force), laid off, or fired. People can seek to get RIFed and raise their hands to get let go, in order to collect the deferred comp and severance etc AND collect unemployment benefits. It’s up to the company’s discretion, but it is what it is.

  6. Roshawn @ Watson Inc

    Although this is a little off topic, I have to say that I was shocked that the way to pay for this stimulus is to hurt charities by removing some of the tax incentives to give to them. It’s quite sad and I think a move in the wrong direction. Moreover, often the proposed plans to pay for such bills rarely work out mathematically.

  7. I didn’t comment on unemployment benefits because I have been either self-employed or a small business owner for most of my working life. But the idea of milking the government and taking advantage of the system really makes me mad.

    I lost my mortgage brokerage in 2008 and because of being self employed I didn’t qualify for any form of government assistance. I lived off of savings for a year while trying to figure out what other business to get into. This was the hardest year of my life, I felt lost and angry, and at the same time I was watching my savings erode away month by month.

    Its one thing to loose your job and take unemployment benefits while you look for another job, its another to blatantly exploit the system and sit around and do nothing. So even if you “milk” the system for 99 weeks, than what? You have such a big employment gap now, how will that look to employers when you do start looking again when you don’t have the government hand out?

    1. Robin, sorry to hear about your mortgage company. Is it possible that you, as an entrepreneur/self-employed individual can’t get ANY unemployment benefits? This doesn’t sound fair at all!

      Self employed people take MORE risk, pay taxes and potentially hire people so how can they not get help if theygo under???

      1. I remember asking all my friends at the time if I should apply for unemployment, everyone around me told me that you had to have had a job and be laid off to qualify. I don’t know if
        are any other program I could have applied to, I choose rather to devote all my free to time to researching potential new business that could replace the income I had lost.

        1. haha ya… My sister and I were trying to create a classified ad website for college students. She got lazy and stopped working on it so I kind of took over the domain name for my personal blog instead of letting it go to waste. Its so hard to find a 2 word .com domain these days so I just kind of ran with it.

  8. Srinivas Rao

    First things first, I’m envious that you got to hang out with a tan and fit girl who worked at Billabong. That aside, the whole issue of unemployment benefits is an interesting one. Depending on where you live (an if you split the country) it almost gets rid of the incentive to find a job. Like you said if you can just check in once a week and do everything online, then why not go and travel the world and milk the government. I’m not sure I’d have an ounce of guilt in doing that. As far as the Obama, I don’t watch enough of what’s going in the news to make any intelligent contribution to the comments.

    1. Srini, have you ever considered applying for unemployment benefits after returning from Costa Rica? If you are eligible for $1,600, and haven’t incorporated your business, then why not right?

      Yeah, she’s super fit and tan. 6 weeks of surfing in Bali does that!

    2. I knew someone who was collecting unemployment, got a low paying job and continued collecting partial benefits then left that job after 6 months. After leaving, they went to South America since the spouse had relatives there and stayed for 2 months while still collecting. They used the Internet cafes to check weekly and submit job search claims. The US dollar has about 60% more purchasing power in this particular case

  9. Here is my take on the proposed 447 billion Obama job package.

    Where the heck is he going to come up with the money to pay for this?
    I just don’t see how the you can deficit spend your way to growth.

    I see America as a drug addict, addicted to debt. You can’t cure an addict by giving him more drugs. Sometimes its better just to let the illness run its course. Short term pain for long term gain.

    This whole new jobs plan. to me, seems to have politics and the up coming election written all over it.

    1. He’s coming up with $400 of the $447 by crushing State governments and Charities by taking away the tax exemption and tax deduction benefits. Those two groups are going to feel a lot of pain if this Jobs Act bill gets passed.

  10. Work for me represents higher compensation than unemployment and a career that is fulfilling. My milk of choice will be Social Security! I hope to live until 130 in order to milk that one.

    The unemployment system is purely a stop gap measure. It is easy to take advantage of it, but you better be the non breadwinner or live with your parents. There are some checks and balances in the system, but easy to fool the system. Should you travel and not look for work? Of course not, it is a question of character. It is easy to take advantage of the system, collect the money and work on the side off the books. I couldn’t and wouldn’t do it, but it is possible.

      1. Come on mate, the government wouldn’t lie to us and make us put in tens of thousands of our money over our lifetimes and not pay us when we retire! This is America baby! 4 more years!

  11. Money Reasons

    I wish the government would stop continually trying to put a bandaid on the unemployment problem and instead focus on wage differences between the US and other much lower wage countries.

    They are smart (in theory) people in the government and must realize that is the problem. Why don’t the come up with a clever solution to solve that issue? Perhaps if they did, unemployment would go down again…

    1. MR,
      I’m assuming you are referring to India and China? I don’t think there is a clever solution because this is the natural course of a global economy. Its perfectly natural for companies wanting to cut costs and maintain profitability by out sourcing. Out sourcing has benefits for consumers in the US in terms of lower costs on things we buy.

      Instead I think we should focus on what America does best at, which is innovation. No country on earth can compete with our ability to innovate and create. Focus more on the entrepreneurs, and small business owners, and I think the unemployment will take care of itself.

  12. Why don’t we just educate people to save the same amount as they would have saved for unemployment insurance, and then if they lose their job they simply have their own money to fall back on? In fact, it would be a lot cheaper since you’d cut out 56 levels of bueracracy along the way. Oh wait, that is too simple and free, I forgot that we have to make things as complicated and interfering as possible. There are so many people like that girl that I am becoming more and more of a small-government-at-all costs guy. I’ve never been like that before, but I look at the crisis in Europe and think that we can’t be that far away if we keep forcing government handouts down people’s throats. Instead of milking the government, why don’t we just keep our own money and milk our own proverbial financial udders?

    1. Fine. I’d be happy to have my contributions back to live on now that I can’t find work. I’ve contributed for 41 years, now at 59, I’ve exhausted my year of unemployment. If it takes another year for me to secure employment, I’d like to live on what I paid in. The same goes for Social Security. Don’t use the word, “entitlement” and think I didn’t pay for this on every paycheck of those 41 years. The people on unemployment are so much more diverse than the tan traveler. I’m thankful that I don’t still have children under my roof who I can’t feed, clothe, and provide shelter for- I can’t imagine that heartache. Homeless people are not a “problem” they are people. Most want to be engaged and contributing in a fair day’s labor for a fair wage that meets the costs of housing, food, and utilities in their area.

      1. Thanks for your thoughts. We did indeed pay into the system, so it is OUR money indeed!

        If you’ve worked for 41 years, it’s safe to say you have a lot of capital saved up right? If so, what are your thoughts about skewing unemployment benefits towards the younger unemployed who don’t have as much time to save money?

      2. Exactly, this is the sort of situation I’m talking about. You’re put in a tough spot, meanwhile Ms. Love-To-Travel above is soaking up cheques without doing anything. If you could have just kept all your contributions and invested in GICs and Bonds, or similar low-risk investment products, my guess is that you would fine today right? We as individuals need to start taking some responsibility for our futures and actions because clearly depending on government no longer works.

  13. The fact of the matter is that the only solution to help unemployment is to improve the labor market. I fully agree though, that the government should nurse the unemployed, still this will not solve the problem. If we want to boost the job market, we need to improve our economy first. If our country is able to get out of debt in five years (which won’t be the case with short term solutions such as this act) the government will then be able to nurse established businesses, and businesses are what makes the job market and improves our economy. If we keep investing into helping the unemployed, it gets us absolutely no where. Besides the fact that people get free money, it doesn’t help for the long term whatsoever. Even if we extended unemployment benefits to up to five years, we would just be giving free and tax-free money to individuals who probably don’t use that money correctly. They spend it on the necessities and also the unnecessary expenditures, which in turn doesn’t help the individual.

    I truly feel the pain for the unemployed, I don’t know where I would be with out a job and if my parents didn’t have jobs. It’s really a tragedy to families when one loses their job, but what if the government gave the money to business instead of spreading out the money to the 50 ex-employees they just laid off.

    1. *But what if the government gave the money to businesses to give them a second chance to not lay people off, instead of getting people laid off and giving them free money.

    2. The thing is…. we can’t let people starve. If you haven’t found a job after 99 weeks, you are even MORE hurting that the newly unemployed. We need to take care of them.

  14. I need to figure out how to get unemployment when I quit my job! I’ve been working for 15 years and I think I deserve some of that 99 weeks of unemployment.
    Well, it’s nice that the Bali girl went on vacation on the government’s dime, but I think karma will catch up to her eventually. Maybe her work ethic is ruined now and she’ll spend the rest of her life trying to milk the government. Who knows….

    1. Conceivably everyone should consider timing their retirement by coinciding with getting 99 weeks of unemployment. Let’s say you plan to retire on Jan 15, 2012 anyway. If you could get RIFed on Jan 15, 2012 instead, you can enjoy 99 weeks of unemployment during retirement. Strategic unemployment!

  15. I am always a fan of social programs, but I think this one needs to be handled carefully. I know someone who arranged his own layoff rather than quit a job so he could get unemployment. (This is a conservative Republican who claims to be against government handouts)

    I think unemployment should be coupled with requirements that the recipient be actively looking for work or in an education program that will lead to better jobs skills. I am not sure how to monitor those requirements, but I think it is important that as we help people they help themselves as well.

    1. If you knew you were about to retire in 99 weeks, wouldn’t you engineer a layoff so you can collect severance and unemployment as well? There has to be a backstop, and retirement is it!

  16. baronvonjon

    It’s not that difficult to see what country the ip address is in when checking-in online. I know someone who was checking-in ifrom France. He’s been caught by NY State and has been cut off.

    1. But who says he’s not diligently looking for work back home while on the beach in the south of France? What gives government the right to determine how and where one can look for work? We are entitled to government money.

  17. Untemplater

    I knew a guy who heard his company was going to have layoffs soon and basically did his job as bad as he could so he would be let go and could start collecting unemployment. Why would he do that? I think it’s because hated his job already and his long commute, already wanted to leave and was attracted to being able to get collect unemployment while getting out of there at the same time. Gaming the system, yes, does he deserve the same benefits as someone who really wants to keep working but can’t, no, but the government can’t tell the difference.

  18. If there is a program to get money from the gov’t then there will always be people who will figure out how to get the most from that program. It reminds me of the Earned Income Tax Credit (EITC). I am always amazed at the numbers of people who know precisely how much income they need to maximize the amount of EITC that they can receive. Each year this results in huge tax refunds for them, even though they paid absolutely no taxes.

  19. It is absolutely wrong and dishonest. I pay taxes so that people who need a leg up (including myself, should I ever be in that position) can get it when they need it, not so they can go on a vacation on my dime. It’s people like your friend that create the misconception that everyone who collects employment insurance is lazy and gaming the system.

  20. Sunil from The Extra Money Blog

    I know a few who have had no issues collecting and milking unemployment. In fact I haven’t heard anyone I know turned down. I’d say it’s a good time to travel, catch up with unfinished business, or start a business . . . . one of these falls in the unethical category while another illegal

  21. Yes it’s wrong to blatantly lie about looking for work if that is one of the requirements for receiving benefits. Extending unemployment is stupid because it gives people incentives not to work.

    The other thing that makes the Financial Samurai plan completely null and void and many states is the fact that starting your own business technically means you have a job and are no longer eligible for unemployment benefits. You have have to change these laws for your 5 years plan to make any sense.

    1. But it’s not lying if you check in for a couple minutes a day and look on Craigslist in the Jobs Section.

      And for my 5-year Shock & Awe Yeah plan, it’s about optimizing existing businesses and employees, right here right now, so more hiring is made. Awwww yeah!

  22. Darwin's Money

    Well, for one, this is a “proposal”. Historical extension of benefits have only been to add more recent cohorts that weren’t eligible for 99 total weeks to get them up to that same level. I don’t believe anyone has been receiving MORE than 99 as part of these extensions. Rest assured that giving people even more, like 150 weeks or indefinite, etc., would never pass Congressional approval.

    What’s laughably deceiving about the name “Jobs Bill” is that it’s primarily social spending again – most of the money is unemployment benefits and more payroll tax cuts – which are temporary, will be gone in a year and do nothing to spur long-term investment in plant, equipment and new hiring.

    We need a STRUCTURAL change, not band-aids. Because the first 3 stimulus programs didn’t work and this one won’t either but they’re quite expensive.

    1. So…. let’s say you’ve run out of unemployment benefits as it’s the 100th week… .are you saying that President Obama and the government just isn’t going to help you anymore with this Jobs Bill? That you’re screwed and only newly unemployed get the benefits? That doesn’t seem to make sense to discriminate between new and old unemployed does it? If you are unemployed, new or old, you need help!

      1. Normally unemployment maxes out at 26 weeks. Congress can vote to extend unemployment benefits during times of economic crisis. But until this recent downturn – it had never been extended to 99 weeks.

        Pres. Obama is proposing that Congress continues the maximum extension to 99 weeks. So fi you’ve already received unemployment for 99 weeks, then you are SOL.

        The proposal is only to keep the maximum at 99 weeks – but first it would have to be approved by Congress.

        Here’s more about the American Jobs Act and reaction from some top economists. blog.checkadvantage.com/2011/09/09/obamas-jobs-plan/

      2. Darwin's Money

        There are an estimated 3 Million-5 Million (since the govt DOESN’T provide these statistics) Americans that have already exhausted their full 99 weeks and yes, they are SOL. That is, unless they can briefly get a job, get laid off and start collecting again. Although I don’t know that they’re screwed. They just have to start working. It’s been 2 years. Seriously.

      3. Yes, I think you can. I believe in my state they calculate your average earnings to determine the rate you get.

        The rate (I think) is usually about 2/3 of what a person makes – unless they already get the maximum, which differs state to state.

        I don’t think the bill is pointless. If I just got laid off from a job, and all of a sudden I could only collect for 26 weeks when people who got laid off before me got 99 – I’d be ticked. I think it’s more about keeping it going for people who are still losing their jobs.

        I agree with Darwin – 2 years is pretty long to suck on the govt teet. But don’t forget- you can also collect partial unemployment if you work part-time and continue to look for full time work.

        1. Here’s the thing though…… “f I just got laid off from a job, and all of a sudden I could only collect for 26 weeks when people who got laid off before me got 99 – I’d be ticked”. Do you see what just happened there? The program has created 1) Courage for us, like my 250 week Shock & Awe Yeah program would give, or 2) More entitlement, as in if he got 99 weeks, so should i.


          It’s not 2/3 of what a person makes… it’s 2/3rd of what a person makes up to a maximum of around $1,600 a month. If it was 2/3rd of what a person makes, I would try and get let go right now.

  23. While that sounds like a dream life, I still wouldn’t feel comfortable with traveling while receiving unemployment benefits. I know you aren’t saying that everyone is like the tan, traveling girl, but there are still lots of people who need this money because they don’t have an education and just simply can’t find a job.

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