Hear that? That is the sound of another self-righteous employed person complaining about the unemployed sucking up resources and driving the government deficit further into the red. Who cares employed people?? You guys aren’t the ones who are struggling to find a job in this economy!
Several Truths About Being Unemployed
1) Few can live a comfortable lifestyle off of unemployment benefits which average $200-300 a week
2) The vast majority of people who are unemployed want to make more money, find jobs, and do something meaningful with their lives.
3) Our budget is headed towards a multi-trillion deficit, so who cares if we’re going to spend another $50 billion to help millions of unemployed people survive for up to 99 weeks?
Budget Deficit Doesn’t Matter When You Have No Job
The big debate over the Republicans and Democrats on the latest enhanced unemployment benefits is how the government will pay for the bill? The Democrats say don’t worry, it’ll come from somewhere while the Republicans say cut spending elsewhere to not add to the deficit.
Whatever the case may be, the budget deficit doesn’t matter if you’re struggling to survive. We’ll have to provide for shelters and more public safety officers when crime creeps higher as desperation kicks in.
The ramifications of a budget deficit are only theoretical. People say the government will need to raise interest rates to attract foreigner capital to fund our greedy spending.
With higher rates by government, a crowding out effect occurs where efficient capital doesn’t get directed to the private sector. Meanwhile, borrowing costs for citizens increase, also choking off investments.
Refinance Your Debt Now
Last I checked, the 10-year yield is close to 1.73%, and foreigners are happily funding us. Meanwhile, plenty of people are smartly refinancing their mortgages and saving money.
People say budget deficits are also bad for our children. How can we live with ourselves knowing that our children are the ones who are going to fund our bad spending habits?
We live with it just like we live with the fact that the older generation will happily collect their social security checks, while the younger generation continues to pay without expectations of anything in return!
Once again, all this budget deficit talk is just theoretical nonsense. It carries very little weight in determining whether or not we should help our fellow needy citizens or not.
Let’s Care For The Unemployed
A portion of our paychecks are paid for by the employer. This expense (unemployment insurance) is effectively calculated into a working person’s total compensation.
If the unemployment insurance expense is 6% per annum, one can assume that if an employer didn’t have to pay this expense due to 0% unemployment, perhaps a couple percent of the 6% may lead to a higher paycheck.
So here is the thing for those who argue it’s a bad thing to spend another $50 billion bucks extending unemployment benefits. Or arguing against the $1.9 trillion economic stimulus package during a pandemic.
Would you rather have the Federal Government pay or pass a bill to increase the unemployment insurance paid by employers by another several percent? If you choose the latter, prepare for MORE layoffs.
What’s great is that even if you have investment income, you can still collect unemployment benefits. Unemployment benefits are tied to W-2 job income, and not to investment income.
Therefore, it behooves everyone to try and build as much passive investment income as possible for financial independence. It’s not good enough to just contribute to your tax-advantage retirement accounts. You must focus on building up your taxable investment accounts and real estate portfolio.
Be Empathetic With Those Who’ve Been Laid Off
It continues to perplex me how vocal some employed people are about not helping the unemployed. Unless you’ve been unemployed yourself, you have no idea what you’re talking about!
When you’re unemployed for an extended period of time you start doubting your self worth. You ask yourself what’s the point of life if nobody is willing to give you a chance. You give up looking because you can’t bare another non returned phone call or e-mail. Each rejection is like a blade jabbed and then turned in the soul.
As I come to the end of this article, I realize why so many employed people are so smug about the unemployed. The reason is they are very unhappy with their own jobs.
They can’t stand the fact that someone is getting $1,200 a month to “do nothing” while they have to work 40 hours at their miserable jobs to only earn $3,500. Miserable people like to make other people miserable. The next time you see someone irrational complaining why helping others is a bad idea, just know that they are going through their own torment.
If you were happy with your job and made millions of dollars, don’t you think you’d be more supportive of trying to help your brothers and sisters out? I think so!
Related: The States With The Highest And Lowest Unemployment Benefits
Want To Quit Your Job?
If you want to leave a job you no longer enjoy, I recommend negotiating a severance instead of quitting. Negotiate a severance like I did back in 2012. If you do, you not only get a severance check, but potentially subsidized healthcare, deferred compensation, and worker training.
When you get laid off, you’re also eligible for up to roughly 27 weeks of unemployment benefits. Having a financial runway is huge during your transition period.
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Daniel Rosenhaus says
A quote I feel is relevant, from John Steinbeck: “The problem with the working class (meant to include all of those who work) in America is they act less like exploited proletariat and more like temporarily embarrassed millionaires.”
People in America have issues with lowering their standards, especially with our new economic realities. I have friends out of college that wouldn’t take a non-paying internship for the experience. And as much as they are bull shit (the whole non-paid internship thing is something I’m passionate about), doing that for 6 months will more likely lead to employment than bitching about not getting any paid job for those same 6 months.
Financial Samurai says
I couldn’t agree more. That 6 month unpaid internship could lead to massive returns in the immediate future.
It’s because people have no idea what their government spends, so naturally they look at unemployment insurance and think it’s some insanely clever way to balance the budget–food stamps, too.
Even though more than 10% of people are on food stamps, and roughly the same amount are receiving unemployment benefits, the cost, relative to the rest of this outlandish budget, is marginal. I’m all about balancing the budget, but I still realize there are plenty of other items that are more expensive and easier to cut.
There will always be dead beats who try to take advantage of the system, and those who try and try and try and can’t get a job. I have a close relative who fell into the latter category. He literally applied to hundreds of blue collar jobs locally, in state, out of state, anywhere he could apply because all he wanted was to get a job. Sadly I think he was turned down a lot because of his age and with the amount of applicants, it wasn’t worth it to make a case for age discrimination.
Financial Samurai says
That’s sad for your relative, and I think that’s bullshit. It’s bullshit to discriminate against age, and I hope the state/federal government can help him out when he’s most in need.
There is an old joke that goes something like this, a recession is when your neighbor loses his job and a depression is when you lose your job. Although that is supposed to be a joke it is very telling about many of us. If you are not affected, you are less sympathetic. Very few people want to be unemployed and should we punish the majority for the few. Could the government done more to create jobs? Yes and they should!
Financial Samurai says
It really is easy to be unsympathetic when you aren’t in someone else’s shoes. It’s easy to point fingers and say this and that, but until we know what it’s really like, we need to stop with our petty insults and smugness.
Financial Success for Young Adults says
I think it’s really sad that many people have little compassion for the unemployed. I was unemployed for a year after graduation and I know what it feels like, and I wasn’t even elligible for unemployment benefits. I hope jobs continue to be created so that we can get back to a healthy economy.
This topic cuts to the heart of the matter. I am a white male who lives (exists) in a small northern city in Minnesota. There are not a lot of opps up here, and I have a cd/mi background. Nobody bothers me, and I walk/bike around town. I am not enamored of the system of capitalism, it favors the “silver spoon” types that are too much into themselves. Get some spirituality in your lives people! This life is temporary, the next one (should you believe in a higher power and an afterlife) will be much better………………
Financial Samurai says
Good to hear your story man, and glad you learned through experience.
Quick loan says
The extension to unemployment benefits will provide assistance to unemployed Americans due to recession. It is now said that US economy has added 882,000 more jobs this year.
Funny about Money says
Well, y’know, Sam… I think stress brings out the worst in all of us, even as sometimes it also brings out the best. Economic stress, which all of us are facing whether we’re employed or not, evokes fear, and fear breeds meanness and bigotry.
IMHO that’s what leads to the kind of hateful talk and behavior we’re seeing in many realms, especially political and financial. At least, I hope that’s the explanation. The alternative (that there really are, objectively, a lot of hateful people living in America) is much less pleasant to contemplate.
I am a “Smug employed person” living in Canada — Well, I don’t really consider myself “smug” ;). Here are a few ideas I have for helping to lower the amount of unemployed:
* Cut the red tape out. The IRS tax code and its cousins make things far more complicated than they need to be.
* Level the playing field by reducing subsidies and legal protections that make it more difficult for new players to enter an entrenched playing field.
* Restructure welfare and other social safety nets so that they don’t penalize people who seek to better themselves and seek employment. On the employer side of things, make it easier to do things like unpaid internships, or perhaps internships for room & board. In my view, getting some experience is better than getting nothing at all, and getting some money is better than getting nothing at all.
In our current crisis, some structural unemployment is inevitable, as people don’t demand houses as much (for example) and shift their demands to other things. Reducing the barriers for people to gain experience and seek employment as well as reducing the barriers for employers to hire people will help reduce the unemployment rate.
Studies have shown that families where everyone is unemployed raise kids who find it hard to get a job, so it’s important that people don’t get too dependent on receiving benefits, even if they don’t pay all that much. If there are no other options, then I can understand the need, but the emphasis should be on increasing those other options, not increasing the handouts.