As I emerge from the Covid quarantine bubble..I’ve got money & health on the brain!
My personal experience with Covid these past couple of weeks (aside from feeling like I’d been hit by a truck!) took me away from my main source of income for several days and, I’m lucky enough to say, did not impact me financially.
I choose to call my situation a combo of “Privilege & Planning”.
On the Privilege side, I’m white, employed, and live in an area that values sick/medical leave for employees.
Here in WA State I have access to at least two types of compensation during a health event: Paid Sick Leave and Paid Family & Medical Leave.
Let’s explore these options and particularly identify those who might be left out (pay attention independent contractors and entrepreneurs!) and who will need to turn to the Planning side in order to protect themselves from lost income during a health event.
On the Planning side, we’ll discuss tools such as an Emergency Fund and the Health Savings Account (HSA).
WA State Paid Sick Leave Policy
As of Jan 1, 2018 Employers are required to provide sick time to their employees within 90 days of employment.
The formula is 1 hour of Sick Time gained for every 40 Regular Hours worked, regardless of Full-Time/Part-Time, Seasonal, or Temp status.
Receiving 100% of your normal pay.
Any Sick Time that is un-used at year end must be rolled over; up to 40 Sick Time Hours are eligible for roll-over.
You may use your Sick Time for a mental or physical illness, if a family member needs your care, if your workplace or child’s school or place of care has been closed for a health-related reason, or if you are absent from work due to Domestic Violence.
Who may be excluded from WA State Paid Sick Leave: Independent Contractors & Entrepreneurs.
Independent Contractors & Entrepreneurs in WA State will want to rely on WA State Paid Family & Medical Leave.
WA State Paid Family & Medical Leave Policy
Starting January 1 2019, premiums began being collected from our paychecks for the Paid Family & Medical Leave program, with benefits being available Jan 1 2020. Paid time off is available 12 weeks-18 weeks per year and does not have to be taken consecutively. Receiving up to 90% of your weekly pay.
You must have worked 820HRS (16HRS/Week) in your qualifying period before becoming eligible.
This program applies to Full-Time, Part-Time, Seasonal workers, as well as Entrepreneurs as long as they opt-in.
You may use your Family & Medical Leave when a serious health condition prevents you from working, when you need time to care for a family member or a new child, or for certain military-related events.
How it’s Funded:
Paid Family and Medical Leave is funded through premiums paid by both employees and employers. The premium is a percentage of employees’ wages with the contribution divided between the employee and the employer. Small businesses that average fewer than 50 employees are not required to pay the employer portion of the premium.
Cautions: Your employer is not required to keep your job for you if any of the following is true: You work for a company that employs fewer than 50 people, you’ve worked for the company for less than a year, you’ve worked less than 1,250 hours (about 24 hours a week) for the company in the year before you took leave.
For more information on WA State Paid Family & Medical Leave see https://paidleave.wa.gov/For those without access to the Paid Sick Leave and/or are not signed up with Family & Medical Leave, an Emergency Fund will be of utmost importance during an unexpected health event. The minimum Emergency Fund recommendation is at least 3 months of bare bones (think rent/utilities) expenses, and a cushion beyond that to deal with anything health related. If you pay health insurance premiums, consider saving the amount of your Annual Deductible in this same account.I’m also a huge fan of the Health Savings Account, which is a special type of Health Insurance with higher deductibles and perhaps higher premiums, but the benefits are vast.The benefits of these accounts are that all of your contributions (not premiums, but other money you contribute to it) to the account are tax deductible, and you can take the money out tax-free to pay for medical expenses even retroactively years later if you can pay out of pocket in the meantime. Otherwise, you can take the money out to pay for medical expenses now, and since you never paid any tax on that money you’re getting a discount on that medical bill. The money in the account does not expire at years end and continues to roll-over. Make sure you understand your eligibility and coverage for the policies above, in order to feel confident in covering your next unexpected health crisis! I can help!
Unlocking Abundance 