The Financial Crisis - A Little Comfort During Hard Times

BREEDLOVE and ASSOCIATES

Counselor's Corner

October 2008


"I used a CPA last time I did this and it was not a good experience. So, this time I asked around. You have a lot of good word-of-mouth out here. Everyone said 'call Breedlove' and raved about how easy you make it."
-- Stephanie in Oregon--

The Financial Crisis - A Little Comfort During Hard Times

As our current economic crisis strikes financial fear in most Americans, it may be comforting for your nannies to know that being paid legally provides a significant safety net. Here are three pieces of reassuring news to share:

Unemployment Benefits. If a family is forced to lay off their nanny, she can rest assured that financial benefits will be available through the state unemployment office - as long as the family is current on their unemployment contributions as required through the tax process. If that's the case, she'll be eligible to receive up to 50% of her normal wages for up to 6 months.
Loans/Payment Terms. Banks and other credit providers have radically changed their credit qualification practices. For the foreseeable future, only those who can provide legal employment verification (i.e. Form W-2, Paystubs) will be able to get any kind of loan or payment terms. When unexpected expenses arise (auto repair, health problem, broken refrigerator, leaky roof, etc.), it's nice to know you have enough credit to get by.
Retirement Benefits. Since all employee contributions to Social Security and Medicare are matched by their employers - and the money earns interest over time - the average nanny will receive about $5 in retirement benefits for every $1 she puts in. Yes, it's a tax. But it goes directly to each nanny's guaranteed personal retirement benefit (unaffected by stock market fluctuations) - providing financial security in the future and peace of mind today.
So, let your nannies know that, even though times are tough, being paid like a professional has them prepared to weather the storm.