“Fun” Little Freak Out

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Let me share with you a story about an all-out “FREAK OUT” moment I recently had regarding my pay.

In terms of back-story, I am on a 9-month contract which ends May 19. When my new contract goes into effect I’ll be switching to a 12-month contract. But that contract does not go into effect until the start of the fiscal year, July 1st. In the interim (May 20-June 30), I will be receiving pay designated as “supplemental compensation” at my current rate of pay (my raise doesn’t go into effect until the new contract).

Since the academic year is soon ending, I emailed our business manager last week asking if I needed to complete any paperwork/what I need to do to get the supplemental compensation to kick in. There was a bit of a process involved last summer and I can’t remember the exact steps.

The business manager replies back basically saying (paraphrasing), “I have no record of you receiving supplemental compensation this summer. Your new contract starts July 1st.”

And I’m like, “WHAT THE WHAT?!?!?!?!” (insert the Scream emoji face)

I’m instantly reviewing old emails and re-living old conversations in my mind. Is it possible that I misunderstood? That I simply thought I would be receiving supplemental compensation but that I’ll actually be going AN ENTIRE 6 WEEK PERIOD WITH NO PAY WHATSOEVER?!?!?!

I call my husband in a panic. How are we going to survive? Here, I was just saying how these next two months are going to be super tight…I didn’t realize we’d literally have NO INCOME during this entire time period! We (stupidly, in hindsight) sent our entire $5,500 emergency fund to the IRS when we were setting up/establishing a payment plan for our 2016 taxes. What were we thinking?! The IRS felt like an emergency at the time, but with the gift of hindsight, I now realize we never should’ve entirely wiped out all liquid savings. What are going to do?!

Deep breath in. Deep breath out.

I allowed my heart-rate to come down. I emailed my boss to gently inquire into this issue. Was I mistaken? Or am I supposed to be working for the next 6 weeks, as I had planned (not to mention, I’ve got work meetings piled a mile high on my calendar, and all kinds of tasks to accomplish over that time).

My boss was at a conference at the time so it took what felt like an eternity for her to respond. My initial email was sent around 2pm in an afternoon and I didn’t hear back until nearly noon the next day. It was just a simple clerical error. YES, I am supposed to be working (as planned). And YES,  I will be receiving supplemental compensation under my current rate of pay until my new contract goes into effect on July 1st (at which point my nice raise will go into effect).

Just breathe.

I have taken a couple lessons from this experience. First and foremost – we made a horrendous mistake in completely wiping out our EF. We need to get back to at least a “baby” $1,000 EF ASAP!!! Not sure how that’s going to happen given that we’re still grappling just to tread water and not lose ground over the summer. Either way, regardless, we need to have at least a starter EF to help us if, heaven forbid, we face a similar crisis in the future.  Second, rather than rushing to panic – maybe just reach out to my boss immediately and try to save the panic for later. In this case, I would’ve been able to sort out the situation and no panic was needed at all. Also, I’m glad I was proactive in reaching out to the business manager BEFORE the semester ended. It would’ve been a terrible surprise to have the semester end and then all the sudden have NO MORE PAYCHECKS when I was depending on them to pay our bills and feed our family! Yikes!

 

Have you had any financial “close calls” recently?

Ashley

Ashley

Texan at heart; Arizonan on paper. Lover of running, cheese, camping, and family (fur-family included!). Blogger, motivated to get out of debt YESTERDAY! Follow along with my journey!
Ashley

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6 Comments

  • Reply Walnut |

    Scary, but maybe a good kick in the pants. If I recall correctly, you’ve eaten into most of your ‘living on last month’s paycheck’ buffer in YNAB. I think I would start by building that up, so should something crazy happen, you at least know you have a month of expenses built up. In this case, it would have covered most of a surprise 6 weeks without income.

  • Reply T'pol |

    That is exactly why I ask everyone if they have an EF. Now you know the value of it too. I think as you get older, you need a fatter EF because, it is more difficult to find a new job in case one loses her/his job and one is more prone to health issues which may require serious amount of money.

  • Reply AT |

    Having been “that” administrator, go gently on her. Chances are good the records never made it down the chain to the one charged with executing the paperwork. And never freak out, it can always be fixed.

    Yay for 12 month contracts! Make sure you are clear with your department head and HR policies about faculty vacations. It’s not always clear but a 12 month contract ? no vacation.

    Thought on your IRS debacle. Are you in TIAA-CREF? Some institutions let you borrow against your account. It’s set up in TIAA-CREF, but it’s up to the school whether to allow it. Lots to find out, but it might be an option to get you an emergency fund right quick and pay off the IRS. You can always pay it back early.

    • Reply Ashley |

      Oh, just to clarify, I didn’t freak out at/on the administrator (just within my own mind). : )
      I had to google TIAA-CREF because I’ve never heard of it. My retirement is actually set up through Fidelity. In doing some further research, we only had two options (TIAA and Fidelity) and I had selected Fidelity – presumably just because I’m more familiar with them and already have investment accounts with them. I do have some funds in a Roth and my understanding has been that I could pull funds out of it (up to the amount put in – no interest) without penalties. I’d rather keep it where it is for now, but that’s always an option if something truly terrible were to happen and we needed cash asap

      • Reply AT |

        Might be able to borrow against the Fidelity too. It’s good to know your options. At our university, their contributions for faculty and senior staff are all TIAA-CREF, it’s a fine non-profit, and we can invest our own 403B contributions in them, Fidelity and a couple others. Roth is a good back-up plan too.

  • Reply dh |

    Is your husband going to school over the summer? If not, could he possibly do a couple of smaller jobs, or help out a friend in the same business for extra income?

    I’m glad it worked out though!

So, what do you think ?

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