Steps to Take if You’re Laid Off or Downsized 

Do one thing: If you lose your job, file for unemployment benefits, even if you only expect to be out of work for a short period of time. Learn how here: 

https://www.dol.gov/general/topic/unemployment-insurance

Job Loss is Challenging

Just thinking about losing a job – and all of the negative things that come with that – can be a challenging exercise. Unfortunately, the fact is that most of us will lose a job at some point in our careers. That’s why it’s important to be prepared so that if the worst happens you are equipped with strategies to help guide you through the experience. 

Consider these tips from financial planning experts on how to navigate a job loss. 

Give Yourself Grace

While your first inclination may be to update your resume – which you should absolutely do – it’s important to allow yourself to feel the emotions that come with a loss, says Spenser Liszt, a certified financial planner and owner of Motif Planning in Dallas.

Stress Management

Before you jump to action, he suggests doing something that helps you handle stress like the following:

• Take a walk/Exercise
• Talk to a trusted friend or family member
• Meditate/Beathe
• Write in your journal

Once you have allowed yourself some time to process what happened, you can move forward.

Try to Negotiate a Severance Package

If you aren’t immediately offered a severance package, no rule says you can’t ask or negotiate for one. Along those same lines, you can also ask your HR department about how long your benefits will extend past your last day with the company. If you or a family member have health issues, explain those to your employer when you inquire about health insurance coverage. 

Download Important Documents

It will be much easier come tax time if you go ahead and gather all of the paperwork (or digital forms) you will need from your soon-to-be former employer. Here are some of the most important pieces of information you should copy, save and/or download before your easy access to them potentially becomes more limited, notes Liszt:

• Salary data, including past pay stubs
• Statements for retirement accounts such as 401(k) and 403(b) accounts
• Dependent care accounts
• Health savings accounts (HSA)
• Flexible spending accounts (FSA)
• Pension details and stock options

Check on Cash Flow and Savings 

James J. Holtzman, a certified financial planner and president and CEO of Legend Financial Advisors, says one of the first things he does when a client loses a job is to review their cash flow and to make sure their cash reserves are sufficient. If the client is close to retirement age, he also looks at where they stand with Social Security. “How to bridge income until the revenue source is replenished is very important,” Holtzman says.

How to Review Your Cash Flow

For a cash flow review, do the following:

• Income Sources. Take a look at any other revenue streams that you have coming in. For those with more than one earner in their household, that means taking into account how much the other person brings home after taxes each month.
• Budget. If you don’t already have a household budget, you need to examine your last few months of purchases by taking a look at your bank statements and credit card bills to see where your money is going.
• Organize Bills. You should also make a list of every bill you owe each month to see if there is still enough coming in to cover those expenses.

Apply for Unemployment

As mentioned above, applying for unemployment is important when you lose your job. And while the amount may not be close to your usual salary, every dollar that you can set aside to pay your bills – and keep you from falling behind on any payments – is a good thing. 

Refresh Your LinkedIn Profile

A great way to let the business world know you are open to work is by sharing it on LinkedIn. Before you change your employment status, though, make sure the information you have about yourself is as accurate as possible. When it comes to finding work opportunities, LinkedIn can be just as important as your resume.

Create an ATS-Friendly Resume 

And while we are on the topic of resumes, if you haven’t changed jobs in a few years, you probably need to make sure the formatting has been updated. Why? These days, thousands of employers use applicant tracking systems (ATS) to hire employees. You can do a simple Google search for “ATS-friendly resume” to find free templates for this purpose.   

Don’t Burn Bridges

Even in challenging situations, it’s important to stay professional and upbeat as you depart, notes Liszt: “Leave with gratitude and your head held high. You never know what may come in the future.”