What Should You Do If You Lose Your Job?

There will be high unemployment for the foreseeable future. Companies have initiated hiring freezes and layoffs. Based on the current economy and outlook, there’s a high probability that you, a family member, or a friend have experienced a recent loss of employment or will in the near future. In this time of uncertainty it may be difficult to remain positive and focused. There are ways, however, to keep moving forward.

DON’T RUSH TO ANY DECISIONS

When you first sit down with your employer they may set some legal documents in front of you. These legal documents may include non-compete or non-disclosure agreements. Don’t be quick to sign anything that takes rights away from you. Don’t let yourself be pressured into signing anything right away. Read through them carefully and if you’re uncomfortable doing anything at that moment, tell them you need to review the materials with your spouse or partner first. That would also give you an opportunity to consult with an attorney.

Your employer may offer you a severance package, and like an offer for employment, you can try to negotiate a better deal than what they’re offering. Usually you have 21 days to accept a severance package, and then 7 days after signing it to change your mind.

THE BASICS

Apply for unemployment insurance benefits right away. You’ve been paying taxes and have the right to collect unemployment when you need it. California offers 26 weeks of unemployment benefits, with the possibility for extensions, especially during economic disasters such as the COVID-19 pandemic. With the CARES Act, unemployment benefits have been increased by $600 per week until the end of July. Eligibility has also been expanded to gig-economy workers, freelancers, and furloughed workers.

Immediately put together a spending plan. Without the income that you’re accustomed to, you may have to change your spending habits, especially if in the midst of a recession it could take months to find a new job.

Health insurance is vital to you and your family, so look into your former employer’s COBRA coverage, which allows workers the ability to continue using their employer’s insurance and health benefits for a specified time period after being terminated. You do need to pay your portion of the health insurance like you were before, but also pay your employer’s portion. The cost of the insurance will likely be significantly higher, but it does give you an option. In California, you can also look at Covered California as an option to buy health insurance through the exchange.

If you had a 401(k) or similar retirement plan through your employer, usually you can initiate a direct transfer of the assets in the retirement plan into a Rollover IRA, and your account will continue to remain tax-deferred. Keeping the account with your employer is an option as well. You should consult with your financial advisor regarding the best option and also to ensure you avoid taxes and penalties with any kind of transfer.

FIND A NEW JOB

Spend some time searching for and applying to job opportunities on the internet. Utilize your network of former co-workers, acquaintances, friends, and others who may provide advice and direct you to the right people at companies you want to work for. LinkedIn can be great for this.

For each job you apply to, take the time to tailor a customized cover letter to go with your resume. Update your LinkedIn profile and contribute on the platform to get noticed more. Reach out to hiring managers, recruiters, human resources personnel, and other hiring decision-makers. You can only make a first impression once, so practice your pitch and rehearse answers to common interview questions. Since, for the foreseeable future, many interviews will be conducted by video and phone, practice using those mediums.

Ultimately, stay positive and focused on your mission to find a new job and keeping your sanity during this crazy time. Be confident. Time will pass, things will improve, and you’ll find a great new job.

The accompanying checklist offers an easy way for you to identify the things you need to consider if you experience a loss of employment. It also could be useful for a decrease in pay, since that is a possibility with the current economic volatility. It’s a free immediate download once you fill out and submit the form below.

If you have questions or need advice on any of these issues feel free to...