Steps to Consider After a Layoff from a Financial Advisor

Losing a job is tough. It can feel overwhelming, disorienting, and emotionally draining.

Even if you had some sense it might happen, the suddenness of job loss can still be a major shock. For many people, their sense of identity is closely tied to their work. In the immediate aftermath, it’s normal to feel shaken. Once you’ve had time to regroup, here are some steps to help you move forward after a layoff.

1. Maximize Your Employer Benefits

Speak with your HR representative to understand which benefits, if any, you’re still eligible for after termination.

Check if you have unused vacation time or paid leave that will be included in your final paycheck. Some companies also offer services like career counseling, resume support, or job placement assistance to help employees transition.

Before the dust settles, it’s also wise to request written references from your manager or colleagues. These recommendations can validate your skills and character, which will be valuable in your job search.

2. Apply for Unemployment Benefits

To access unemployment insurance, submit a claim through the unemployment program in the state where you were employed.

Keep in mind the following eligibility criteria:

●       You must be physically able to work and not receiving disability benefits.

●       You need to be actively searching for employment.

●       Your job loss must have been involuntary, with no fault on your part.

Note that if you’ve collected unemployment within the past six months, the amount you receive could be reduced.

3. Explore Health Care Coverage Options

If you lose your job, you may be able to keep your employer’s health insurance for up to 18 months. This is possible under the federal COBRA program, but you must pay the full premium yourself.

Talk to your HR representative. They can tell you if your employer offers any COBRA subsidies. They can also confirm how long you and your dependents can stay on the plan. In certain situations, you may qualify for extensions beyond the standard 18-month coverage period.

You have at least 60 days from when you get your COBRA election notice or when your health coverage ends. You can enroll during this time, whichever date is later. If you’re over 65, make sure to understand how COBRA will coordinate with Medicare to prevent any coverage gaps.

If you have a Health Savings Account (HSA), you can use the money for COBRA premiums. You can also cover other eligible expenses. These include vaccinations, chiropractic care, and diabetes supplies.

If you don't have health coverage from your job, check if you can sign up for the Health Insurance Marketplace. If COBRA is too expensive, this is a good option to consider. Life events, such as losing a job, start a special enrollment period under the Affordable Care Act (ACA). This lets you find a new plan outside the regular enrollment time.

Another option is purchasing private insurance directly from an insurance provider, private plans tend to be costly and offer limited coverage. Keep in mind that ACA subsidies are not available for plans purchased outside the Marketplace.

4. Gather Resources for Your Job Search

Take some time—whether it’s a few days or weeks—to reflect on what matters most in your next role and how your skills align with your career goals. If you don’t have severance or unemployment benefits, taking on temporary work can help bridge the financial gap.

It’s also a good idea to document key accomplishments from your previous job before details fade from memory. Make sure to update your resume and LinkedIn profile as soon as possible.

Let people know you're in the job market. Reach out to friends, family, former colleagues, and professional networks to spread the word and uncover new opportunities.

5. Plan for Your Retirement Savings

The silver lining is that you have options for managing your workplace retirement account after leaving your job. Most employers let former employees keep their savings in the plan. However, you should check the specific terms with your plan administrator.

If your account balance is between $1,000 and $7,000 (a threshold increased from $5,000 in 2023), your funds may be automatically rolled into an IRA. For balances under $1,000, your employer might send you a check. If that happens, you’ll have 60 days to transfer the money into an IRA or another retirement plan to maintain the tax-deferred status of your savings.

Spend Thoughtfully and Pace Yourself

Even if better opportunities are on the horizon, it’s smart to manage your spending carefully after a layoff. Try cutting back on nonessential expenses temporarily to stretch your savings and maintain financial flexibility. Ideally, this will just be a brief pause in your career, and you’ll be back to work before long.

Bottom Line

Losing a job is never easy, but taking proactive steps can help you regain control and prepare for the next chapter. By making the most of available benefits, exploring new health care options, and keeping your savings intact, will help protect your financial well-being during this transition. Lean on your support network, update your job search tools, and stay open to new opportunities. With patience and persistence, you’ll be back on track in no time—ready to embrace whatever comes next.

Sources:
https://www.fidelity.com/learning-center/personal-finance/what-to-do-after-layoff