If you just got laid off, you may be asking: what’s next? Here’s what to do if you lose your job unexpectedly.
There was a time when job losses were across the board and piling up weekly. Things may not seem as bad today, but I’ve got a friend who recently called me with the news that she’s been jobless for 2 months now, and as a breadwinner, she’s somewhat concerned. In her words “this is the first time I’ve ever been without a job.” Unless it’s happened to you, it’s hard to explain the anxiety one feels upon getting laid off. But it’s not time to panic just yet, if you’re able to channel that anxiety towards doing things that are more productive.
Lots of “layoff survival guides” are cropping up these days, but being a layoff survivor myself (from the 2000 tech sector collapse), I’d like to chime in on the subject. If you’ve been recently laid off, check out our pointers on how best to proceed:
Survive A Job Layoff: 14 Things To Do When You Lose Your Job
1. Negotiate for that severance package!
Even if your company doesn’t necessarily offer severance, you may be able to negotiate a parting package with them especially if you’re one of their valuable employees with a long track record. You think it can’t be done? In my case, even with my former startup in the dumps, I was able to receive a bigger package than 99% of employees. You know how? I was 3 months pregnant. Apparently, there are laws protecting employees when certain special conditions are met. The lesson here is that anything is possible, and you’ll only know if you qualify if you rattle the cage a little bit. What have you got to lose?
2. Figure in your unemployment benefits.
Most people have unemployment benefits they can count on for only a short bit of time after they’ve lost their jobs. When a recession is particularly long and nasty, those benefits are usually extended for longer periods of time. It may tide you over for a bit, but don’t let this lull you into complacency about finding your next job.
3. Polish your resume.
Keep these few tips in mind when you update that killer resume:
- Only include relevant and significant achievements.
- Don’t ramble , keep things concise.
- Use numbers and statistics to help describe your job better.
- Describe those things that make you stand out.
- Don’t lie!
Check out our resume writing tips.
4. Work your network.
When you’re out of a job, you’ll certainly want to keep networking with people. If you’ve got great relationships with your colleagues and ex-colleagues, you may have a leg up with your job search. Get in touch with them through social sites like Facebook or LinkedIn.com. This is one more reason why it’s important to stay in good terms with your work chums.
Whenever you network, be sure to take with you your business cards or contact information that indicates your occupation and what you specialize in. Be up front with others about your availability and your situation. The networking process is one of the best ways to land your next job; in my personal experience, I’ve had a pretty good track record with getting a job this way (through connections).
5. Leverage online job resources.
This one is pretty obvious…. I’ve found many jobs online — either by contacting recruiters in my area or by making inquiries at particular job boards and job sites. Depending on the type of work you do, certain sites may work out better for you than others, as far as generating job leads. We’ve compiled some helpful job resources and employment sites here. The best way to use job sites is to use them to give you leads on potential jobs. You may have to do some filtering and research to sidestep the bogus jobs that may be listed on these places.
6. Conserve your emergency fund?
Hopefully you’ve been able to stash enough cash in your emergency fund to last you through a downturn. Typically it’s been recommended that you have at least 6 months’ worth of expenses to tide you over. But these days, liquidity is king! If you want to be absolutely certain that your expenses are fully covered if you DO get laid off, then you’ll have to rethink how much cash you should hold. Where to put this money? Somewhere ultra safe, such as a high-yielding cash based bank account.
7. Prepare a budget.
For those who are secure about their finances, following a loose budget is probably sufficient. In fact, I know a lot of people who admit to not maintaining a budget. But if you’re in dire financial straits, it’s imperative to have one! If you know you’ll be facing financial problems (or have them right now), then it’s pretty important to keep tabs on how much you are spending monthly.
By using money management software or simply writing things out on paper, you can begin to get control of your financial situation — you’ll get better visibility over your income and outgo and can anticipate your cash flow. Be sure to include your estimated unemployment income as well as savings that you may have. I would also attempt to ration the savings out over six months at a minimum. It would be ideal if you can make your savings last longer. But while you’re doing this, make sure you’re doing what you can to find a new job as you’ll want to replace the lost savings as soon as possible.
When completing a budget, I would recommend cutting the “entertainment” expense, which includes eating out, movies, and trips. I also recommend doing away with your extraneous “pampering” expenses such as getting your hair and nails done as well as massages and personal trainers. In tough times, these items are not necessities and are the least missed.
8. Call your credit card companies.
If you have credit card debt, you’ll want to call each creditor to see if you can qualify for a “hardship program.” Most credit card companies offer hardship programs, which typically last from six to twelve months. These programs lower your interest and payment amount each month. These opportunities are great as they give your budget a break, but still allow you to pay on time every month, which keeps your credit score intact. Keep in mind that when you go on a hardship program, you will not be able to use your credit card. Therefore, you may want to keep another credit card as a reserve or back up to use for any emergencies you encounter while you’re out of work.
9. Negotiate and save.
During a time of job loss, you will have more time on your hands. For those who are so inclined, consider developing the habit of using coupons wherever you can (online coupons make it very convenient). Attempt to save everywhere possible. Negotiate everything you possibly can from clothes to food. For instance, you can visit your local Farmer’s market for fresh veggies and fruits: the prices are typically lower here than at grocery stores, and the produce is often much tastier. In addition, look for bargains. Use your free time to save your cash rather than continuing to spend as you did while employed.
10. Pay necessities first.
Lots of people on the verge of losing everything will continue paying their credit cards but may start cutting back on essentials. This may not be a wise move. When you are looking at a budget that is negative, it is imperative that you take care of your basic necessities first. This includes your rent or mortgage, electricity, water, food and transportation. If there is money left over after paying these items, you can then begin paying your other bills, including your credit card obligations. These are hard trade offs to make, but you’ll have to make them until you’re back on your feet with a steady income.
11. Diversify income sources.
Diversification is not just for investments. It also pertains to income generation and wherever else you may be spending your time. If you’ve got other ways of making money other than through your job, you’ll be in much better shape when a recession hits. So if you’ve got talents and skills, or that perfect hobby you can parlay into a business, you may think about leveraging these things into money making ventures and alternative income streams.
12. Seek support.
Some people may feel uncomfortable sharing their job loss with their families. Ever hear of those laid off folks who continue the charade of getting up to “go to work”, hiding the fact that they’ve lost their jobs to their families? Well, if instead you decide to seek out support and share your predicament with others, the better your chances of finding a replacement job (see #4), as others may pitch in to help you with your search. Plus, it usually feels better (at least it is for me) when people are commiserating with you over your situation.
13. Don’t give up.
Don’t feel discouraged! It’s easy to feel out of sorts when the job search takes longer than you expect. But these days, a lot of people are in the same boat. It’s important to stay persistent though and to keep your spirits up when you’re on your hunt. Tomorrow may just be the day you land something.
14. Think outside the box.
I’ve known some people who feel that because they’ve fulfilled a certain job or role for many years, or because it’s always been their ambition to pursue a particular career, that they must, at all costs, continue down a particular path. But tough times require flexibility, resourcefulness and practical thinking. I believe that we shouldn’t pigeonhole ourselves into specific roles or types of work — go where the demand is (if your skills are a fit), in order to increase your chances of finding work.
With continued malaise in the job market, surviving job loss has become a new way of life for many individuals. No doubt, losing your job is a high-stress, difficult experience to deal with. There’s nothing more worrisome than having unemployment benefits expire before you’ve lined up a new job. However, by making a plan and executing these tips, you can use your current situation (if you’re unemployed) as an opportunity to get a closer look at your finances and to gain better control over your money. If you’re seeing the writing on the wall, then it’s best to be proactive. Who knows? There could very well be a better paying job for you right around the corner.
Created December 5, 2008. Updated February 1, 2012. Copyright © 2012 The Digerati Life. All Rights Reserved.