Navigating the Unexpected: Layoffs & Unemployment

While almost everyone can agree that life is full of incredible and unimaginable wonders, life will bring myriad challenges, and you’ll have to work through them. Coping with unemployment means breaking away from the past and facing your future. It means dealing with new emotional, financial, and professional challenges. Although this process can be painful, facing unemployment with a plan will help make coping easier.

The Emotional Experience

Losing your job is an emotional experience – whether you are laid off, fired, quit, or retired. Although you’re entitled to relax awhile after your job ends, it’s easy to let a few days of sleeping late, watching television, and recreation turn into a few months of inactivity. Be careful not to use your need for self-care as an excuse to avoid facing your future. The more time that passes, the more likely it is that anxiety will creep in and keep you from your future. Here are three tips on what you can do to keep yourself moving:

• Pretend that you’re still working. You’ve probably heard the adage that finding employment is a full-time job. Well, it’s true. According to a 2023 Teal article, it takes an average of 21 curated applications to receive a job offer.^[1] So why not pretend that you’re still working? You don’t have to wear work-appropriate clothing, but at least wake-up and get going like you would on a regular workday. Stop for lunch and then work again until late afternoon. Keep moving, and you’ll accomplish your goal of finding a new job with a lot less anxiety.
• Set daily and weekly goals. Get a calendar and write down what you want to accomplish each day for one week or more. Be specific and reasonable. Don’t write “call future employers.” Instead, write, “Call the human resource departments at five publishing companies.” Then, write down what your weekly goal will be. You might write, “Compile a list of five potential employers and send resumes to them.” Setting and accomplishing goals will help you feel in control of your fate and ultimately help you get a job.
• Reward yourself. Looking for a job is challenging, so reward yourself after a long day of job hunting. For instance, if you accomplish everything on your list by three in the afternoon, you can head to your favorite coffee shop for the newest seasonal beverage release.

Planning a Financial Strategy

If you have time to prepare for unemployment, you can take some steps immediately to help yourself.

• You can reduce or stop contributions to retirement or education funds and put the extra money into your emergency fund.
• Consider increasing your withholding allowances to reduce the amount taken from your paycheck.
• Review your budget to identify where you can lower or eliminate expenses for entertainment, dining out, and vacations.
• You can also reduce costs in small, cumulative ways: cancel subscriptions, eliminate extra phone services, and stop your cable service.
• You can negotiate with your creditors to lower interest rates or receive temporary deferments, and you can review your auto insurance policies to see if increasing your deductibles or dropping certain coverages makes financial sense.

Unemployment Benefits

If you are being terminated for any reason, find out if you will receive severance pay and what unemployment benefits
you may receive. You’re likely to receive severance pay if you are laid off, but severance pay is usually based on your years with the company. If you are laid off or fired, you may be eligible for unemployment compensation from your state. Your employer can give you the details. You should also find out when you will receive your final paycheck and if you’re eligible for compensation for vacation or sick days you didn’t use.

Insurance Coverage

If you work for a company with more than 20 employees, your employer must notify you and your spouse (if applicable) via first-class mail; you can continue your group health insurance coverage after your employment has been terminated (unless it ends because of gross misconduct). Under COBRA, you can continue your benefits for up to 18 months, and your spouse and dependent children may be covered for up to 36 months. However, you’ll probably have to pay the full premium plus a small administrative fee—your employer won’t contribute anything.

If you work for an organization with fewer than 20 employees, check your state’s laws to see if you can continue coverage. Some states have passed legislation that gives employees of small employers the right to continue their healthcare coverage for a specific time.

When you lose your job, you may also lose your disability or life insurance coverage. Although disability insurance is
rarely portable or convertible (you can’t take it with you or convert it to an individual policy), your group life insurance
policy may be.

Retirement Accounts

If you receive a lump-sum pension plan or savings plan distribution, decide where you want that money to go. It’s easiest if you authorize your employer to transfer funds directly from your retirement plan to another retirement plan you
have set up elsewhere. Although you may be tempted to withdraw money from your retirement account to provide
much-needed income, do so only if this is your only option.

Finding a New Job

Setting Realistic Expectations

It may take you longer to find a job than you think. You may have to update your resume, research job openings,
and interview more than once with a potential employer. According to an article from Flexjobs, finding a new job takes roughly 3-6 months.^[2] You may also have to decide whether to move to a different area if you can’t find a job locally.

Setting Up a Support Network

Networking can mean finding others who can support you emotionally when you’re unemployed or finding
individuals and printed materials to help you find a new job. You can find emotional support through friends,
relatives, job-hunters support groups, or Internet sites.

Many resources are also available to help you find a new job. You can find numerous books and newspapers at your local bookstores or libraries to help you determine your career goals, prepare a resume, and research companies in your area. You can talk to professional job counselors, headhunters, temporary agencies, or image counselors (sometimes you may have to pay them a fee) who can help you find job openings or line up interviews. You can even find jobs through the Internet or your friends and family.

Starting Your Own Business

Many people who have lost their jobs to company downsizing decide to start their own businesses and enjoy being in charge of their own company after years of working for someone else. If you are tempted to start your own business, be aware that most new businesses fail quickly, often due to a lack of cash flow and thorough planning.

With perseverance and sufficient planning, it is possible that your new business may achieve success.

Conclusion

Job loss is an incredibly challenging situation to work through, but having a plan, a schedule, and a support system can make finding a new job more manageable. Take small steps to reach your ultimate goal, and give yourself grace for the journey ahead. For additional insight, contact Sequoia Financial Group.

Sources:

1. https://www.tealhq.com/post/how-to-job-search#:~:text=For%20a%20typical%20member%2C%20of,increase%20your%20chances%20of%20success.
2. https://www.flexjobs.com/blog/post/how-long-should-a-job-search-take/