What to Do if You’ve Been Laid Off

Documents for getting ready to apply to jobs after being laid off
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If you’ve been laid off from your job, it may not be clear what you should do next. From filing for unemployment to re-evaluating your monthly budget, there are a few steps that you can take right now to make the most of your current situation.

In this article, we’ll walk through seven things that you can do to maintain financial stability and re-enter the job market as strong as ever. 

7 Things to Do if You’ve Been Laid Off

The way that you approach being laid off will vary based on how much you were able to prepare. Still, whether you had time to build your savings or the layoff has you feeling desperate, these seven steps will help you make the most of unemployment:

  1. File for Unemployment
  2. Prioritize Your Spending
  3. Figure Out Health Insurance
  4. Contact Your Lenders
  5. Gather Paperwork From Your Employer
  6. Update Your Resume
  7. Look for Available Work

These steps are essential for protecting yourself financially during a layoff and preparing to re-enter the job market.

1. File for Unemployment

If you’ve been laid off, the first thing you’ll need to do is file for unemployment. This process varies based on where you live. If you aren’t sure where to get started, see our guide on how to file for unemployment. You’ll find a list of everything you’ll need to file and the link to your state’s unemployment website. 

Be sure to complete this step as soon as possible. “The more you delay doing that, the longer it’s going to take for you to see money,” says Clark Howard. “If you don’t file, you don’t get.”

In addition to filing, be sure to take advantage of any unemployment benefits offered by your job in the event of a layoff. You may be eligible for a severance check or other financial compensation.

2. Prioritize Your Spending

As soon as you’re laid off, it’s crucial that you stop all unnecessary spending especially if you aren’t sure how long you’ll be laid off. Instead, focus on your essential spending like food, your rent or mortgage payments, and utilities.

“If you’ve already been laid off, everything is triage. Basically, you have to decide what you save and what you don’t,” says Clark. “With your bills, you’re going to have to make very tough decisions. 

Take the time to look at your monthly budget. Once you’ve determined what your essential payments are, begin eliminating or reducing expenses in other categories. Here are a few examples of easy ways to cut down on monthly spending:

  • If you have any recurring subscriptions or memberships, cancel them now
  • Look for cheaper service providers to reduce your monthly bills
  • Start using coupons, rebates and discounts for groceries and other essential shopping

Also, if you’re paying off credit card debt or you normally pay your balance in full, you may need to consider dropping to only the minimum payments during this time. Being laid off won’t last forever, but having flexible cash could be a lifesaver during a period of unemployment.


3. Figure Out Health Insurance

If you had health insurance through your employer, you may need to figure out new coverage. 

Having lost your job-based health insurance, you’ll be eligible to sign up for a new health plan even if it’s not within the annual open enrollment period. You’ll have 60 days from the time you lose your job to enroll in a new health plan.

To find your best options for health care, utilize the resources available at healthcare.gov. You may be eligible for COBRA continuation coverage from your former employer. Be sure to also check out available Marketplace plans and see if you qualify for Medicaid or CHIP coverage.

4. Contact Your Lenders

Once you’ve figured out exactly what your essential spending is and how much you’ll have after those payments, you may find that other bills will have to go unpaid. If this happens, just keep in mind that early contact is key

Get in touch with the lenders of your mortgage, credit cards, vehicle loans, etc. and talk to them about your options. You may be able to find some flexibility with regard to interest rates or payment schedules. 

While reducing or skipping payments may affect your credit score sooner or later, it’s most important to maintain your priorities during a layoff. In any case, be sure to contact the lender and explain the circumstances before delaying or missing a payment.

5. Gather Paperwork From Your Employer

Tying up loose ends with your former employer is another important step. You’ll need to collect your final paycheck, find out what’s happening to your retirement and gather any references you may want for your next job search. 

In addition to your final paycheck and references, you may also need to request a document from Human Resources stating that you’ve been laid off. Check the specific requirements of your state to see if this is necessary.

If you’ve invested money in a 401k, what you do with it is up to you. “If you’ve been terminated, that money is available for you to withdraw and use as you wish or move it to an IRA, which would be the better move,” Clark says. “Then, you only withdraw what you actually have to have to live on.”

6. Update Your Resume

In addition to maintaining your finances, you may also need to prepare for a new job search. Before you begin applying, take the time to prepare your resume and add any recent promotions, certifications and achievements. 


“Update your resume to be as current as possible,” says Brie Reynolds, Career Development Manager and Coach at FlexJobs. “Look at current job descriptions for your type of work. What are you missing?” 

For more ways to improve your resume, check out these secrets to resume success. You’ll find nine tips to make your resume stand out, including how to rework your objective statement, what to include in your areas of expertise and what to leave off.

7. Look for Available Work

Once your resume is up-to-date, begin looking for your next job! Networking and job posting sites are both great ways to discover new available opportunities. 

Reynolds recommends updating your LinkedIn profile and starting to connect with potential employers, clients and other professionals. “Send messages to people in your network who you feel may be able to offer help,” she adds. “And start making new connections.”

The Department of Labor also offers occupation statistics in addition to job search tools and resources. You can also explore legitimate work-at-home job opportunities for more employment options.

Final Thoughts

Keep in mind that being laid off probably won’t last forever. Still, if you find yourself unemployed, be sure to follow these tips to maintain financial stability and find your next job. 

First and foremost, apply for unemployment and prioritize your spending. You’ll also need to look into new health insurance, contact your lenders, and tie up any loose ends at your former job. Lastly, begin updating your resume, strengthening your network and applying for new job opportunities. 

Have you ever experienced a layoff? Share your best tips for keeping your finances in check and re-entering the job market in the comments below!

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