Losing your job is a huge hurdle to overcome, but it is one you can get through both emotionally and financially. If you’re wondering what to do when you’re laid off, follow these four steps to help keep your money on track until you find a new job.
Sign Up for Unemployment
When you’ve lost your job, have no money and don’t know what to do, the first step is to see if you qualify for unemployment benefits.
Specific unemployment qualifications vary by state but in general, you may be eligible if you were laid off for reasons that weren’t your fault.
So if you quit or you were fired for misconduct, you can’t collect unemployment. You may also be disqualified if you don’t meet time requirements. In most cases, you need to be with the employer for at least a year. There might be some earnings requirements as well.
Reasons for termination that may still allow you to qualify for unemployment include: company cutbacks and poor job performance. [2] Your unemployment benefits likely won’t amount to your entire pay, but can help tide you over until you find a new job.
Check Your Health Insurance
As soon as you lose your job, find out how long you have access to your employer’s healthcare plan, which may come with a grace period. Then it’s important to find new coverage.
Job loss qualifies you for special enrollment in the federal healthcare marketplace. You have 60 days from the time you lose your job to apply for marketplace healthcare.
Pare Down Your Budget to Essentials
With your unemployment benefits and health insurance settled, it’s time to work on your budget. When you lose your job, focus only on the necessities that help you live and avoid further financial distress.
Housing, food, insurance, and loan payments are your top priorities. Then you can find things to cut back on, like going out to eat, unlimited cell phone data, and subscription or streaming services.
Follow Up With Creditors
It’s always better to contact your creditors before you fall behind on your payments for things like your mortgage, car payment, credit cards and student loans. As soon as you think you won’t be able to make your payments on time, call each creditor directly. In many cases, they may work out a temporary payment plan so you can stay current on the loan.
