It's never a bad time to prepare for the unexpected.
Here's how you can shore up your financial, career, and emotional health to secure what counts if you're not sure you can count on your job.
The money stuff
1. Beef up your emergency savings Having emergency savings set aside can be a lifeline. Start by saving $1,000 and eventually aim to stash away 3 to 6 months of essential expenses. “Make sure that you understand what your essential versus discretionary expenses are,” says Aliya Padamsee, CFA, CFP®, a director of Financial Solutions at Fidelity. Groceries? Essential. More than a couple streaming platforms? Maybe not. The more discretionary bills you can cut, the bigger the buffer you can create.
2. Research unemployment benefits in your state While you’re figuring out your emergency savings needs, consider factoring in money you might be eligible to receive through unemployment benefits should your job situation change, says Beau Zhao, CFA, a director of Financial Solutions at Fidelity. Benefits vary from state to state and by your most recent income.
3. Put the credit card away Padamsee and Zhao agree that you should try to avoid racking up credit card charges that you can’t fully pay for each month. You don’t want to accrue interest. You may also want to hold off on unnecessary major purchases.
4. Research rules around severance and paid time off Dig into your employee handbook or any employment contract you signed for details about severance and PTO payouts at your company. You may be entitled to regular payments for some time if you're terminated, as well as a payout for unused vacation time. But not all companies will pay you for those days. If yours won’t, you may want to plan days off ASAP to take advantage of your benefits.
5. If you have a 401(k) loan, make a plan to pay it back Your company may require you to repay your loan’s outstanding balance in full immediately if you leave. If you can’t afford to pay off the loan balance in full at that time, your employer will report the loan’s balance to the IRS as a taxable distribution. Translation: If your loan defaults, you will be on the hook for penalties and taxes. Check your plan rules to see whether you are allowed to continue to pay your loan after separation.
6. Research new health benefits coverage Even though you might be able to stay on your employer’s health plan through COBRAOpens in a new window should you lose your job, it’ll cost you up to 102% of the unsubsidized premium. That could be hundreds or even thousands of dollars per month. It’s worth looking at the public marketplace, private plans, or, if you have a partner, their plan. You may also qualify for premium tax credits on the public marketplace, which would reduce your overall health care costs. If you’re concerned about your family’s future coverage, check out your state’s rules for CHIP, the Children’s Health Insurance ProgramOpens in a new window, which offers low-cost coverage for kids in qualifying families.
7. Get medical checkups and fill prescriptions That goes for everyone in your family—including eye and dental care. Even if you’re able to get new health coverage quickly if you lose yours, your co-pays, deductibles, and doctor network may change. So make sure your doctors and prescriptions are covered under the new plan, otherwise you will end up footing the entire bill—more reason to make those appointments and refill medications now.
8. Track down your receipts to get paid back If you have receipts for qualified medical expenses to get reimbursed for from a flexible spending account—or receipts for work trips, classes, or any other activities you can expense—turn them in ASAP. While you may be able to submit receipts after a layoff (and your company should reimburse you for those receipts), it’s easier to do while you can access company websites.
The career stuff
9. Gather contacts at your current job Collect your colleagues’ info, so you can tap them as references when you apply for new jobs. Just be careful about breaking any agreements you signed, such as not soliciting clients after you leave. You might also want to add phone numbers and email addresses for HR and payroll in case you need to reach out after you’ve left the company.
10. Add your personal email address to important accounts Make sure your work email is not the primary (or only) address listed for important accounts you’ll want access to later, such as professional networking sites and your 401(k). You’d most likely lose access to that email address immediately after leaving your employer, which could make it harder to sign in.
11. Update your resume and job-related profiles While your recent achievements are top of mind, edit your resume, personal career website, and any online profiles. Hiring managers are more interested in seeing quantifiable achievements and how you hit those marks than a list of job responsibilities. So try "Grew revenue by 20% in first 6 months by broadening prospect targets" rather than "Made sales calls." If it’s not against your company’s rules, ask colleagues to provide recommendations and endorsements on online talent platforms, so they’re available by the time you’re applying for new gigs.
12. Save work documents These include examples of your work and positive feedback from peers and managers—just nothing confidential or anything that your company prohibits you from accessing off their network. You can upload these with your future job applications or print them for a portfolio to bring along on in-person interviews to help you stand out from a crowded candidate pool.
13. Know your worth Research salaries online for similar roles in your area to check if your current income is in line with the going rate. Then you can more easily see which potential future employers are willing to match your worth and confidently go into applications and negotiations with your target salary.
14. Network If you have conversations while you’re employed, you’ll have a foot in the door with people who can help you navigate your job search when you might really need it. As for contacts you already have, the best networkers stay in touch while they’re working, so when you reach out if you become unemployed, those people will be more inclined to help.
15. Consider new titles and industries Be open to a new role that isn’t necessarily based on what you’ve already done. To plan for a shift, you could ask to shadow colleagues who can teach you a new skill, sign up for classes, or network with people in areas that interest you. Then make sure your resume for jobs in this new career reflects all of your newly acquired relevant skills and experience. Leave space on your resume to connect your transferable skills and experience to the opportunity at hand too.
