Somehow everyone knows when they‘re about to be unemployed. Whether its downsizing, being fired, or being laid off you have a feeling it’s coming. This can wreck havoc on your personal finances if you don’t plan ahead a little.
The moment you know you’ll be losing your job starting looking for a new one. If it’s possible to look for a job while still employed, do so. Already being employed looks very good and gives you credibility. You also get negotiating power when it comes to salary. In your plan for unemployment it’s important to know that a job search takes 3-6 months. Unless you have six months worth of savings, you need to find a new job.
Now is also the time to update your resume. You shouldn’t rush through this since this is what employers will use to determine your worthiness as a job candidate. Send your resume to anyone who could possibly help you find a job. Posting your resume online can help too.
Your plan for unemployment must include minimizing your expenses and outgoing cash flow. Now is the time to save as much as possible and not spend anything that isn’t absolutely necessary. Cash flow is likely to be tight once you lose your job so you need to get a headstart when you can. One thing you shouldn’t do it dip into your retirement. You put that money away for a reason, don’t lose it now.
When the axe finally does come down, be sure to ask about a severance package. You need to know when you get your last check, whether you get paid for unused days off, and any other benefits you’re entitled to, and get a letter of reference. Finally, plan for next time. Build up your savings and be careful about your spending. Make sure any skills and certifications pertaining to your field are always kept current. If necessary you can even set up a second job in your spare time just in case.
