Financial steps to take if you are laid off

Maybe you had a feeling it was coming, or perhaps it took you by complete surprise. Either way, getting laid off is not a fun reality to contend with.

Lately, more workers have found themselves faced with layoffs amid the Trump administration's plans to shrink the federal government. "A sweeping wave of terminations has already affected thousands of employees at agencies including the Veterans Affairs, Energy and Education Departments," and in mid-February, President Trump "signed an executive order directing agencies to prepare for 'large-scale' reductions in force," said NPR.

While remaining gainfully employed may sometimes be out of your control, there are steps you can take to minimize how far off track your finances will get following a job loss.

The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

Apply for unemployment benefits

If you get laid off, "file a claim with the state you worked in as soon as possible" to start receiving unemployment benefits, said NerdWallet. "State unemployment offices may be overwhelmed during periods with a dramatic rise in claims," and as a result, it could "take several attempts to file" and "benefits could be delayed."

You can easily file for unemployment benefits online through your state's website, which you can find through the Department of Labor. If you have questions or need any assistance, reach out to your state's unemployment office.

Assess your finances

With your application for unemployment benefits submitted, sit down to review your financial situation, which will likely shift without a regular paycheck coming in. "For starters, consider what assets and savings you can draw from," such as an emergency fund, said CNBC Select. From there, you'll want to "take stock of your expenses," determining what is essential (and how you can cover it) and what costs you may be able to cut for now.

Let your bank and lenders know

If your financial review leaves you concerned about your ability to stay on top of bills in the coming months, reach out to your bank and any lenders now. They may be able to offer some relief.

"Your credit card issuers and utility companies may extend your payment due dates or offer hardship programs if you're proactive and ask for help," said NerdWallet. Additionally, "student loan debt often comes with options to pause payments during a layoff," which could "help free up cash for the things you can't delay, like food and possibly rent."

Research your health insurance options

When you lose your job in the US, your health insurance coverage goes with it. If that is the coverage you relied on, first "find out when that coverage ends — it could be on your last day, for example, or it could last several months after you've left if you have a generous severance package," said The New York Times.

From there, consider your other options for getting covered. "The easiest and most familiar" is continuing your coverage through COBRA, but it is also "typically the most expensive option, often prohibitively so," said the Times. Other possibilities include coverage through your spouse or domestic partner, the Affordable Care Act marketplace or Medicaid.