If you were handed the pink slip today, would you know what to do? Where would you start? How would you manage? If you’ve ever thought about this situation happening to you then read on. CNN offers the following suggestions:
Know What You’re Entitled To
It’s easy to overlook what you’re entitled to while you’re still thinking about how you’ll make next month’s mortgage payment. But just because you’ve been handed the pink slip today, doesn’t mean it all ends today.
Discuss this with your boss and refer back to your employee handbook on company policy and severance pay. We often don’t look at the employee handbook past the first week on the job, however, this comes in handy when you need to get clear on what you’re owed should your position get axed.
Tally your vacation and sick days, inquire as to company policy around compensation.
Vested stock options
You typically have 90 days to redeem them, again be sure to talk with your boss and/or HR about how to go about doing this. This means extra cash in your pocket that will help you get through the next few weeks/months.
If you’re a contractor get compensated for the remaining time on contract. Hopefully when you started, your contract clarified that in the event of a lay off that you would be compensated through the end of your contract.
You are entitled to COBRA, however this is often 102% of the original policy, still it’s best to have an option in place just in case of a medical emergency. Healthcare costs still remain the number one reason why the financially distressed declare bankruptcy. COBRA is pricey but worth it.
Another option is to look at your partner’s health care plan and determine the added cost of having you on their policy. Is it more than the COBRA plan, probably not, so this may be a better option as COBRA tends to be the most expensive option.
If you’re pretty healthy then an individual plan may be best for you if you have no disqualifying medical conditions that would dramatically increase your rates.
Join a union or professional organization that may offer discounted healthcare options for it’s members.
For example, NY offers subsidized programs for the self employed or low income individuals.
Hold On To Your 401k
Whatever you do, try not to raid your 401k, although I totally understand there are situations where this must be done. The reality is that it’s happening all over the country but if possible, leave this as a last resort.
Leave it in the account and roll it into a new IRA and continue contributing if financially possible.
Keep Job Hunting Receipts
These are tax deductible, remember to do this before April 15th as these and other tax related deductions are often overlooked. If you’ve been out of work for the last year then you need to look at expenses you incurred while on the job hunt.
If you know that you may not be able to make the mortgage payment or rent because you’re not out of work, start planning ahead through eviction, however in my world, if this were to happen the mortgage would get paid first and foremost. I need a roof over my head. If this won’t be an option for you then start talking to friends and family about staying with them while you get on your feet. This may not be the best option but it can often be the safest and better option financially than say a motel or shelter.
Tweak that resume, put the word out and reassess your skills. Here in the DC Metro area I know more than a few people who wait for it……walk dogs and pet sit for extra cash while they job hunt. This is a great way to meet other people in your situation while giving your the flexibility to job hunt and make some extra cash. It may not seem like it at first glance but trust me, there’s comradery when you’re all in the same situation.
Find out where the local social mixers are happening, go out and meet people. Jobs are often secured not through Careerbuilder but through networking with others who can help you out, especially now. I’d recommend reading Never Eat Alone which talks about the power of networking with a difference spin.
In today’s economy we’re faced with the worst happening everyday because of ongoing budget cuts and businesses failing left and right. Know your options ahead of time and WRITE UP A PLAN. If you’re in a high risk industry or know that your up next on the chopping block, then you needed a plan yesterday. Hop to it and don’t be left in the dark when the time comes.