Job loss money moves
Slash your budget. Clients faced with a job loss can get overconfident, reasoning that their experience and skills will help them easily land a new job, said Reardon. But that may not be the case. Recalibrating your budget right away helps stretch your savings so you can job hunt and put off more desperate moves such as downsizing or tapping retirement funds.
“You need to scale back now, so [that] in six months you haven’t exhausted that emergency fund,” he said.
Reprioritize goals. One of the hardest concessions for parents to make is that a job loss might limit their ability to help their kids with college costs and other expenses, said Linda Rogers, a CFP and owner of Planning Within Reach in Memphis, Tennessee. But it’s important to reassess, and have those tough conversations with your kid about how your job loss could affect their college plans.
“We think you should be taking care of yourself first, your retirement first,” she said.
Assess timeline and tradeoffs. Take a hard look at your finances to figure out how long your savings can hold out as you job hunt, Stanzak said. That can force your hand on what kind of job you might accept, and whether you’ll need to open your search to lower-paid positions, other fields or a different city.
“To what degree do you settle for something less, and how long do you wait?” she said.
Be open to stop-gap income. While you’re looking for career work, think about other ways you can bring in money to cover expenses. One of Burke’s clients is currently driving for Uber while he job hunts; Stanzak’s friend taught classes at a nearby community college and bartended on weekends until a job offer came through. A client of Rogers picked up work — and health insurance — as a Target employee.
“And she loves it,” Rogers said. “Be open to other opportunities. They might unexpectedly fill a need.”