The 5 Things You Need to Survive a Job Loss

by Megan Brame on 15 January 2014 1 comment

Losing a job can be one of the most challenging struggles a person can face in this — or any — economy. Many people feel lost and unprepared for such an abrupt change in their lives, but it doesn't have to be that way. Having a thorough plan can help you deal not only financially, but mentally, too. Here are some things you need to have ready in case of an upheaval in your professional life. (See also: Help! I Lost My Job!)

1. Savings

The general rule of thumb is to be sure you have three months of savings ready to go at all times in case of job loss or other emergencies. However, this number is not set in stone, and in the new economy, many advisors suggest that saving as much as a year's worth of expenses is the best route to go. Check this guide to calculate what you need. Deciding how much savings to keep depends on a number of factors, such as the demand for your skills in the marketplace, your budget and expenses, and other sources of household income (such as from a partner or spouse).

Begin saving bit by bit, putting your money in a place that is hard to access, like an online-based account. There are many online savings accounts that also carry decent interest rates, which can make your emergency savings work for you. (See also: 5 Best Online Savings Accounts)

2. A Large Network

If you aren't the "social butterfly" type, now is the time to get out there and expand your professional network. If your job suddenly is taken away, the old adage "it's not what you know, but who you know" will come in to play more than ever. Make sure you have a reliable network of colleagues. Your network can be your most valuable tool in a professional crisis.

Start by going on LinkedIn and finding groups of people in similar professions in your area. EventBrite and MeetUp also are great resources to help build your professional network. (See also: Hidden Networks That Can Help You Land a Job)

3. An Updated Resume

A resume showing your most recent skills and experience is a powerful tool that will take the least amount of effort on your behalf. If you suddenly lose your job, the time you take to update an old resume could have been spent looking for new contacts and new jobs. Always have an updated resume at the ready. (See also: Get Your Resume Past the Resume Filter)

Take the time to not only update the text in your resume, but also the appearance of your resume to help it stand out, especially if you're in a field that's design-related and is highly competitive. If renovating your resume feels like an overwhelming task, here's a guide to help you focus on what to tweak and where.

4. A Strategy (With Your Partner)

If you feel that your job might be compromised in the near future, it's best to discuss this with your partner. Waiting until it actually happens can send everyone into crisis mode and, let's face it, many people can't think clearly when in crisis mode. Lay out expectations, and have a plan B ready that includes at the minimum an emergency budget showing where you can cut costs in case your fears do become reality. And if you're single, it's even more beneficial to you to have a plan laid out, as there may not be a secondary source of income supporting you.

5. A Thorough Understanding of Your Benefits

If you are let go, it's important to know what the company is offering you as a settlement. Can you and your family count on health insurance for a few more months? Is there a sum of money that you can expect to sustain you for a little time? What happens to any retirement funds that were through the company? Get written information that explains in detail what you're entitled to if you're laid off.

Have you been laid off or let go from a job? How did you get through it?

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Donna Freedman's picture

Yep: When MSN Money laid off all its writers simultaneously last September. Due to that network you mentioned I had a replacement gig within a couple of hours -- but not at the same pay rate. That's why having an emergency fund was essential, as was my ability to stretch a dollar.
If it's kosher to post URLs, here's how it went for me:
http://donnafreedman.com/2013/09/12/termination-dust/