5 Money Moves to Make ASAP If You Lose Your Job

Whether that pink slip came as a complete surprise or departmental layoffs have been looming for months, losing your job sucks — emotionally, professionally, and financially. It’s also incredibly common: Nearly a third of American workers experience “layoff anxiety,” according to the Daily Mail. One poll for 2025.

“Going through these difficult career transitions is completely normal, and most Millennials will go through it more than once in their careers,” Sofia Pera, certified financial planner and founder of General planning Yhe told Mental Floss in 2016.

Of course, going from creating a bank to creating a popkey is enough to make anyone panic – no matter how many times you’ve done it. But losing your job doesn’t have to mean financial ruin (or a diet of ramen noodles). The trick is to be proactive about cutting spending and increasing savings—as soon as you receive the bad news. Here are the money moves to jump on:

1. Unemployment file.
2. Rack your student loans.
3. Contact other creditors.
4. Know your health insurance options.
5. Tighten your (budget) belt.

Unemployment file.

Let’s be real: Unemployment benefits won’t cover all your expenses. But now is the time to claim every penny of the help you’re entitled to. Benefit formulas vary by state, but most are based on a percentage of your previous salary, with a maximum weekly benefit. Each state has its own website detailing how to apply for benefits, as well as who to contact with questions. Get clicking.

Rack your student loans.

While you’re unemployed, you can defer any federal student loans — meaning you’ll be able to stop payments completely until you find a new job and the government will pick up the tab on any accrued interest. Your private student loans probably won’t be as generous, but you may be able to switch repayment methods so you pay less each month or move the loans to patience Until you find a job.

“People sometimes wait until they can’t make the monthly payment to contact their student loan providers, but the last thing you want to do is default on your loans,” Berra said. This financial mistake can destroy your credit and cost you more expensive fees and penalties.

You may also like…

Add the mental thread as Favorite news source!

Contact other creditors.

If you have a car payment or credit card bill, get on the phone and explain your situation. “All loan providers want to get their money’s worth, so they’re eager to work with you to come up with a repayment plan,” Berra said. “The first person you talk to may not have the authority to change the length of your billing cycle or lower the minimum payment, but if they do, ask to speak with a manager.”

Know your health insurance options.

COBRA is a short-term solution that allows you to continue with your company’s chosen health care plan, usually at a higher monthly premium. But paying big for COBRA isn’t always the best way to move money. If you’re under 26, you may be able to sign in to your parents’ insurance instead. (And if your younger siblings already carry them, the addition may not cost them a higher premium.)

If you think these layoffs may indicate a good time to start an independent business, you may want to compare store for coverage in your state. Health insurance exchange. And even if you find that COBRA is your best bet, there’s no rush. “You have 60 days from the day you lose your job to elect a member of COBRA,” Berra said. “And you can defer coverage if something happens, so for most people hoping to find a job right away, it makes sense to wait.”

Tighten your (budget) belt.

Examine your budget and eliminate anything that is not absolutely necessary. That might mean trading your expensive gym membership for a free run in the park or cutting the cable cord in favor of the Netflix subscription you split with your roommate. “Taking a hard look at your spending may also prompt you to make some tough choices, like not going to your friend’s wedding this summer,” Bera said. “Your friend might be mad at you at first, but he’s being tough. That’s life, and that doesn’t happen. It’s not worth putting a destination wedding on your credit card — especially if you don’t have a job.”

One unexpected benefit of cutting back on your spending, she said, is that you may find that you don’t miss daily splurges as much as you thought you would. This means that when you get your next job (and you will!), you can stick to the reduced budget and put more of your new salary toward savings.

A version of this story was originally published in 2016; Updated for 2025.