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6 Financial Steps I’m Grateful I Took Immediately After Losing My Job

I live and work in the most expensive city in the United States, San Francisco. Or, rather, I live and worked in San Francisco. I just got laid off from my job of four years. In the 24 hours after finding out about my layoff, I was understandably panicked. Unlike my friends who’d been laid off from tech startups, I worked in the nonprofit arena, where layoffs are less common, and often unheard of.

The first couple of days after finding out about the layoff were rough. I felt financially insecure, despite all my best efforts in my mid-to-late twenties to become a financially-responsible 31-year-old woman. I prided myself on having a great credit score and very little debt, making monthly contributions to a 401(k), and having an emergency fund stashed away. I felt very privileged to feel as comfortable in my finances as I did. I lived with my parents for six years after college. Living at home saved me the cost of San Francisco’s notoriously high rent, and afforded me the flexibility to house sit, pet sit, or babysit to save some extra cash. Due to this hyper-vigilance around my finances, I was able to save up a nest egg that I was hoping to use to someday put a down payment on a house (rather than use it as an emergency fund). Despite working in the nonprofit arena and not being paid nearly as much as my tech worker friends, I felt cautiously optimistic about where I was, financially.

My optimism started to diminish in the days following the layoff. I felt like I was no longer in control of my finances, and like I didn’t know what would happen next. In an effort to feel more in control of my finances and feel more financially secure in the wake of my layoff, I did the following six things to make sure that I was prepared:

1. I took stock of my net worth.

I don’t know about you, but when I think about my overall finances, I think of each element independently. I have a 401(k). I have a savings account. I have a checking account. I have a credit card. I have stocks. I have EE bonds that my grandparents gave me as a child that haven’t fully matured. I have all of those things, but I think of them as separate from each other. Thinking this way made me feel like I did not know where I stood financially. So, I made a list. I logged in to my banking website, and wrote down exactly what I had in savings, what I had in checking, and where I stood debt-wise with my credit card. I logged in to my former work’s retirement website and wrote down exactly what I had in my 401(k). I logged into my brokerage account and wrote down what I had in stocks, and how much I’d rolled over from my previous job’s 403(b) account into a Roth IRA. This is going to sound crazy, but I also looked through my wallet and tracked the cash I had in there, as well as the small emergency stash I kept in my apartment. I wrote down every one of these amounts. I added all of these numbers up in three columns: liquid cash, retirement, and debt.

Once I had all of these numbers added up together, I had a full picture of exactly where I stood financially. This helped me calm my nerves and know where my starting point was. I fully acknowledge that having money live in multiple places like mine does, is a completely privileged place to be, and that not everyone would be in this place if they get laid off.

2. Liquidated credit card points to cash (or use for a flight home).

Though credit card points take a long time to add up, it had been a while since I’d converted mine into cash or used them to pay for a flight. Because of this, I was able to convert a large portion of them into cash. Through liquidating my points into money, I could now use them for daily purchases like groceries or basic needs. Though the points didn’t convert into a large amount of money, the money that they did convert into was free and useful.

If I hadn’t lived so close to my parents, or if I’d been in a more dire financial situation, I would likely have used my points in a different way. I would have instead used them for a flight home or for moving expenses.

3. Cancel or suspend memberships that are not vital.

I had to prioritize which parts of my discretionary spending were essential, and which really weren’t. This was a pretty difficult process, because I really didn’t want to minimize my streaming options (Amazon Prime, Hulu, and Netflix) or to things like my basically unused gym membership (what if I suddenly became one of those fit people who love going to the gym?).

I took stock of what I actually use on a regular basis and decided to make the following changes:

  • Suspend my Hulu account for four months.
  • Suspend my gym membership for six months.
  • Keep Amazon prime (but only because I’d already paid a year-long membership fee).
  • Keep Netflix (Since I don’t have cable, this is my only way of watching TV or movies).

In lieu of my gym membership, I dedicated myself to a minimum of three-hour-long walks a week and a goal to check out the local city pool (which costs $5 per visit).

4. Utilize unused gift cards.

As with my quest to determine my full net worth, I scoured my apartment looking for any unused gift cards. I’m the type of person who hoards these and tends to wait to use them for something big…and then completely forgets about them. This is a horrible habit, but ended up working in my favor after my layoff.

I used the the gift cards as guilt-free money or money to buy essential things that would move me forward in my career search. For example: I’d been given a fairly large gift card to Target by my previous employer, which I used to buy a printer scanner, since I’d need to be able to print out resumes and other important documents.

5. Apply for unemployment.

The first thing my dad said to me when I told him that I’d been laid off was, “There is no shame in applying for unemployment. You’ve paid into the system. This is what it is there for.”

If you’ve been laid off, or have had your hours drastically reduced, you have the right to apply for unemployment or underemployment. The system is easy to navigate, and it really only takes about an hour to apply. You’ll need:

  • Your personal information, including address, phone number, and SSN.
  • Your former employer’s phone number, mailing address, and actual address.
  • Your last day of employment.
  • The amounts of your previous 18 months worth of salary. This will be broken down into quarters. So, even though you may not have been paid in quarters, they have tools to help you do the math on how much you made each quarter.
  • The total gross amount of any money you’ll be receiving for holiday or vacation pay out (If you live in California like I do, then it is required by law that your employer pays you in full for any unused vacation days).
  • The gross amount of any money you’ll be receiving as part of a severance package.
  • A willingness to fill out a weekly form showing that you’ve consistently been looking for work.

It takes about a week to hear back about how much money you can expect to receive. It usually maxes out at 50% of your former salary. You will only receive money (at least in the state of California) while you continue to fill out a weekly update form showing that you’re constantly looking for work, and not rejecting work you’ve been offered within your field.

6. Create a well-thought-out meal and shopping plan.

For the time being, I’m home applying for jobs. This means that I have to be even more frugal than usual about my spending. The biggest line item on my usual budget (aside from rent) has always been food. So, I found it important to really think ahead with meal planning, so that I was not only using up all of the food I was purchasing (and therefore not wasting food or money), but also that I wasn’t getting sick of the food I was preparing for myself. I made a goal to try at least one new recipe a week and to wrap my other food purchases around meals that worked well with that dish.


Though I still feel unsure of what is coming next, and nervous about my unknown sources of future income, taking these six steps gave me a better sense of control over my situation. Being laid off is scary, no matter where you stand financially. I know that I will have to work hard to find my next role. These six steps are giving me the flexibility to find my perfect next role.

Image via Unsplash

Laura Beam McKinney is an educator and illustrator living in San Francisco. In her spare time she enjoys cooking, swing dancing, drawing, and sometimes remembering to update her food blog, Delicious Arthritis.

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  • Lauren

    This is such a great article. I’m sorry about your job but it sounds like you’re being as pragmatic as possible. Employment is very hard — harder than employed people like to acknowledge, because it is definitely NOT “vacation” time. I appreciate you sharing your story!

    • Laura Beam McKinney

      Thank you for your kind words! Unemployment certainly isn’t a “vacation.” It is hard work!

  • Refinnej7

    Thank you for the tips! This is a great article to help others prepare in case it happens….I remember being laid off, but with farrrrr less preparation than you! I had no savings, tons of debt. It was certainly an eye-opener for me!!!!
    But I did similarly – I pared down my expenses as much as possible. I was a smoker, so I started rolling instead of buying premade (yes, still an unneeded expense, but I was *stressed*. No way was I going to quit smoking at that time!). If I was going somewhere within 1 mile, I walked. Within 5 miles, I biked. I air-dried my clothes. I ate once per day. I bought the cheapest coffee I could find. I switched to cheaper internet. It was summer, but I’m pretty sure that once the sun went down, I kept my lights off as much as possible. Every little bit helped!

    • Laura Beam McKinney

      Thank you! You’ve got some great tips as well! Every little bit certainly does help.

  • honkytonkdreams

    I appreciate this article so much because this JUST happened to me, too. My entire department was eliminated last week. I’m also in a very similar financial situation: I live in high-cost California and have worked hard to pay down debts and build up my emergency savings. It is a bummer to have to deplete that fund for the utility bill instead of something that could actually build equity!

    I can’t say good enough things about using the Personal Capital website to track net worth and spending. Having the spending categories calculated automatically really helped me get a grasp on where I was leaking money each month, and I’ll be leaning on it extra hard as my income stagnates. Being able to see the “full picture” was reassuring. Even if I never want to borrow from my 401k, it’s nice to know that I have a chunk of money…somewhere.

    I’d also add that if you are losing employer-sponsored healthcare and need to enroll in an ACA plan, find a qualified private insurance rep who can walk you through the process of choosing the best plan. Even after talking with a direct ACA rep, I was really overwhelmed by all options until a friend connected me with another friend who was ACA certified through her job as a private employee benefits insurance manager. Doesn’t hurt to ask around or look for a qualified rep on the Covered California site.

    Good luck and stay strong! You’ve clearly got a logical approach to solving problems, which will be enticing to any employer!

    • Laura Beam McKinney

      Wow! Thanks for the kind words and the advice about the ACA rep. It is something I hadn’t thought about before and that I’ve been feeling a little overwhelmed about. I really appreciate that suggestion!

  • Anon

    Good luck!

  • Leslie Scott

    While I wasn’t laid off, I’m going through a divorce which can have similar effects on one’s finances. I’m going to take your advice on several points to stabilize and improve my financial standing. Great article!

  • Mike

    A general thought about #2: It’s never a good idea to let rewards points pile up for very long. It’s a common practice for companies to periodically de-value these, to reduce their liabilities. Almost every contract says they can change the terms whenever they like. Use them as frequently as you can. Best of luck to you!