Life changes happen fast. Sometimes we’re in control, other times we’re not. One of the biggest changes we can go through is job loss. Many people are experiencing job loss right now, whether it be due to their own desire for change, or unfortunately due to being laid off.
Experiencing a job change or job loss can be a major redirection. It opens the door for many new questions that you might not have considered before. There are a few financial and insurance-related check boxes you’ll want to consider if you’re voluntarily changing jobs or if you were recently laid off. Read on to see how you can make this major life change a bit easier.
What to do When You Leave Your Job
After the initial stress of being laid off or changing jobs wears off, your mind will turn to what’s next. You’ll be looking for a new opportunity or considering your options with other employers. While you sort through these opportunities, you’ll also want to consider your financial situation and needs.
First, make a simple list to capture your situation and pieces of your financial puzzle that should be considered. These will include:
- Your financial situation. Does your new job need to meet or exceed your old salary or pay? If you’re considering moving to a job that offers a smaller salary or compensation package, ask yourself if this is something you can afford within your current expenses and financial obligations.
- Health insurance - what did your previous employer provide that you took advantage of? What do you need going forward? Do your new opportunities offer health insurance as a part of their compensation package, or do you need to seek a private health insurance plan?
- While we’re on this topic, a friendly reminder to submit any outstanding claims to your old provider. There’s typically a window of time in which you can submit claims for reimbursement before your coverage officially ends. So, dig out those receipts!
- Take advantage of spending accounts before you lose access to these as well. Don’t leave money on the table if you can help it.
- If you’re married or in a common-law relationship, you might be able to get coverage under your partners’ health insurance plan (if they have one). This is worth looking into if you’re not already listed as a dependant on their plan.
- Life insurance - some employer provided plans will include life insurance, and some won’t. Based on your situation, consider if this is something you need going forward. Perhaps your new opportunities offer it as a part of their compensation package, or maybe you need to seek an outside plan. Consider your financial situation, your family situation and dependencies when you’re adding this item to the list.
- Pension - some employees get a pension through their employer. If you’re laid off or choosing to pursue a new opportunity, be sure to consider what happens to those pension funds and what you need to know about accessing them in the future. If having a pension through your employer was a major draw for you, you’ll want to consider this as you figure out your next move. Some employers will offer this while others won’t. Add it to your list of considerations when evaluating new opportunities.
- Unemployment benefits - if you’ve been laid off in Canada, you might be eligible to receive unemployment insurance. If there’s uncertainty about when you’ll be able to line up your next job, it’s worthwhile to see if you’re eligible to collect EI while you work through that transition period.
Ways to Protect Yourself Against the Impacts of Job Loss
You can only deal with the cards you’re dealt. If you recently lost your job, we hope the above tips can help you feel more stable in your financial position while you consider your next move. But if you’re thinking about changing jobs soon or want to protect yourself against the possibility of losing your job, there are a few things you can start doing now.
- Save! This might seem obvious but it’s true - start or continue to add to a savings account that you can dip into if you find yourself laid off. Financial experts recommend saving three to six months’ worth of expenses before voluntarily leaving a job so you’ve got a cushion to live off of while you transition roles. Consider it an emergency savings fund that you keep for a rainy day. Hopefully you won’t need it and those savings can eventually be moved elsewhere, but having a savings account like this will be a good buffer to have in place if you’re in-between jobs.
- Leverage your existing assets - if you’re planning on leaving your job and don’t know if you’ll have another opportunity lined up right away, another option to consider is applying for a home equity line of credit if you’re a homeowner. You’ll need existing employer pay stubs to secure this, but these typically come with much lower interest rates than credit cards.
- Remove areas of unnecessary spending - in the same vein as saving, consider the expenses you have in your life that you could reasonably manage to cut out to save some more of your current income. This will help you now to save but also in the future if you do find yourself in a job loss situation - your expenses will already be trimmed down. Have a look at those streaming subscriptions, reconsider your eating out habits, and think twice before you make a big purchase. In our current climate with high costs of living, it doesn’t hurt at all to cut back on these areas if you can.
- Network and keep that resume up to date - continue to grow your professional network, even while still employed, because it never hurts to have connections you can lean on down the road. Keep your resume up to date so you don’t have to scramble to do this if you lose your job unexpectedly.
Looking Forward After Job Loss
If you lose your job or your new opportunity doesn’t cover health benefits, you’ll want to consider your health insurance options. You shouldn’t have to compromise on health needs because of job changes. If you recently left your work benefits plan, GMS offers two private health insurance options. Both Replacement and Personal health coverage offer three plans that fit a variety of needs and will help you stay healthy while life is in flux. And soon, that will sort itself out too.