What To Do if You Lose Your Job

Nearly 15 million Americans are currently out of work and in August 2009 the national unemployment rate rose to 9.7 percent, reflecting the highest national level of unemplyment since 1983. If you or a family member finds yourself facing the financial challenge of losing a job, consider following these important steps:

Do not panic

Keep the lines of communication open with family members and friends. Identify what difficult choices might be necessary to help you deal with this temporary financial setback. Put the word out that you are in the job market and follow all leads. Try to negotiate a severance package with your employer, including pay, job search assistance and other benefit extensions.

Focus on developing short and long term plans for meeting expenses, and take advantage of available resources. You may be eligible for State assistance programs to help meet your family’s needs.

File a claim for unemployment insurance benefits

Most workers are covered by unemployment insurance, which is a benefit paid by employers. This provides temporary income for eligible workers who become unemployed through no fault of their own and who are willing and able to work. You earned this benefit while you were working, so you should not hesitate to use it to help meet expenses as you look for a new job.

Eligibility is determined based on your work and wages.
It is important that you file your unemployment insurance claim as soon as possible – ideally as soon as you find out that you have become totally or partially unemployed. This is important because your first week is unpaid, and any delay may cost you benefits. The New York State Department of Labor provides guidance on how to apply or call 1-888-209-8124.

Extend your health insurance coverage

Remember to take good care of your health. If you were covered under your employer’s group health insurance plan, the federal Comprehensive Omnibus Budget Resolution Act (COBRA) may allow you to continue your health insurance for up to 18 months after you lose your job.  Your employer must inform you of your right to extend your health coverage, and you have a limited timeframe to decide to do so.  You may have to pay premiums more expensive than before, but it gives you time to find other insurance.  Visit the New York State Insurance Department website to learn more.

An alternative to extending your existing health insurance under COBRA is New York State’s HealthyNY Program, which provides low-cost health insurance to eligible individuals. HealthyNY may provide fewer benefits but might be a lower cost option than extending your existing coverage under COBRA. You may also call 1-866-HEALTHY NY (1-866-432-5849) for more information on this and other programs.

Organize your job search

Update your resume to highlight your strengths and experience and reach out to contacts that may be willing to provide letters of recommendation and serve as references. Use the internet or your local library to research effective interviewing and negotiating techniques. Update and expand your skill sets. Start exploring employment opportunities: use job search engines like the one that is available through the New York State Department of Labor, newspapers and other resources.  

Other assistance

If you have some financial flexibility, you may be interested in seeking out further education and training. The website www.opportunity.gov is designed to help unemployed Americans of all ages who want to return to school. The site covers information on grants, loans and alternative education programs.  

The IRS provides information on tax benefits for job seekers, including information on deducting job search expenses. The IRS outlines rules for deducting expenses such as employment agency and career counseling fees, as well as travel expenses to and from job interviews. There are some requirements you must meet, such as the job must be in the same occupation as your previous employment and expenses must add up to more that 2 percent of your adjusted gross income. Also, your first job search does not qualify.

 

Next: State Resources for Tough Times