Okay, 2023…you can let up now. If you don't currently follow me on Instagram or subscribe to my e-mail newsletter list, you may not be “in the know” but in February of this year, I got laid off. It was a job I actually took out of necessity so I could afford to live on my own after my divorce. As it turns out, I fell in love with the job, my team, and my boss, so to be let go in the end was devastating. In this article, I'll argue why being laid off is good – for both your finances and your career.
I spent four months on the unemployment line until I decided to pivot (again) into a full-time career in real estate. I had a lot of time to reflect during those months, and it was anything but easy on my mental health. But while losing a job can be a challenging and stressful experience, it's important to recognize it can also present unique opportunities for personal and professional growth.
I'm a big believer that by shifting our perspective and embracing the potential benefits, we can navigate any difficult situation with optimism and resilience.
Why Being Laid Off is Good: Ways It Can Benefit You
1. Time for Self-Reflection and Personal Growth
One of the advantages of being laid off is the opportunity to take a step back and reflect on your career path. Use this time to reassess your goals, values, and interests. Explore new hobbies, take up a course, or engage in self-improvement activities that can enhance your skills and knowledge.
Being laid off can be a transformative experience that pushes you out of your comfort zone. Embrace the opportunity for personal and professional growth, as it can lead to a better version of yourself.
2. Networking opportunities
Losing a job often leads to an increased focus on networking or, at the bare minimum, more commiseration between colleagues who were impacted by mass layoffs. It can also be a bit lonely to be unemployed and home alone all day — even without the Zoom calls. This is why it's important to use the time to network effectively: attend industry events, join professional organizations, and connect with like-minded individuals. Building a strong network can stave off loneliness, and open doors to new job opportunities and collaborations.
3. Severance packages and unemployment benefits
I mean, it's better than being fired or quitting right? In most cases, being laid off comes with severance packages and unemployment benefits. These financial resources can provide a cushion while you search for a new job or explore alternative career paths. Utilize these benefits wisely to ensure financial stability during the transition period, because, at the end of the day, you don't know how long it will be until your next paycheck. Which is the scariest part of being laid off.
4. Opportunity to reassess all aspects of your job and work-life balance
Being laid off can motivate you to revamp your job search strategies. Update your resume, optimize your LinkedIn profile, and explore new job boards and platforms. Take advantage of career counseling services and job fairs to increase your chances of finding a better-suited position. But hunting for a new job isn't a 40-hours-a-week deal. It just isn't. Use your extra time to prioritize self-care, spend quality time with loved ones, tackle things on your “someday” to-do list, and engage in activities that bring you joy. Use this period to create a healthier and more balanced lifestyle.
5. Opportunity to change careers entirely
Sometimes, being laid off can be a catalyst for a much-needed career change. (Uhm, hi! This is what happened to me!) If you were feeling unfulfilled or stuck in your previous job, use this opportunity to explore new industries or roles that align with your passions and interests. It isn't every day you're offered the opportunity to totally reinvent your work identity, so if a new career is something you've been thinking about — perhaps the universe is offering a sign.
6. Time to devote to entrepreneurial ventures
Being laid off can provide the freedom to pursue a passion project or start your own business. As someone who has been on this path three times now, you will never get another swath of uninterrupted free time to actually turn your hobbies or interests into a potential income stream than you have when you're in between jobs.
Perhaps you've already been dabbling in starting and running your own business, but you never had the time or energy to give it that final push to make it your full-time thing. Being laid off can provide the push you need to pursue your entrepreneurial dreams. Evaluate your skills, identify market gaps, and create a business plan. With determination and hard work, you may find success in being your own boss.
7. Increased job satisfaction
Being laid off can actually lead to a higher level of job satisfaction in the long run. Sometimes we stick with a job (or a career) because it's simple and easy. But a lay off often forces individuals to shake things up. By taking the time to reassess your career goals and values, you can find a new job that aligns better with your aspirations, your life plan, and your income goals. Look at this time as a gift and an opportunity, rather than an unfortunate circumstance (easier said than done when money is on the line, but it's worth repeating.)
8. Geographic flexibility
Being laid off can provide the freedom to explore job opportunities in different locations. If you've always wanted to live in a different city or country, use this time to research and apply for positions in those areas. Embrace the chance to experience new cultures and expand your horizons.
9. Increased resilience and adaptability
Experiencing a layoff can be a significant challenge, but it also builds resilience and adaptability. Overcoming this obstacle can strengthen your ability to handle future setbacks and navigate uncertain situations with confidence.
10. A fresh start
Lastly, being laid off can mark the beginning of a new chapter in your life. Embrace the possibilities that lie ahead and approach this transition with optimism. Remember that every ending is a new beginning, and great things can emerge from unexpected circumstances.
What to do after being laid off: six financial tasks
1. Take time to process and reflect
I know this feels like a weird piece of advice to headline an article about being laid off… but hear me out. You never make great money decisions when you are emotional. Being laid off can be one of the most emotionally challenging, stressful things that can happen to you (particularly if you are the breadwinner for a family.) But, it's important to give yourself some time to process the situation and reflect on your next steps. Take the day, the weekend, or even a week if you can swing it. Use this time to evaluate your career goals, strengths, and areas for improvement, and definitely use the time to evaluate your finances. (See next paragraph!)
2. Assess your financial situation
After a layoff, it's crucial to assess your financial situation and create a “bare bones” budget. If you have a well-rounded emergency fund with 6-9 months of expenses, you should calculate your expenses, prioritize essential payments, explore options for reducing costs, and then do a rough calculation of how long your nest egg will last. If you're without savings, it may be time to consider a quick side gig to earn enough money to pay your bills next month.
3. File for unemployment
The good news is that if you were truly laid off (instead of fired), you will likely receive *some* form of severance and qualify for unemployment through your state's Department of Labor. This is good news as it won't mean you're entirely without funds. Research unemployment options yourself, or rely on human resources through your former employer to explore what may be available to you.
4. Update your resume and online presence
TIME magazine reports that the average job search reached an all-time high in 2023 of 44 days. This is the time from resume upload to offer. I don't think this is a super long time (especially compared to the five-month statistic I've seen in other articles/other websites) but if you're used to being busy, it can be excruciating.
Use this opportunity to update your resume, highlighting your skills, accomplishments, and experiences. Tailor it to match the job market and the positions you're interested in. Additionally, update your online presence, such as your LinkedIn profile, to reflect your current skills and career aspirations.
5. Consider additional income streams
While side hustles may not completely cover your W2 income, they can greatly close the gap between income and living expenses, especially in the event of a layoff. Below are all my greatest resources on how to find, manage, and grow side hustle income.
- Making extra money on craiglist
- How to start a side hustle
- These side gigs will make your next $500, $1000, or $5000 dollars
- The best side hustles for busy people
- A step-by-step guide to decluttering your home for extra cash
Remember, being laid off can be a challenging experience, but it can also be an opportunity for growth and self-discovery. By following these tips, you can navigate this period effectively and position yourself for future success.
6. Evaluate your options for health insurance
Speaking from my own experience, figuring out health care was the scariest part of being laid off for me. Fortunately, I was able to COBRA my existing insurance. While it was certainly more money each month for me to have insurance, I was lucky to be able to have some kind of insurance as a stopgap.
You may have access to your spouse's insurance, or perhaps you want to get a marketplace plan. Either way, when you get laid off, don't just look at your severance, but what happens to your healthcare benefits, too.
Emotionally Preparing for a Layoff
A layoff can be devastating emotionally as well as financially. Perhaps even more devastation emotionally because it can happen “out of the blue.” Below are some of my best pieces of advice for dealing with the emotional fallout of unexpectedly losing your job.
1. Allow yourself time and space to grieve
Losing a job can be a significant loss, (especially if it is abrupt), and it's important to give yourself permission to grieve. Acknowledge your feelings of sadness, anger, or frustration, and allow yourself time to process them. I had been on a therapy journey during my divorce and had finally (finally!) gotten to a place in 2023 where I felt I no longer needed bi-weekly sessions. Then I got laid off and decided to scale back up again because it was scary and hard. When it took longer to find a job than I thought, my self-esteem took a hit.
2. Seek support
Reach out to friends, family, or a support group to share your feelings and experiences. Talking to others who have gone through a similar situation can provide comfort and reassurance. And I talked about this above, but you can consider professional help, too. Whether it's a therapist, or a career or professional development coach, if you find that your mental health is significantly impacted by the job loss, don't hesitate to seek professional help. A therapist or counselor can provide guidance and support as you navigate this challenging time.
3. Practice self-care
And now that you have tons of free time, there really shouldn't be any excuses as to why you can't go to the gym. Or to spend an hour in the quiet reading a book or nourishing your soul. Whatever it looks like to you –take care of your physical and emotional well-being by engaging in activities that bring you joy. This could include exercise, meditation, hobbies, or spending time in nature. I picked up gardening as my new hobby during my “funemployment” of 2023 and I found it to be a great form of exercise as well as a good outlet for my mental health.
4. Stay positive and maintain a routine
It's natural to feel discouraged during a job loss, but try to maintain a positive mindset. Surround yourself with positive influences, practice gratitude, and establish a daily routine to provide structure and stability. Maintaining a routine was something I really struggled with already as I worked from home full-time. After the layoff, it was like a free-for-all. A lot of time was spent on the couch watching television or aimlessly wandering my neighborhood while walking the dog. I'm not saying you shouldn't take time for yourself, but there is something as too much of a good thing.
And while we're talking about structure, set realistic goals, too. Create a plan for your job search and set achievable goals. Breaking down the process into smaller steps can help you stay focused and motivated.
5. Upskill and invest in professional development
Consider using your time after being laid off to enhance your skills and knowledge. Particularly in 2023, with more people hunting for work than in years past, it's important to give yourself a competitive edge. Take online courses, attend workshops, or pursue certifications that align with your career goals. This investment in yourself can make you more marketable to potential employers and increase your chances of finding a new job.
Remember, everyone's experience with job loss is unique, and it's important to find strategies that work best for you. Taking care of your mental health is crucial during this period of transition.
While being laid off can be a challenging experience, it's important to recognize the potential benefits it can bring to your finances and career. By embracing the opportunities for personal and professional growth, networking, skill development, and exploring new paths, you can turn this setback into a stepping stone toward a brighter future. While my unemployment ended in a complete sector change (From marketing to real estate), I know how hard it can be to remain positive after months of being laid off.
My best advice is to keep resilient and open-minded, and you may find that being laid off was a blessing in disguise.
Lauren Bowling is the creator of Financial Best Life. Writing about money since 2012 (formerly as L Bee and the Money Tree), Bowling is an award-winning blogger and money and real estate expert whose advice has been featured on CNBC, Forbes, CNNMoney, Elite Daily, Business Insider, Redbook, and Woman’s Day Magazine and more. After selling the site to a division of The Motley Fool in 2019, Bowling is now back as the owner and primary voice behind FBL and is excited to continue educating elder millennials everywhere about how to afford their best life.