What To Do When You Lose Your Job: 18 Steps You Can Take

By Indeed Editorial Team

Updated August 16, 2022 | Published January 13, 2021

Updated August 16, 2022

Published January 13, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

A person sitting at a table types on a laptop with a smartphone to the left of the laptop.

When you lose your job unexpectedly, it can be a challenge knowing what to do next. Taking a step-by-step process as you navigate this transition can help make the situation feel less overwhelming. In the aftermath of losing a job, you must manage the adjustments that come with it, then focus on your future and finding new opportunities.

In this article, we provide 18 steps that you can take after you lose your job.

18 steps to take after you lose a job

No matter what your situation, losing your job can be a difficult process. You can use the following 18 steps to help navigate this transition:

1. Process your feelings

You will likely go through a variety of emotions after receiving the news from your employer. Initially, you may feel sad or angry about your circumstances. In some situations, you may even feel a sense of relief that you now have the opportunity to find a new role or career path. Allow yourself to feel these emotions, and ask for help when you need it.

Right after you lose your job is also a great time to reflect—try to understand why you feel this way. When you do this, it can spur you onto your next steps. For example, when you realize that your current unknowns make you feel nervous, it demonstrates that you must start making plans to calm those fears.

2. Tell people

Your first must tell your family or anyone else you support. Be honest about the situation, then discuss your next steps and any changes you need to make during this adjustment period. You also can mention this news to your friends to make them aware of your situation. They may be able to give you advice, help you look for opportunities or provide support in other meaningful ways.

3. Apply for unemployment

If you lost your job through no fault of your own, such as layoffs, you should be eligible for unemployment benefits. Go to your state's Department of Labor website and apply as early as possible so that you can start collecting benefits sooner. Also, make sure to learn how much you will receive each week in employment benefits and whether there are time limits on receiving them

4. Review your health insurance options

Check with your company's human resources department about your health insurance options. They may enable you to continue your existing employer-provided coverage for a set period through the federal Consolidated Omnibus Budget Reconciliation Act (COBRA). However, you likely must pay the full monthly premium because your former employer no longer subsidizes the cost.

If possible, find out if you can receive coverage through a spouse's plan. Otherwise, you can research options for non-employer-provided health care plans or ask your friends for suggestions. A job loss is typically a qualifying event for purchasing insurance coverage outside of enrollment periods.

5. Decide what to do with your 401(k)

If you had a 401(k) retirement plan with your employer, find out what you can do with it as you leave the job. Your options can vary on the employer or plan. However, you often can choose from the following:

  • Leave the money invested with the employer: If the balance is at least $5,000, you can typically keep the account but may need to pay maintenance fees and follow certain restrictions.

  • Transfer the money into a 401(k) with a new employer: If you find a new job that offers a 401(k) plan, you can transfer the funds in your existing account into the new one without any taxes or penalties. Make sure to research what the transition process looks like to ensure you can do it smoothly.

  • Move the money into an IRA account: If your balance was below $5,000 and you do not have a new employer yet, you can potentially move the funds into an individual retirement account (IRA). In these tax-deferred accounts, you pay taxes when you withdraw the funds at retirement age.

  • Cash out the 401(k): If you cannot use the above options, your employer can send you the balance of your account in check form. However, cashing out a 401(k) leaves you subject to penalties and a 20% withholding tax.

Related: 4 Things You Can Do With 401(k) After Leaving Your Job

6. Develop a budget

Even if you receive severance pay or unemployment benefits, your income may not meet the same level as before. Look at your current budget and make adjustments as needed. You may start with smaller costs, such as cutting down your daily coffee runs or restaurant takeout.

You can also cut out anything that you know you can live without for now, such as a gym membership or subscription to a streaming service. You cannot eliminate certain expenses, so your focus should be on making sure you have enough money to cover those.

Related: How To Create a Budget in 7 Steps

7. Set a schedule for yourself

Once you organize the necessities, you must make finding a job your priority. To keep yourself in a routine, treat your days as if you were employed—set a morning alarm, take a shower, get dressed and choose a specific time to start working.

Your schedule can keep you on track and motivated. Unemployment also offers you more freedom, so set aside time for yourself and your interests. Participating in non-professional activities could help you meet new people and build your network. These hobbies or activities may even hold the potential for a new career or job opportunities.

8. Determine your desired career path

As you think about finding a new job, reflect on what type of career you want to have. If you were not fully satisfied in your old position, now you have the freedom to seek opportunities that better match your interests or abilities.

Think about what you most enjoy doing, then search for jobs that include those skills or responsibilities. Doing this gives you an idea of what could serve as good options and whether you may need to attain additional credentials to move into those roles.

If you determine that you want to switch to a new career path, you may need to be more flexible. With less experience than other candidates, you might need to work up to more advanced roles. You can also look for temporary or contract jobs, which allow you to test out careers to decide if they feel like a good match.

9. Evaluate your online presence

When potential employers search for you online or check your background, they might find your social media profiles. You want these public pages to serve as a positive reflection of yourself, so make sure the posted content or images are work-appropriate.

You can also utilize them to showcase your professional qualifications or brand. For creative professions, you can post images of your work or links to your blog posts. If you work in a more technical industry, you might post links to articles or thought leadership about your field. Doing this showcases that you stay up-to-date on your industry.

10. Update your resume

As you apply for new jobs, make sure to update your resume and tailor it to each role. Hiring managers want applicants that have relevant skills, experiences and qualifications. To do this, use keywords from the job descriptions throughout your resume to catch their attention and pass potential applicant tracking systems.

Related: Guide To Updating Your Resume

11. Identify your references

Potential employers may ask for references when you apply to positions, so have a list of contacts prepared. Depending on why you lost your job, you may still be in touch with your former employer.

Ask your now-former managers or coworkers if they would serve as references as you begin interviewing for jobs. You can also contact any other prior employers or industry colleagues who could speak positively about your qualifications.

Related: Types of References and How To Get Them

12. Reach out to your network

Use social media, email or text messages to contact your personal and professional networks and let them know you are looking for a new job. These connections can help find opportunities or provide referrals. Beyond providing assistance finding a job, you can ask these individuals for advice on the job search process or insights into an industry you want to pursue.

13. Focus your job search

While you may want to send out as many resumes as possible, it is better to take a more focused approach. Only apply to jobs that match your qualifications and skills. Sending out applications for positions you do not have much interest in or the relevant qualifications can lead to wasted time for both you and the hiring manager.

Furthermore, when you know you have the right skills or experiences, you feel more confident going into the interviewing process.

14. Use a variety of job search options

While online job boards and search platforms are a great way to find positions in your area or industry, do not solely rely on one method. If you are interested in a specific company, check their website and social media to see if they have openings or contact them directly.

You can also seek out staffing agencies, though keep in mind that some of those jobs may start on a temporary or contract basis. You can meet people by attending job fairs or professional networking events. Make sure to bring updated resumes and business cards that you can pass out to potential employers.

Try to attend industry- or field-specific networking events to help make connections that could lead to relevant opportunities. When attending these events, make sure to dress professionally and prepare to talk about yourself and your qualifications.

Related: Best Ways To Find a Job: Six Methods That Really Work

15. Take time for professional development

Use some of your extra time to develop skills that help you advance professionally. As you look through job positions, look out for the skills or qualifications that employers in your field are seeking.

Search online or in your area for resources and classes that will help you build and practice those skills. Then you can put them on your resume and discuss them in interviews to demonstrate your ongoing commitment to development.

16. Practice interviewing techniques

When preparing to interview with companies, start researching common interview questions for your field or position. You can draft and practice responses to help you feel more comfortable when speaking to hiring managers. Practice alone or in front of a friend who can give you feedback.

Also, evaluate how you speak and the nonverbal cues you use, as these can impact hiring managers' perceptions of you. When you appear assured and poised when discussing your relevant qualifications and accomplishments, it leaves a strong impression.

17. Prepare to address your job loss

Interviewers often ask why you left your most recent job, so have a professional answer ready. You want to focus on the future, not the past, so you should be concise and then transition into your hopes for new possibilities.

Avoid speaking poorly of your former employer to maintain a positive reputation as an employee. If you lost your job due to your performance, address it honestly and explain what you learned from the experience or how you have improved since then.

Related: How To Explain Your Reasons for Leaving a Job (With Examples)

18. Do not become discouraged

Losing a job and searching for a new one can be tough, particularly when you face rejection. However, remember not to take things personally—for whatever reason, the job did not work out, or the potential new opportunity was not the right fit.

There are still plenty of positions for you to find that will meet your needs. Maintain a positive attitude by focusing on the wins each day, whether they are job-related or not. When you feel happy, it helps keeps you excited about the future and motivated to continue your search.

Related: Practical Tips for Job Seekers with Indeed

In this video, you'll learn best practices for starting your job search, applying to the right roles and nailing the interview.

Explore more articles