Financial Checklist and Tips When Losing a Job

Financial Checklist and Tips when Losing a Job

Losing a job can be very stressful on your personal life and your family, but there are ways to reduce the stress on your finances. We have compiled a checklist and some tips you can use to lessen the impact of temporary unemployment and protect the financial security of your family.

Items to consider before you leave your old job:


Meet with your benefits counselor or review your current benefits to make sure you understand the following:

  • Which employer benefits should be replaced, such as health, disability, or life insurance.
  • Which employer benefits can be kept or transferred, such as a workplace savings plan.
  • When employer benefits such as health, disability, or life insurance will cease and how COBRA insurance can help.
  • What compensation, if any, you are entitled to, including back pay, vacation days, sick pay, or future distributions.


  • Apply for unemployment insurance as soon as possible after losing a job. Procrastination may reduce your benefits. The majority of employers offer COBRA to extend health insurance benefits, but there may be less expensive options.
  • If your spouse has a health plan, compare it to continuing your health insurance under COBRA or enrolling through the Health Insurance Marketplaces. In some cases, it can be less expensive with equivalent or better benefits. A job loss is typically a qualifying event and most plans will allow for making benefit changes.

To qualify for special enrollment in a Marketplace plan, you must select a plan within 60 days before or 60 days after losing your job-based coverage. Eligibility for COBRA continuation coverage won’t limit your eligibility for Marketplace coverage. You can apply for Marketplace coverage at or by calling 1-800-318-2596

Evaluate your family’s financial situation

Items to consider before making financial decisions:

  • Severance Packages
  • Potential Length of Unemployment
  • Impact of reduced income on Monthly Budget
  • Health Insurance Costs Increases on Budget
  • Retirement Plan and Company Stock Access

Look closely at your income versus expenses, and make a realistic assessment of your financial security.

Financial Planning Decisions to Discuss with Financial Advisor:

  • Determine how long your emergency fund will last
  • Cash Flow Modeling to determine if investment allocations should be change
  • What to do with your old retirement savings plan 401k, Pension, Corporate Stock Plans, 401k and other Retirement Plan Options

You have three options for your old 401(k) that can provide continued potential tax-deferred growth opportunities:

  1. Roll over to a Personal IRA – This allows you to consolidate your retirement accounts in one place, while continuing tax-deferred growth potential. This gives you the most investment options and financial planning flexibility.
  2. Roll over to a new workplace plan (if permitted) –You may be able to consolidate your 401(k)s into one account, while continuing tax-deferred growth potential. This could limit some financial planning opportunities.
  3. Stay in your old workplace plan (if permitted) – Lets you continue tax-deferred growth potential, but you can no longer contribute to the old plan. This could limit some financial planning opportunities.

If you must, you can cash out your plan. However, keep in mind that taxes and often penalties will apply. There may also be additional withdrawal penalties. Consider the lost compound interest as well as the lost asset, and how that will affect your overall retirement planning.

For many investors, rolling over old workplace savings accounts to an IRA may offer the most compelling benefits for managing retirement savings. It’s also important to review investments at least once a year and rebalance as necessary.

There are many decisions to make after losing a job, especially when it is an abrupt change.
Keep your personal financial goals, such as saving for retirement, top of mind. An objective financial advisor is a valuable resource to offer suggestions to keep your financial plan on track. Please call us at 317-407-7678 or contact us for a free consultation to see if we can help you.

Please be sure to speak to your advisor to carefully consider the differences between you company retirement account and investment in an IRA. These factors include, but are not limited to changes to availability of funds, withdrawals, fund expenses, fees, and IRA required minimum distributions.