“I lost my job. Now what?” You’re not alone. We know that beyond the emotional shock, a job loss can create concerns about finances in both the short and long term. But there are all sorts of resources to help.

“It’s natural to be worried about an unexpected job loss, or confused about what to do next,” says Heather Winston, financial professional and product director for Retirement and Income Solutions at Principal^®. “Dealing with job loss can be stressful, but you can still make financial decisions to set you up for the next stage.”

This list can help you work through it.

1. Apply for unemployment benefits, if needed.

Each state runs its own unemployment benefits program and may offer options to file online, by phone, or in person. Learn more about eligibility and how to apply at usa.gov.

2. Review your final paycheck.

There may be some good news: Your final paycheck may include compensation for earned time off, back pay, commissions, severance, or a bonus. Those extra funds may help tide over your budget, especially if you’re able to trim expenses, too.

3. Get the most from your employee benefits.

Maximize the benefits you were receiving and make them work for your new situation, if you can.

• Health, dental, and vision insurance: If you have a termination date, see if you can schedule appointments and fill prescriptions before you leave.
• Life insurance: If you bought or were provided life insurance coverage through your former employer and want to keep it, you may be able to convert it into an unaffiliated policy that works for you.

4. Make a decision about health insurance.

The most common options include:

• A spouse/partner plan: If you have a partner who has insurance through work, you may be able to join their plan. You’ll likely need to sign up within 30 days of your last day.
• COBRA continuation coverage: This allows you and your family to continue health insurance for up to 18 months. If you had dental and/or vision insurance in your old job, that’s included, too. COBRA can be pricey; you'll pay the full premium without an employer covering some of the costs.
• Health Insurance Marketplace plans: Created by the Affordable Care Act, this exchange offers options based on your household income, so it may cost less than COBRA. Availability varies from state to state.

Visit healthcare.gov to learn more about these options.

5. Decide what to do with your retirement plan, such as a 401(k) or 403(b).

Your former employer will provide you with a decision deadline. Options include:

• Keep your money where it is, if allowed. If you want to keep your savings invested with the same tax advantages, this may be easiest. However, you cannot make any more contributions to the account after your employment ends. Also, many retirement plans don’t let you stay in the plan if your account balance is under a certain amount ($7,000 in 2024).
• Put your savings into an individual retirement account (IRA). Old retirement accounts can be moved to a new central account, called a rollover IRA, which you can then continue adding to up to IRS limits. You own this account, not your employer, and you’ll enjoy a range of investment options and tax benefits. Learn how rollover IRAs work.
• Move your money to your next employer’s plan. This is typically an option if you find another job within your retirement plan’s decision window and your new company offers a retirement plan that allows it.
• Cash out your account balance. Do you need money now? There are downsides—the taxes and penalties tend to be steep, and you could bump into a higher tax bracket, not to mention miss out on future growth—but we get the appeal. Consider your options for emergency cash before committing to this option.

6. Review health savings account (HSA) funds and your flexible spending account (FSA) balance.

You can generally keep your HSA balance where it is and continue to use it for future eligible health care expenses. Or, if you get a new job, you may be able to transfer the funds.

FSA balances, however, typically expire based on employer rules and deadlines. What you don’t use, you lose, so ask your HR contact how much time you have to spend this money on eligible items or to submit claims for dependent care or health care expenses.

If you’re eligible for COBRA coverage, it may enable you to continue your FSA.

7. Learn more about any stock options and other non-salary perks.

If you’ve been getting non-salary compensation, check the vesting period and what percentage of compensation is available. Many companies require you to use your stock options within a certain amount of time, often 90 days from your termination date.

Follow up on other non-salary perks, too. If you're taking classes, for example, check your former employer’s tuition reimbursement program for specific rules about how the company handles reimbursement.