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Financial Things to Do When Leaving a Job

If the time has come for you to say goodbye to the job you have been doing for a good long while, and you are worried about the financial implications of doing so, especially if you do not yet have something lined up, here are some tips that will help you handle the money side of your decision more effectively.

Financial Things to Do When Leaving a Job

1. Hoard Your Paystubs Like a Dragon

The first thing you are going to want to do when the decision has been made for you to quit your job is to gather up all of your most recent paystubs. You need to do this because they will be the proof you need that you've been earning money and paying taxes. You'll need them for everything from applying for unemployment benefits to proving your income for a new apartment, so they are very much an important part of quitting. Plus, it's always fun to look back and see all the money you made (and wonder where it all went).

2. Tango with Your 401(k)

Your 401(k) is your little nest egg of retirement savings, so hopefully you have been paying into one for a while now, and before you make a break for it, you are going to want to take the time to decide what to do with this bad boy. You can leave it be, roll it over into an IRA, or transfer it to your new employer's plan. Just don't cash it out unless you want a hefty tax bill and penalties. It's like taking candy from your future self, and future you is not going to be happy about it.

3. Health Insurance: Don't Go Naked

Losing your job means saying goodbye to your employer-sponsored health insurance, too. Before you freak out and start Googling every symptom you've ever had, check out COBRA (it's not as scary as it sounds). It lets you keep your coverage for a while, but brace yourself for sticker shock – you've got to pay the full premium. Alternatively, dive into the Health Insurance Marketplace. Sometimes, you can find a deal that won't make your wallet cry.

4. Unemployment: Your New BFF


If your job exit wasn't exactly by choice, unemployment benefits might be your new best friend. Applying is about as much fun as watching paint dry, but it's worth it for the financial cushion. Just make sure you're eligible and get your paperwork in order. And remember, this BFF is temporary, so don't get too comfy.

5. Call in the Settlement Solicitors

Settlement solicitors - do you need them? If your departure involves a bit of... let's say, "disagreement" over things like unpaid wages or severance, these are the folks you want in your corner. They're like financial knights in shining armor, battling it out to make sure you get what you're owed. Plus, watching them go toe-to-toe with your former employer is better than any reality TV drama.

6. Debt Detox

Leaving a job might mean a temporary dip in your income, so it's the perfect time for a debt detox. Look at your loans, credit cards, and that pesky mortgage. Figure out a plan to keep on top of payments without your regular paycheck. It might mean tightening the belt for a bit, but your credit score will thank you.

7. Emergency Fund: Your Financial Parachute

If you don't have an emergency fund, now's the time to start panicking. Just kidding. But seriously, having a stash of cash to cover 3-6 months of living expenses is like having a financial parachute. It's there to save you if you hit turbulence on your way to your next job. If you don't have one, start squirreling away money like it's going out of style.

8. The Side Hustle Shuffle

At this time, you may want to seriously consider embracing the side hustle. Whether it's freelance writing, selling your crafts, or becoming a mystery shopper, a little extra income can help fill the gaps. Plus, you get to add "Entrepreneur" to your resume, which is always a nice touch.

9. Audit Your Subscriptions

Let’s face it, we all have subscriptions we swear we need – from streaming services to that app that reminds you to drink water (because apparently, we’re plants). Now’s the time to go on a subscription safari and hunt down those you can live without. You might discover you’re subscribed to six different music streaming services. Pick your favorite and say goodbye to the rest. Your bank account will perform a happy dance.

10. Negotiate Your Bills

Channel your inner negotiator and call up your service providers. Internet, cell phone, and even your utilities companies can sometimes offer better rates if you threaten to switch or just ask nicely. It's like haggling at a market, but over the phone and with less shouting. Every dollar you shave off your bills is a dollar you can redirect towards your emergency fund or your debt detox plan.

11. Harness the Power of Freebies

The world is full of freebies, you just need to know where to look. From free online courses to enhance your skills and marketability, to community events that don’t cost a dime, these opportunities can provide both entertainment and education without cracking open your wallet. Remember, fun doesn’t always have a price tag attached.

12. Master the Art of Meal Prepping

Eating out can drain your finances faster than a leaky faucet. Embrace the art of meal prepping. Not only will this save you a ton of money, but you might also discover a hidden talent for cooking. YouTube is your friend here, offering endless tutorials on how to make gourmet meals on a budget. Plus, nothing says “I have my life together” like a fridge full of neatly organized meal prep containers.

13. Revisit Your Goals and Budget

Finally, use this time as an opportunity to really dial in your financial goals and adjust your budget accordingly. Dream big – whether it's traveling, buying a house, or going back to school. Then, break down these dreams into actionable financial steps. This reflective process not only gives you a clearer direction but can also be surprisingly motivating.

Leaving a job is a major life change, and it can feel like you're stepping into financial quicksand. But with a little planning, you can get through it like a pro!

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