Surviving a Tech Layoff
5 ways to survive and stay afloat if you just lost your job.
The reality of being laid off can be scary because the emotional and financial impact is devastating.
Amidst the staggering number of layoffs in the tech sector in recent months, how to navigate through such a challenging situation is much needed.
The layoffs driven by the tech giants like Amazon, Spotify, Twitter, Google, Yahoo, Microsoft, and Paypal are a loud reminder that jobs are breakable contracts, not sacrosanct vows.
Well, the deed has been done, now what next?
In his book: Man’s search for meaning, Viktor Frankl said;
“You can’t control what happens to you, but you do have control over how you choose to respond to it.”
And that’s powerful because it means you have the power to thrive no matter what’s happening to you or around you.
In this blog post, you’ll discover a 5 step guide to surviving a layoff.
1. Take Care Of your Mental health
First, you have to realize that the layoff isn’t about you.
These companies over-hired and over-spent during the pandemic, and now revenue can’t keep up with the pace of the spending, unfortunately, you had to bear the brunt of their short-sighted decisions.
I know, It’s really hard to understand when you see your coworkers that still have their jobs and you don’t. Makes you wonder if it is your fault you lost your job.
Note this down, save it, create a post-it note, and put it on your bathroom mirror or wherever: “This wasn’t about me, this is not a reflection of my impact or my performance”. Because it really isn’t about you, you must come to terms with that.
Another important way to protect your mental health is by surrounding yourself with supportive people and reaching out for help when you need it.
Don’t isolate yourself, it could be tempting to do so maybe out of embarrassment, but that could exacerbate your situation.
Seeking support is a sign of strength, not weakness.
You can open doors to opportunities just by talking to someone, and most times belonging to a community can help you see opportunities you didn’t realize were right in front of you.
2…Think of what you want to do next
While it might take you a while to fully recover from the layoff in terms of confidence, you still have financial obligations. Therefore, you must snap out of it fast and put on your thinking cap.
You have to take time to carefully consider your next steps.
Are you going back to the job market, or are you ready to make the jump from W2 Income to Passive Income?
Do you want to pursue further education to upskill, or will you start a business like Louisa?
Louisa was laid off from her tech job in the spring. Just one month earlier, she had a positive review from her boss and was promised a raise with more stock options.
The layoff thus came as a surprise. And unlike some of her colleagues, who put their names in spreadsheets and jumped back into the job hunt, Louisa took a few weeks to think. “I wasn’t sure I wanted to stay in tech. I wasn’t sure I wanted to work for anyone,” she said.
“I had to make a decision in terms of what I want my day-to-day life to look like financially. Am I going to hustle or do I just want to take what falls into my lap?” she said. “After a couple of weeks, I felt like I’m ready to take more control back as opposed to just letting people kind of sway me one way or another.”
Currently, Aaliyah works two full-time tech jobs — neither company knows — and she runs a consultancy business on the side.
The bottom line is – the decision about how to proceed after being laid off is a personal one that depends on a variety of factors such as; your personal interest, financial stability, and career goals.
Regardless of the part you choose, it’s important to approach it with a sense of determination and optimism as those two are the keys to success.
3… Retirement Savings
This may seem unimportant right now and that’s understandable. Your distant financial future might appear trivial when you have pressing needs, but the decisions you take today will decide if you’ll have a secure financial future or struggle to make ends meet later on.
If you have a 401(k) account you might be wondering what to do with your retirement investments and the best place to roll over your old 401(k) funds.
If this is the case for you, the eQRP 401(k) account could be the best option for you.
The eQRP 401(k) gives you total control over your financial future, and also it gives you access to a wide range of investment options that could speed up your financial freedom.
It’s a straightforward plan that keeps your savings from getting eaten up by taxes and other costly tax traps.
The funds in your retirement account provide you with the opportunity of borrowing from it, with lending rates as crazy as they are. You have the chance to borrow at an affordable rate and pay your retirement plan back at a more preferred payment option.
The eQRP 401(k) provides you with this option, void of penalties.
Making the right decision on where to roll over your account can potentially save you thousands of dollars, or cost as much if you make the wrong decision.
Depending on how much funds you have in your retirement account, you may have a limited time to make this decision, and in some cases, your former company can decide for you:
- If you have less than $1,000, your ex-employer can just cash you out. You can still roll over the money into another account, but you typically must do so within 60 days.
- If you have between $1,000 and $5,000, your ex-employer can move the money into an IRA of its choice. If you don’t like that IRA, you can always move it to a better option.
- If you have more than $5,000 in your 401(k), your company must await your instructions on how to proceed.
Note: these options will change in 2024, due to the recently enacted SECURE Act 2.0.
Taking steps to ensure your financial stability and security has a great impact on your future, therefore don’t underestimate the power of starting early because it has a profound effect on your long-term financial well-being.
4… Check your Finances: Take stock
Things tend to get a lot scarier when they are uncertain.
This is not the time to make hasty financial decisions. That is why you have to take time and carefully consider what you’re to do next.
It’s easy to make terrible financial decisions after losing your job, however, try not to panic and take impulsive decisions.
It’s crucial at this point to stay calm and think logically about your financial situation.
Talk to a financial expert, or a wealth manager before taking any major decisions. There are so many resources available to help you manage your finances.
Also, it’s advisable to cut down on your expenses. Take a closer look at what you’re spending money on, what unnecessary expenses do you need to eliminate?
These cuts might look little and insignificant to you but they add up quickly.
Avoid emotional spending, it causes you to spend more than your budget can sustain.
You may want to consider a side hustle to boost your income or move to a low-cost area to save money.
It’s okay to feel overwhelmed by all of these, especially if it’s your first layoff. However, taking small steps can help you build a strong financial footing that can reduce or ease the financial stress of losing your job over time.
Always remember to be kind to yourself as you walk the ladder to financial stability.
5. Keep looking out for opportunities.
You don’t know what is around the corner that you wouldn’t have seen if your circumstances hadn’t suddenly changed.
A layoff could be a redirection to something better.
Explore what opportunities exist for you, and how to use them to your advantage.
Even in a difficult situation, there are opportunities all around us if we’re willing to look for them.
Don’t be embarrassed to ask for unemployment benefits and a severance package if your company offers one.
Worthy to note: Accepting a severance package may make you ineligible to file a wrongful termination suit or collect unemployment insurance. As well, the severance agreement may include a noncompete clause, which could interfere with your ability to find a new job in the same industry or market.
So it’s advisable to thoroughly read the severance agreement and consult a lawyer if necessary.
If you have RSUs – (Restricted Stock Units) – a popular type of compensation for those employed in the Tech industry, you can consider selling a portion for tax loss harvest purposes.
Join a community that can help you grow your knowledge and improve your investment skills. This network can be a valuable resource if you’re looking for new job opportunities or business partnerships.
Consider diversifying your investment portfolio to further foolproof your finances and avoid unnecessary risks.
It’s crucial to find solid investing platforms that are not only reliable, but also quick to respond to your questions…
Where you have access to experts who can guide you through the investment process, so you can make an informed decision.
There are a lot of doors you would never consider opening because you were constrained by what you used to have, now might just be a good time to turn those keys.
If there’s one thing we’ve learned from the layoffs – it’s that things can change very fast.
Want to talk about the best option for your old 401(k), how to access investment options, and be a part of a supportive community?
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