More financial tips if you have been or think you will be laid off…
Consider health insurance options
Being out of work means being cut off from certain benefits, such as health insurance. If you think a layoff is imminent, you should consider getting a health checkup and scheduling appointments with doctors and dentists while you still have those benefits.
If your spouse is employed, it’s important to review their health insurance benefits that could extend to you.
If that’s not an option, consider the Continuation of Health Coverage (COBRA) that gives workers and their families the right to continue using the insurance benefits for a period of time in certain cases that include job loss. The cost needs to be considered when budgeting. Individuals may be required to pay the entire premium for coverage up to 102% of the cost to the plan.
NOTE – we often find that COBRA is more expensive than a private policy with Covered California™ | The Official Site of California’s Health Insurance Marketplace. Although your work policy may be very robust, you may be able to scale down your ‘platinum’ plan to a more cost-effective bronze or silver plan – until you secure a new job (depending on your health needs).
If your company also offers other types of benefits, such as life insurance, check to see if those coverages have portability or how to make them permanent policies once you leave that employer. AND to really evaluate if you truly need those benefits and want to private pay for them.
Analyze stock compensation
Clients with stock-based compensation require an extra layer of work when preparing for a potential layoff. It’s important to check the vesting schedule to know what they’re eligible for and if that means exercising their options before expiration.
Each company has a different post-termination exercise period for employees after they’re laid off. That time period usually is 95 days or less after the layoff. But companies may be more generous and provide longer periods given the situation and since the pandemic.
If there is a severance package, you may be able to secure the value is that’s being left ‘on the table’. It’s possible to receive it as a cash bonus or payout to make up for the value that they potentially are losing.
This one is complex! A Certified Financial Planner® like our Planners at Asti Financial Management can help you analyze your options and develop the best strategy for your unique situation.