Personal Finance Help - What to Do When You're Out of Work

Millions of Americans find themselves jobless each year. We hope that you aren't one of those, but if that's your situation, here are some tips to help deal with what can be a tough situation and hopefully end up in a better situation than before!

First, stay calm. Sit down with your family, and tell them you'll have to do some belt-tightening. Tell them how important their emotional support is to you, and ask for their help.

As soon as you can, develop a "success plan" (which we think sounds so much better than "budget"). You'll just have to spend less if you have less income, so think of ways to cut corners. You will, however, have to factor in some job-hunting expenses: transportation to interviews; possibly printing and mailing your resume; Internet access, etc. You will be able to take tax deductions for any expenses that involve looking for a job in the field in which you've been working, so keep the receipts in a file for that purpose.

Also as soon as you can, start calling people on your "networking" list. (See Dealing with Job Loss: Our 7-Step Action Plan.) Try to budget for some lunches and conferences that might net you job leads. This is money invested; put your efforts into selling yourself and making the expenditure pay off.

Check Your State's Unemployment Benefits

I (Daria here) know just what kind of nasty games an employer can play to avoid paying unemployment insurance. How do I know? Because it happened to me.

When I was pregnant with Meredith, I was working for a driving school as an office manager and receptionist. My employers knew I was planning to quit before the birth. Well, one month before my due date, I gave my two weeks' notice. I was fired on the spot!

The next day I went to the unemployment office and filed my claim. But the week after Meredith was born, my ex-employer called to offer me my job back. I, of course, turned it down, and BINGO -- they were off the hook for unemployment insurance and I lost my checks!

Dolan Smart Money Move: As you can see, do not let yourself be coerced into resigning from your job if things are tough at your company. Hang in if you must, and swallow your pride. If you resign, you will not be able to collect unemployment benefits.
If your employer puts the screws to you by orchestrating a "resignation" instead of laying you off, you might have to sue to get the compensation to which you are rightfully entitled.

If you've been let go from your job, one of the first things you should do is make sure you will be entitled to unemployment and find out how long the benefits will last. In most states anyone who has been laid off after a minimum of six months with the company is entitled to collect benefits for 26 weeks. There is no shame in collecting what is due you. In many states you can file your weekly claims by telephone or over the Internet rather than having to stand in line at the unemployment office. And if you do have to go to the office, you will probably be amazed at the number of professional-looking people there.