Managing a job transition or severance package

A job transition — especially one involving a severance package — can feel stressful and uncertain. But with the right steps, you can help protect your finances and move forward with more clarity.

1. Understand your severance package

Severance packages can include cash payouts, salary continuation, prorated bonuses, stock vesting, COBRA subsidies, and career transition services. Carefully review your agreement and understand any deadlines, revocation periods, or requirements.

2. Protect your health insurance

Employer-sponsored insurance typically ends at the close of the month. COBRA may provide temporary continuation (sometimes subsidized), or you may consider marketplace plans or joining a spouse’s plan. Maintaining coverage can help protect you from unexpected medical costs.

3. Manage your retirement accounts

Evaluate whether to leave your 401(k) where it is, move it to a new employer plan, or roll it into an IRA. Each option has pros, cons, and tax considerations — especially if you have an outstanding loan.

4. Build a financial safety plan

A job search may take 6–12 months. List your income sources (severance, unemployment, savings) and create a budget that helps you stay secure throughout your transition. Reducing nonessential expenses early can help extend your financial runway.

5. Manage debt and cash flow wisely

Avoid accumulating new debt. Reach out to lenders if you need temporary flexibility. Build or preserve a cash reserve to help stay stable during uncertainty.

6. Use career transition services

If your package includes outplacement services, use them. Coaching, resume support, and job-search guidance can help you return to the workforce more quickly.

7. Understand unemployment eligibility

Each state determines eligibility and timing. Apply as soon as your separation is official to avoid delays.

A job transition can be challenging, but it’s also a moment to reset, reassess, and plan intentionally. If you need help reviewing your severance, organizing your finances, or planning your next step, I’m here to help you.