This is the second part of my series on “How I Got My Job”, the story of how I went from unemployed to working for my dream company. Read part 1 here.
Not everyone receives severance when they’re laid off, and it runs out quickly for those who do. Expenses will still pile up when you’re unemployed, and the money has to come from somewhere. You also need to make up for lost benefits like health insurance.
When I was downsized I reduced my regular expenses but found that I still needed $2,000 per month to get by. Here’s a list of the 5 resources that supported me when I was jobless:
1. NY State Unemployment: The day I was officially unemployed, I filed for unemployment insurance. The amount you get depends on what your income has been over the past year or so, but the absolute maximum is $430 per week. About $30 per check can be withheld for federal taxes; I kept back a little more than that for other taxes. Ultimately I was left with about $1300 per month, the bulk of my income.
2. Savings: Using UI as my main source of income still left me $700 in the hole each month. I had to make up the difference somehow. So I put all of my severance (minus one-third saved for taxes) into my emergency fund, and I drew the $700 from there each month.
3. Health insurance: No job means no health insurance, and I knew I needed coverage in case of emergencies. I used Healthy NY, a State- subsidized plan that offers insurance through all the normal providers—Empire Blue Cross, GHI, Oxford, HIP, etc. I chose the high-deductible plan, which means I had to pay for any expenses up to $1,150 (except for routine physicals and preventive care like that). This plan cost me about $200 per month, which is damn reasonable and usually cheaper than COBRA.
4. Temp work: A couple of months into unemployment, I found a temp job in my former coworker’s wife’s office. Rather than negotiating the hourly wage, I asked for a 4-day-a-week schedule. This allowed me to stop spending down my savings, but still keep Fridays free for continued job hunting. Once I started, I had lots of down time—I was mostly doing receptionist duty and making some appointments—so I used my spare time to dive into career research. But that’s for the next post in this series!
5. Freelance/consulting work: Try to turn anything you did at your last job into freelance work. I actually was brought in as a consultant a few times by my old employer, which was great money. I also reached out to some of my friends and relatives and did some translation work for them, another source of income. And just between you and me, if you do less than $600 of work for a company, they probably won’t report it to the IRS, so it’ll be tax-free.