Just lost your job? Here’s what to do.

File for unemployment as soon as you can

Unemployment insurance is run by each state, so the rules, amounts and how long benefits last depend on where you worked. You generally file with the state where you worked, online, by phone or in person. The U.S. Department of Labor says to contact your state’s program as soon as possible after you become unemployed, and that it generally takes two to three weeks after filing to get your first payment.

• You usually qualify if you lost your job through no fault of your own and meet your state’s work and wage requirements.
• How much you get and for how long varies by state. Many states pay up to 26 weeks, and some pay fewer. Check your state’s rules with the CareerOneStop finder below.
• Have your past employers’ names, addresses and dates of work ready. The DOL says incomplete information can delay a claim.
• Find your state’s filing site with the CareerOneStop Unemployment Benefits Finder (sponsored by the U.S. Department of Labor).

Source: DOL: How do I file for unemployment insurance?

Find out how long you can last

Add up your cash and any severance, then compare it with what you spend each month. This quick estimate runs only in your browser.

Read your severance agreement and check your final paycheck

Federal law doesn’t require employers to hand over your final paycheck immediately, but some states do. If your regular payday for your last pay period has passed and you haven’t been paid, the DOL suggests contacting its Wage and Hour Division or your state labor department.

• Before you sign a severance agreement, note the deadline, payment timing, any release of claims, and non-compete or non-disparagement terms. Many people have an employment attorney review it.
• Ask HR about unused vacation pay (the rules vary by state and employer), your last day of health coverage, and whether the company will pay any of your COBRA premium.

Source: DOL: Last paycheck

Call lenders before you miss a payment

Many lenders and card issuers have hardship programs, but you usually have to ask. If you have federal student loans, ask your servicer about income-driven repayment or a temporary pause.

Choose between COBRA and a Marketplace plan, within 60 days

You have two main paths. You don’t have to take COBRA, and HealthCare.gov suggests comparing its cost with Marketplace plans before you decide.

• If you have a spouse or parent with a job-based plan, you may be able to join it. The DOL says you generally need to request this within 30 days of losing your coverage.

Sources: DOL: FAQs on COBRA for workers · DOL: COBRA · HealthCare.gov: COBRA when you’re unemployed

Triage your budget

Sort every bill into three piles: must-pay (housing, food, utilities, insurance, minimum debt payments), can pause (subscriptions, extra debt payments, savings transfers), and can cut. Every month you trim adds time to your runway.

Decide what to do with your 401(k), and avoid cashing out if you can

You don’t usually have to decide right away. Common options:

• Leave it in your old plan, if the plan allows (many do above a minimum balance).
• Roll it into an IRA or into your new employer’s plan. A direct rollover (plan to plan, or plan to IRA) has no taxes withheld.
• Cash it out. If the money is paid to you, the plan must withhold 20%, even if you plan to roll it over. You have 60 days to deposit it into an IRA or plan, and you’d need other money to replace the withheld 20%. Whatever you don’t roll over is generally taxable, and before age 59½ it may also face a 10% additional tax.
• There are exceptions to the 10% tax. One applies if you leave your employer at age 55 or older and take money from that employer’s plan. IRS Topic 558 has the exact timing rules, so check them or ask a tax professional before you rely on it.

Sources: IRS: Rollovers of retirement plan and IRA distributions · IRS Topic 558: Additional tax on early distributions

Plan for taxes on unemployment benefits

Unemployment benefits are generally taxable income. You can ask to have federal income tax withheld (Form W-4V), or you may need to make estimated payments. You’ll get a Form 1099-G showing what you were paid.

Source: IRS Topic 418: Unemployment compensation

Rebuild your cushion, then check for blind spots

Once you’re working again, refill your emergency fund before you go back to extras. Then take two minutes to check the rest: beneficiaries, insurance, and your retirement savings.