Why Being Laid Off Could Be an Unexpected Financial Opportunity
It's normal to feel anxious about your finances after losing your job due to a layoff. But your finances can benefit from this life change. Find out how.
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No one wants to get the news that they no longer have a job. Unfortunately, a layoff can happen -- especially when you least expect it. Finding out that you're no longer employed can be stressful. You may worry about how you'll pay your bills despite no longer having a steady income. This fear is understandable, but you should know that a layoff could benefit your finances. Here's why being laid off could be an unexpected win for your wallet.
You can prioritize better-paying work
Many workers stay in their current jobs even if they're dissatisfied because it's easier to stay with their current employer than to put themselves out there and seek better opportunities.
A layoff could be a significant win if you've felt underpaid and undervalued for some time. When looking for new work, you can prioritize jobs that offer better pay and benefits.
Research before applying for jobs if you need clarification on a competitive wage for your desired role. You can use online salary database tools or talk with colleagues in your industry.
If you want to earn more money, be picky as you compare job listings. You may feel resentment if you settle for a new opportunity that pays similarly or less than your previous role.
It may take time to land a new role, but when you land a job with a salary matching your experience and skills, you'll feel more valued. And if you're working hard to reach your personal finance goals, the income boost can help you get there.
You can spend time building your own business
Here's another way a layoff could benefit you financially -- you could switch gears and make money from a business of your own. As an employee, your work benefits the company, not you individually. Beyond building skills (and of course a regular paycheck), your work itself won't benefit you long term. But if you're a freelance or small business owner, the work you do every day directly impacts you.
Being laid off could be the perfect push to make your goal of starting a small business a reality. Starting a business is hard work, and it takes time to build a successful company. But if you no longer have a job to go to each day, you'll have more time to commit to this goal.
This will be easier to do if you have a solid emergency fund. Make sure you can afford to pay your bills without going into credit card debt. If you have minimal funds in your savings account, another option is to get a part-time job while you spend time growing your business.
Many people who transition into freelance work or start a business earn a better income and feel fulfilled. One thing to consider is how your finances will change as a business owner. If you want to start a business, check out our small business resources for more financial tips.
A layoff isn't all bad news
Yes, a layoff is life-changing, and you may initially feel disappointed and stressed. All of the emotions you're experiencing are valid. But it can be beneficial to frame your thinking differently instead of focusing only on the negatives. Earning more money by taking a better-paying job or creating a business you love could be a major win for your bank account.
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