Worried about being laid off from your job? Expert reveals what you should do to prepare!

Added: 2026-05-14

[00:00:00]State's biggest employers have cut [music] thousands of Puet Sound area jobs since the start of the year, including Seattlebased Amazon, Belleview based T-Mobile, and Seattlebased Starbucks.

[00:00:09]>> In fact, Starbucks just announced the elimination of 61 jobs at its corporate headquarters in Seattle this week. So, what should we all be doing to financially prepare for that heartbreaking reality facing so many workers right now? Joining us in studio live this morning is financial adviser Adam Powell. He's with the private advisory group. Thanks for being here this morning.

[00:00:26]>> Good morning. So if you're in that position or if you know you're thinking, "Oh gosh, I might be in that position in the future, what is something that we can all to do, you know, sort of do to prepare for that financially if it does happen down the road?"

[00:00:38]>> A first thought that comes to mind is preparing your financial runway.

[00:00:42]>> You know, exactly how long is your runway? We are generally told to have, you know, money set aside for three to six months if we were to lose our jobs.

[00:00:51]And uh that's really important. Now I would think if you're in the tech sector you may want to go towards the longer end of that you know six to nine months uh because those eight that are laid off finding jobs in the same industry are is getting more difficult.

[00:01:05]>> Okay 3 to six month runway or even longer. So what if someone is already worried that they might be next?

[00:01:10]>> Uh yeah that's I think it's on a lot of people's minds. I certainly in my family around the dinner table that's been a discussion point. uh many family members work in the tech industry >> and uh I've encouraged them to make sure they're familiar with their how COBRA works for insurance is generally the first thing people worry about is their medical insurance for themselves and for their families. Uh so be familiar with how that works. Find out if your company even has a severance package and what that looks like. Uh, and then then again back to the savings plan is like what is your financial plan? And if you feel like you might be on the cutting on the edge of being laid off, it's like look at your your spending. What can you already cut back on?

[00:01:50]>> Uh because that now would not be the time to get a new loan, maybe buy that car to slow down and just be prepare yourself.

[00:01:57]>> Okay. I would imagine and I've not been in that position myself before thankfully but for people who are you know getting laid off learning that comes with all sorts of emotions and you know you're you're frantically trying to figure out what the heck do I do in this position what do you do first financially if you ever come to the fact that you're laid off from a job >> yeah the first answer might surprise you and that is do nothing >> just pause uh because generally I find and in other studies have shown that in the first two weeks is when the uh most devastating financial decisions happen after losing a job.

[00:02:33]>> Okay?

[00:02:33]>> Because people tend to go into a mode of like sometimes like you know what I'm going to go on a trip.

[00:02:37]>> I I because I got time now and that can be a really a financially devastating decision to make uh because you spend too much. Uh other people take their 401k from their work and they end up cashing it out or making investment decisions that have huge tax consequences. So really take a breath, slow down, pause, [laughter] you know, find find an Adam Powell, right? Find somebody just to bounce ideas off of.

[00:03:02]Maybe not so much even to hire me, but just like let's have a conversation >> and just like take a beat, you know, and and slow down a little bit.

[00:03:09]>> Don't go wild with the free time.

[00:03:11]>> Right. Right.

[00:03:11]>> Okay. So, let's talk about savings, short-term savings specifically. Where should viewers keep their emergency funds, maybe?

[00:03:17]>> Yeah. You know, actually it's a a great time for those that have cash uh for savings opportunities. One that comes to mind are high yield savings accounts.

[00:03:27]Those right now uh are playing uh paying yeah a good interest rate far better than the bank. Uh you know, I don't want to put too much uh uh talk down about banks too much. who need them. But banks, we fall into an inertia of putting our money there when we're younger, maybe in college, and we have this, you know, bank account, and we think that's where we should keep our money.

[00:03:49]>> Those rates are extremely low. You know, if you, let's just say you have 10 or $20,000, you're leaving anywhere from $4 to $800 of interest, free money I call it, on the table every year >> by not having a high yield savings account. So, that that'd be my first recommendation is to move your money there.

[00:04:05]>> US treasuries are paying really well.

[00:04:07]that really are quite competitive. Um, and then, um, another thing is I bonds.

[00:04:13]I The I stands for, uh, in uh, inflation, excuse me. So, inflationary bonds, and they're backed up by the the government.

[00:04:20]>> Um, and inflation just went up. I'm not sure if you guys talked about it here recently, but the CPI index just came out and it just went up to 4.26%.

[00:04:28]>> Wow.

[00:04:29]>> So, that's really good for those who have cash and want to save. Not so much good when you go out to buy eggs and milk, >> right? No. when you're talking about savings, uh, you know, we were just talking about, you know, where you put some of your money when you're trying to save. What's the biggest mistake that people make, would you say?

[00:04:43]>> I would say that they, again, I mentioned earlier, they they fall into leaving it at a bank. They think that it's safe, and it is safe, but it's safe at a very, very, very low interest rate.

[00:04:53]Uh, banks, again, they have a lot of overhead. You see their names on stadiums and so forth. Uh, but when you go to a high yield savings account that doesn't have so much brick and mortar, you're able to to keep more of your own interest versus it going to the financial institution.

[00:05:07]>> Any recommendations for finding that high yield savings account? I know I mean there's so many different >> There's a bunch of them out there. I mean, I I can I I personally use Marcus.

[00:05:14]I like Marcus. There's Ally, that's out there. Capital One. There's a a bunch of them out there. Um, again, if you just go, you know, kind of go look it up on the internet, like high yield savings accounts, I think those one I just mentioned will probably pop up really quickly and you tie them to your bank account and you can move money very very quickly. So, it's a great place for emergency funds.

[00:05:34]>> Speaking of emergency funds, real quick, I I want to show we mentioned inflationary bonds or the I bonds that is not a place for emergency funds. And the reason why is you get a very you get a higher interest rate return, but you have to keep your money there for a certain amount of time to get the full value of it.

[00:05:48]>> Okay.

[00:05:48]>> Interesting. Lots of good information.

[00:05:51]>> Break it down in such a conversational, [laughter] easy way to understand it.

[00:05:54]>> Yes, he does. Hopefully, we're never in that position of of needing to rely on some of that after a layoff. Thank you, Adam. Thank you so much.