Navigating Career Changes and Job Loss

A new opportunity, a role that no longer fits, or an unexpected job loss can shift your direction quickly—and often without much warning. Even when the change is ultimately positive, the transition itself can feel uncertain.

If you’re in the middle of a career change—or suddenly navigating life without a paycheck—it’s completely normal to feel unsettled, and you’re not the only one.

One in four working Americans (26 percent) say they are concerned about losing their job in the next six months, according to Northwestern Mutual’s midyear 2026 Personal Prosperity Index. And among those actively seeking work, 78 percent are concerned about their ability to find employment.

If you’re going through this transition, first take a deep breath. Career changes and job loss can feel uncertain, but you don’t have to figure everything out at once. When tomorrow feels uncertain, experience matters.

We’ve been helping people navigate unexpected resets for over 165 years, and we know that a solid financial plan can adapt to whatever life throws at you.

This guide is here to help you regain your footing and take the next step forward by focusing on what matters most when things change.

1. Don’t worry too much

Depending on the type of transition, you may be feeling uncertainty or stress. Acknowledge those feelings, but don’t let them get you down. After all, more than 4 percent of the population is unemployed at any given time, according to Bureau of Labor Statistics data, and this could be the incentive you needed to find a job that’s a better fit.

If you’re unemployed, finding a new job is probably at the top of your to-do list, but balance hours spent job searching with time catching up on self-care and wellness. Try to keep up with healthy routines like good sleep, exercise, and spending time with friends. This can also be a great opportunity to dedicate time to boosting your professional skills by taking courses, adding certifications, taking exams, or learning new skills. Also think about adding a new hobby, which can give you something to focus on other than finding a new job.

Whatever you do, try to keep a degree of normalcy as you navigate this transition—it'll keep you grounded as you figure out what’s next.

2. Take stock of your benefits

Changing careers or losing your job means you’ll lose benefits or have to navigate new ones—like health insurance. Health insurance is no longer a federal requirement but some states still require it. See if you can be added to your partner’s plan, look into extending your benefits through COBRA, or shop around on the health insurance marketplace for other types of health insurance. If you had an FSA through your employer, make sure you understand important deadlines like the last date to spend unused funds or submit claims.

If you have a 401(k), you’ll have to decide what to do with those funds. At this point, you really have three options: Leave the account as is indefinitely, leave the account as is for now and roll the funds into a new 401(k) at your next job, or roll the money into an IRA. It’s okay if you don’t take action on this right away—you may have a much better idea of what you want to do when you find a new employer and understand its benefit package.

If the only life insurance you had was through your employer, you’ll also want to evaluate whether to add independent coverage. (This is another good reason to carry insurance independent of your employer.) If you’re looking for a more inexpensive option for death benefit coverage, term insurance may be a better fit until you’re able to budget for permanent life insurance.

3. Revisit your monthly budget

With changing income, you’ll want to review money going out. Take a close look at your monthly budget and spending habits, and then have a family meeting to discuss areas to adjust. Could you live without that fancy cable package? Should you go out to dinner less often? Discretionary expenses are a good place to start, and there may even be some fixed expenses you can reduce or cut for the time being. You don’t need to overhaul your entire lifestyle, but see if there are simple adjustments you can make to keep money in your bank account. It’s a good idea to revisit this exercise and review your spending regularly to make sure you’re staying where you need to be.

4. Find sources of cash

If you’ve been saving, you may have an emergency fund reserve to draw on. As you budget, figure out how long you can make it last while looking for your next gig or whether you can add to it in a new higher-earning career. Your financial advisor can help you figure out ways to make your cash reserves last longer or keep debt to a minimum during this transition. Some places you may be able to find extra cash in the short term include:

Unemployment benefits

If you’ve lost your job, you could be eligible to receive a portion of your income for a set number of weeks from the Department of Labor while you look for work. Getting unemployment checks can help you stress less about paying bills while you’re between jobs.

Apply as soon as you’re able, but keep in mind that not everyone qualifies. The Department of Labor says you must be unemployed as a result of circumstances beyond your control, such as company-wide layoffs (rather than bad behavior), and you need to be actively looking for a job. You also must meet your state’s requirements for the length of time worked or money earned. Generally if you had a steady job and earned a full-time wage, you should be covered.

Cash value of a life insurance policy

If you are in need of money, you may be able to take a loan against your existing whole or universal life insurance policy’s cash value. Bear in mind that you’ll need to repay this amount, or the death benefit on the policy will be reduced¹.

If you didn’t have life insurance before, and your budget allows, this may be a good time to consider it to provide future financial protection for your loved ones.

Retirement accounts

If you’re really in need of cash, tapping into your retirement plan should be a last resort.

A Roth IRA is probably your best bet if you have one. Because you’ve already paid taxes on the money, you can withdraw your contributions without penalty. If you withdraw your earnings and you’re younger than 59½, you’ll need to pay the 10 percent early withdrawal policy on those earnings. To access any other retirement accounts, you’ll likely have to pay the 10 percent penalty in addition to income tax on the withdrawal. (For a traditional 401(k), this could result in receiving only 50 to 60 percent of your savings.)²

5. Start the job search

The first step in trying to find your next role is updating your résumé and your LinkedIn profile. Or if you want to shift careers, email 10 friends and ask them what they think you’d be great at. Then go into put-yourself-out-there mode: Talk to people in your network to let them know you’re up for hire. You’ll likely get more leads from acquaintances than those in your close circle. Finally, know the process takes time. Pros say to expect the search to take one month for every $10,000 in salary.

6. You don’t have to navigate this alone

Career changes and job loss are about more than income. They affect your routines, your goals, and how you think about the future.

That’s why having a financial advisor as a long-term partner is so important in uncertain economic times.

A well-designed financial plan can help you:

• Understand how long your resources may last.
• Adjust your strategy without losing sight of your goals.
• Protect your financial foundation during uncertainty.

And just as importantly, it can help you feel like you’re not navigating it all on your own.

When you have that kind of support in place, it’s easier to move forward with confidence—no matter what comes next. Your Northwestern Mutual financial advisor can help.