Laid off unexpectedly? For women over 50, this concern can be overwhelming. It’s not just about retirement anymore; it’s about job security.

Many express this fear to me: “I’m not scared of retiring; I’m worried about losing my job before I’m ready.”

Statistics support this anxiety. Almost 64% of older workers fear age-related job risks, spiking to 67% among women over 50. When layoffs occur, women often face longer unemployment, averaging 31 weeks compared to 23 weeks for men.

This combination of job insecurity and extended unemployment can be particularly challenging for women, affecting both emotional and financial health.

But preparing for the potential of a layoff doesn’t have to stem from fear. It can emerge from a place of confidence and a solid plan. Here are some actionable steps.

Fortify Your Financial Base Before Year-End

Start with your financial fundamentals. One of the best things you can do before December 31 is to boost your emergency savings.

Even adding $200 to $500 can significantly enhance your safety net, easing the strain if you experience an income gap. This cushion helps avoid selling investments in a downturn just to make ends meet.

Think of it as a gift to your future self.

Create a “Layoff File”

While no one enjoys contemplating layoffs, being prepared can empower you. Think of this as your “emergency folder.”

Assemble a digital or physical file with crucial financial and employment documents. This way, if you face a job change, you can respond calmly and effectively.

Having organized paperwork can enhance your leverage, especially during negotiations for severance or healthcare benefits.

Your “layoff file” should include:

  • Your last two years of W-2s and pay stubs.
  • A copy of your health insurance policy.
  • Your Social Security statement.
  • Documents related to equity compensation (stock options, RSUs, ESPPs).
  • Beneficiary designations, which are separate from your will.

Explore Healthcare Options Beyond COBRA

Post-layoff healthcare can be daunting. After losing employer coverage, you’ll receive information about COBRA, which allows you to keep your existing plan at your expense. It’s the default option many assume is best.

However, COBRA tends to be the priciest choice.

Thanks to the Affordable Care Act (ACA) rules valid until 2025, your premiums on the marketplace depend on your projected income, not your previous salary. This means if your income declines post-layoff, your healthcare expenses may also drop significantly.

For example, a woman whose earnings drop from $150,000 to $60,000 could see her ACA premium fall from around $1,200 monthly to less than $200. Remember, though, that the future of ACA affordability is uncertain.

So, don’t assume COBRA is your only option. Review ACA plans first, and if you’re married, consider joining your spouse’s employer plan as a potentially easier and cheaper alternative.

Stay Informed About Equity Compensation

If you have stock options or RSUs, timing is essential. These equity compensations can be valuable, but layoffs can complicate matters.

RSUs vest after certain conditions are met, meaning if you’re laid off before that, you could lose them. Additionally, a layoff could lead to unexpected taxes if RSUs vest at the same time.

Stock options typically expire 90 days post-separation. Missing this window means losing them entirely.

You don’t need to be an expert, but understanding your company’s policies is crucial. Consulting a fee-only fiduciary advisor familiar with equity compensation could save you significant money.

Develop a “Recession-Ready” Budget

It’s wise to maintain a budget that you can quickly adjust in case your income changes. This isn’t meant to restrict you but to provide stability during uncertain times.

Start categorizing your expenses into three groups: essentials (housing, insurance, utilities), necessary but variable (groceries, transportation, healthcare), and flexible luxuries (items you can pause without significant impact).

This categorization allows you to see where adjustments can be made without major disruptions. A “recession-ready budget” gives you flexibility when you need it most.

Also, ensure your emergency funds are working for you. High-yield savings accounts and short-term T-bills are currently yielding about 4-4.3%, helping your cushion grow while remaining untouched.

Seek Out Tax Opportunities

A lower-income year can reveal unexpected tax benefits.

You might convert part of a traditional IRA to a Roth at a lower tax rate or strategically realize capital gains while remaining in a lower bracket. Charitable donations can also be more tax-efficient during income dips.

For those aged 59½ or older, a year with reduced income is an ideal time to make penalty-free IRA withdrawals to bridge temporary gaps.

A fee-only advisor can help you navigate these strategies based on your unique situation.

Empower Yourself

Women over 50 often manage multiple responsibilities, from caring for aging parents to juggling demanding careers. When job security feels threatened, it can weigh heavily. Taking proactive steps now can help safeguard your independence.

If you need assistance understanding your options—whether regarding stock compensation, healthcare, or tax strategies—seek advice from a fee-only fiduciary who prioritizes your interests.

Being prepared doesn’t require you to have all the answers today. What you need is a plan that offers peace of mind, ensuring you won’t be taken by surprise.