Severance Package? Do Not Squander It! - November, 2008

I run into a lot of people who squander their severance package or burn up their bank account because of an ineffective job search.  We all feel the changing economy and if we are lucky enough to receive a severance package when downsized, it is a good idea to make a plan for the money and your job search.

When Dan’s employer passed out pink slips, he got a nice severance package.  Two weeks pay for every year of service and he had been with the company for 20 years.  Forty weeks of pay seemed like a lot at the time, so Dan took a few weeks off to do nothing.  Then he got a little busy and decided to buy a new computer and take advantage of the outplacement package offered through his former employer.  The outplacement firm helped Dan with his resume and gave him some general job hunting tips, but they were not set up to give him personal one-on-one coaching nor able to help him with how to transition into another career where he might not have direct experience.  Since he had not looked for a job in 20 years, he played a little in the job hunting websites.  But mostly found himself picking up the kids from school, taking his elderly mother to the doctor and even doing the weekly shopping.  Instead of establishing an hour or two where he focused on his career campaign, he found himself watching TV, reading a few novels, and also found himself sucked into the black hole of playing computer games until the wee hours of the morning.

Unfortunately, Dan was not really enjoying his time off.  His anxiety grew as the weeks turned into months and time raced by. Dan came to see me when he had just one week of severance left.  He was in panic mode.  And as you can probably guess, good career decisions are rarely made in panic mode.

If you have recently received a severance package and want to stay out of the panic mode, the following questions will help:

Severance Package Question 1:
I received a severance package, but can I really afford to take time off?
If you want to take some time off, and can afford to do it, go ahead. Just make sure there is a clear beginning and end to the “vacation.”  Then, get to work in earnest on your job search.

If you plan time off, realize the financial consequences.  If, for example, you are making $100,000 per year, then each week of unemployment will cost $2,000 in lost earnings.  If you received a severance package, then you are using up money you could be banking.  If not, then you are using up money from your rainy day savings.  If you take time off, decide on a date that you want to be back to your job search and back to work.

Remember that the average time to find a job right now takes about 6 months.  (This also depends on the level of demand the market has on your career target.)

Severance Package Question 2:
Even with a severance package, should I consider a stop gap job?
You may want to take a job to keep some money coming in, while you look for the job you want.  It keeps the wolves away and helps keep you sane.  Find something to stop the hemorrhaging.  Those jobs in general are low paying jobs that force you to take deep cuts into your budget.  At times it could require you to make some life changing decisions.  One of the lessons I have learned in life is that if you are not hard on yourself when you need to be, situations and often life itself will take you down a long a painful road of experiences you could have avoided.  Urgency and determination should be your friend!  

Do not lose focus that your real job is now finding a job.  In the job hunt, never go in with the attitude that you will take anything that sounds interesting.  Have a clear target.  Even though it seems that being “open to lots of things” will make your search easier; it will actually take you much longer.  Employers are more interested in an applicant who knows what he or she wants and where their expertise can help that organization than an applicant that is “open to lots of things.”  Clearly targeting an industry or company and the functions you will perform will help you keep focus.  You want to be the aspirin to their headache!  Look for a job with a vision of where you would like to be in three to five years.  If you do not have an idea of where you want to be in three to five years, seek out a career coach who can help you focus your efforts right away, rather than squandering your severance until it is gone.

Severance Package Question 3:
Now that I have the severance package and I am not so pressured, how do I go about developing my job hunting skills as quickly as possible?
If you have been working in the same job for ten years—and many times even if you have not—your job hunting skills could need some polish.  Since, finding work is now your job, set definite hours when you will work, work those hours, just like going to a job, but then allow time to enjoy yourself.

Click here to visit my website and find several tools to help you develop your job hunting skills.  You can listen to an MP3 presentation of From Fiction to Fact – Dispelling Job Hunting Myths.  You can also find other tools that will help you set yourself apart as a valuable contributor. 

Severance Package Question 4:
Is it really smart to squander part of the severance package to pay for help in my job search?
A job search is tough.  Nothing puts you up against your self-esteem faster.  Look and seek out moral support.  Companionship on the journey will lighten the load.  Look for support groups where you leave feeling encouraged.  Be careful not to fall into the trap that being busy by going to every networking event is a wise use of your time.  You can only implement so much at a time and you must find the balance for you.  Some job seekers find comfort in always being the under dog and are driven to attend meetings rather than looking inward and asking the hard questions or seeking professional help.

Many people find that investing in professional coaching support pays big dividends in terms of finding work faster and getting a better job.  Being coached through salary negotiations can yield thousands of extra dollars not to mention the other 55 things you want to evaluate so that you do not leave money on the table.  If you have networked into a job you now have a quality network of professionals that often can be the key to success in your new found position.