Layoffs · Career Transitions · Equity Planning

Tech career transitions
deserve specialized
financial guidance.

Whether you are navigating a layoff, between roles, or weighing a new offer, the financial complexity of a tech career transition is real. Equity, severance, COBRA, and 401(k) decisions made under pressure can affect your position for years. We help you get them right.

See the First 60 Days
The First 60 Days

The clock starts
the day you get
the news.

A tech layoff is not just an employment event. It triggers a series of financial deadlines, many of them hard stops with no extensions. Missing them can mean losing health coverage, forfeiting equity, or triggering an unplanned tax bill.

Most people focus on the job search. The financial decisions that happen in parallel are equally important and often more time-sensitive.

Tech layoff data sourced from TrueUp.io and Crunchbase News. In 2025, approximately 246,000 tech workers were laid off across 783 companies. In 2026, more than 166,000 have been impacted as of mid-year, with Q1 2026 representing the highest quarterly total since early 2023.

01

Review Your Severance Agreement

Understand what you are being offered, any clawback provisions, non-compete language, and whether severance is contingent on a release of claims. In many cases there is room to negotiate before you sign.

Time-sensitive: Before you sign
02

Understand Your COBRA Window

You have 60 days to elect COBRA, and coverage is retroactive if you elect before the deadline. You also have a simultaneous 60-day special enrollment window for ACA marketplace plans, which may cost significantly less depending on your income.

Hard deadline: 60 days from coverage loss
03

Review Equity Grant Documents

Stock options often have a post-termination exercise window as short as 90 days. Unvested RSUs typically do not accelerate. Review your equity plan documents immediately to understand what you have, what expires, and when.

May be as short as 90 days for options
04

Assess Your Cash Flow Runway

Calculate your monthly expenses versus liquid assets and severance income. Establish a clear picture of how long you can sustain your current lifestyle without new income, and identify where to adjust if needed.

Immediate
05

Plan for the Tax Year Impact

Severance is taxable income. If you also have RSU vesting, option exercises, or other equity events in the same calendar year, the cumulative tax picture can be complex. Proactive planning before year-end can meaningfully reduce your bill.

Before year-end
What Most People Get Wrong
Health Insurance Strategy

You do not have to
decide on day one.

Most people receive their COBRA paperwork and feel immediate pressure to decide. What most people do not know is that the 60-day election window is a strategic resource, not just a deadline.

If you elect COBRA on day 59, your coverage applies retroactively to the day your original insurance ended. There is no gap in coverage. This means you can spend the full 60 days comparing COBRA against ACA marketplace plans without risking your coverage, as long as you act before the deadline expires.

Losing job-based coverage also triggers a simultaneous 60-day special enrollment period for ACA marketplace plans. If your income drops significantly due to the layoff, you may qualify for substantial income-based subsidies that make a marketplace plan far less expensive than COBRA.

The right choice depends on your expected healthcare usage, your projected income for the year, whether your current doctors are in your insurer's network, and your financial runway. We help you evaluate both options with the numbers in front of you before either deadline closes.

COBRA rules and deadlines sourced from the U.S. Department of Labor. ACA special enrollment period information sourced from HealthCare.gov. This information is for educational purposes only and does not constitute insurance or legal advice. Consult a licensed insurance professional for coverage recommendations specific to your situation.

Key Deadlines

The COBRA and ACA timeline after a layoff.

Day 0
Coverage ends. Your last day of employer-sponsored health insurance. Often the last day of the month of termination, not necessarily your last day of work.
Day 14
COBRA notice due. Your former employer must send your COBRA election notice within 14 days of notifying the plan administrator of your termination.
Day 60
COBRA election deadline. Hard stop. Elect on day 59 and coverage is retroactive to day 0. Missing this permanently eliminates your COBRA rights. Your ACA marketplace special enrollment window also closes simultaneously.
+45
First premium payment due. 45 days after electing COBRA, your first payment covers the period retroactively from day 0.
18 mo.
Standard COBRA maximum for employees. Certain qualifying events extend coverage to 36 months for dependents.

Source: U.S. Department of Labor, dol.gov. Federal COBRA applies to employers with 20 or more employees. State mini-COBRA laws may provide similar rights for smaller employers.

What We Do

Financial planning built
for the transition.

Severance Analysis

Reviewing your severance offer, understanding what may be negotiable, evaluating non-compete provisions, and modeling the tax impact of how severance is structured and when it is paid.

Health Insurance Strategy

Comparing COBRA versus ACA marketplace plans based on your projected income, expected healthcare usage, and premium costs. Helping you use the 60-day window strategically rather than reactively.

Equity and RSU Planning

Reviewing your equity grant documents to understand vesting schedules, post-termination exercise windows for options, and the tax treatment of any RSUs or option exercises in the transition year.

401(k) Rollover Strategy

Evaluating whether to roll your 401(k) into an IRA, leave it with your former employer, or roll into a new employer plan. Ensuring the rollover is executed correctly to avoid triggering taxes or penalties.

Cash Flow and Income Gap

Building a clear picture of your financial runway based on liquid assets, severance, and monthly expenses. Identifying which accounts to draw from first and where to reduce spending to extend your runway.

Transition Year Tax Planning

Modeling your full income picture for the calendar year including severance, equity events, unemployment, and new employment income. Identifying strategies to reduce your tax bill before year-end.

A Different Perspective

A layoff creates a
planning window most
employed people
never have.

When you are employed, financial planning happens in the margins. There is rarely time to step back and look at the full picture: your investment allocation, your insurance coverage, your retirement trajectory, your estate plan.

A layoff forces that pause. And for people who use it intentionally, it can be the moment when everything gets aligned: the right accounts, the right investments, the right coverage, and a clear plan for what comes next.

The job will come back. The question is whether you have used this time to build a financial foundation that no single employer can take away.

The Bigger Picture

This is not just a gap in employment. It is a gap in the noise.

Use it to consolidate old 401(k) accounts from previous employers into a single IRA where you have full control and visibility. Use it to review your beneficiary designations and confirm your estate documents reflect your actual life. Use it to optimize your investment allocation rather than inheriting whatever your employer's plan offered.

Many clients who have navigated a layoff tell us afterward that the financial clarity they built during the transition was something they had been meaning to do for years. The layoff made them do it.

"The decisions you make in the next 60 days will outlast whatever happens in the next 60 days of your job search."

Common Questions

Tech layoff financial planning, answered.

What should I do financially in the first 30 days after a tech layoff?

The most time-sensitive priorities are reviewing your severance agreement before signing, understanding your COBRA timeline and ACA marketplace alternatives, identifying any equity deadlines such as post-termination option exercise windows, assessing your emergency fund runway, and filing for unemployment if eligible. A fee-only financial advisor can help you sequence these decisions and avoid costly mistakes under time pressure.

How long do I have to elect COBRA after a tech layoff?

You have 60 days to elect COBRA, starting from the later of the date your employer coverage ends or the date you receive your COBRA election notice. You do not need to decide on day one. Electing on day 59 still applies coverage retroactively to the date you lost your original insurance, so there is no gap in coverage. This 60-day window gives you time to compare COBRA with ACA marketplace options before committing. Missing the deadline permanently eliminates your COBRA rights.

What happens to my RSUs and stock options after a tech layoff?

Unvested RSUs typically do not accelerate upon a layoff unless your severance agreement or equity plan specifically provides for acceleration. Vested RSUs that have not been sold are generally yours to keep. Stock options often have a post-termination exercise window as short as 90 days, after which unexercised options expire permanently. Reviewing your equity grant documents promptly is critical, as missing these deadlines means losing compensation earned over years of employment.

Should I roll over my 401(k) after a tech layoff?

In most cases, rolling your former employer 401(k) into an IRA gives you broader investment options, potentially lower fees, and greater flexibility. However, if you plan to return to work quickly and your new employer plan has strong institutional funds, or if you may need the Rule of 55 for early penalty-free withdrawals, staying in the plan may make sense. The rollover must be completed correctly to avoid triggering income taxes and early withdrawal penalties. A fee-only advisor can evaluate your specific situation.

Is my severance pay taxable?

Yes. Severance pay is generally treated as ordinary income and is subject to federal and state income taxes as well as Social Security and Medicare taxes. Your former employer will typically withhold taxes and report severance on a W-2. If you also receive equity compensation income, RSU vesting, or other payments in the same calendar year, the cumulative tax picture can be complex. Consult a qualified tax advisor before year-end. See our disclosure page for additional information.

What is the ACA marketplace special enrollment period after a layoff?

Losing job-based health coverage triggers a 60-day special enrollment period for ACA marketplace plans through HealthCare.gov. This window runs simultaneously with your COBRA election window. If your income drops substantially due to the layoff, you may qualify for income-based premium subsidies that make a marketplace plan significantly less expensive than COBRA. Evaluating both options with actual premium numbers before either deadline closes is one of the most valuable actions you can take in the first 60 days.

Take the Next Step

You have 60 days to make
decisions that matter.
Use them well.

Schedule a free 30-minute consultation with Mark Chalem, CFP to work through your severance, health insurance, equity, and 401(k) decisions with a fee-only fiduciary who has no conflicts of interest and no products to sell. Available to tech workers nationwide.

Send a Message
(618) 967-5958 mark@1618wealth.com
FINRA
Verify AdvisorBrokerCheck