Week 1: orientation, not action
The week your last day is confirmed is for confirming numbers and avoiding decisions. Get the final pay breakdown from payroll in writing. Confirm the redundancy, PILON, holiday and any ex-gratia figures match what your contract and the statutory formula require. Use the redundancy pay calculator and PILON calculator to check the maths.
Don’t make any major financial decisions in this week. People in the first shock of redundancy often cancel insurance policies, raid pensions, or take the first job offered. Each of these is harder to reverse than they look. Wait until week two minimum. The lump sum will sit safely in your bank account; nothing is gained by rushing.
Week 2: build a runway picture
The single most useful thing in the first month is a clear view of how long the money lasts at current spend. Take the total of your final pay (after tax), plus any savings you can reasonably use, divide by your current monthly outgoings, and that’s your runway in months. Aim to extend that figure as far as possible without changing your quality of life.
The biggest variable is fixed monthly costs. Subscriptions, unused gym memberships, software you don’t need now you aren’t working, and entertainment services you can consolidate. A typical UK household finds £150-£400 per month of savings within an hour of looking. That’s 1-2 months extra runway on most redundancy packages.
Weeks 3-4: the job-search basics
Update the CV before applying anywhere. The version you used to get the role you just lost is rarely the right version for the next role. Strip out anything more than 8-10 years old unless directly relevant. Add measurable achievements in your recent role; redundancy isn’t a performance failure and your achievements are still yours.
Build a list of 20-30 specific people to contact. Old colleagues, former managers, people you’ve respected at companies you’d work for. A short note explaining the redundancy and asking if they know of opportunities works better than a generic LinkedIn announcement. Most UK roles get filled through this network, not through job boards.
Weeks 5-8: applications and conversations
Apply to roles that fit, not to roles where you’d be a stretch in the wrong direction. The temptation to apply broadly is real but usually counterproductive; specific applications convert at 5-10x the rate of generic ones. Aim for 3-5 strong applications per week, not 30.
This is the time to also consider whether the right next move is a different shape entirely. Going freelance, contracting, retraining, or starting a business are all viable choices, particularly if redundancy money provides the runway. See becoming a contractor after redundancy and retraining after redundancy for the practical mechanics.
Weeks 9-12: decision phase
By the end of month two, you should have a sense of whether the job search is working. If offers are coming in, decision-making becomes the focus: which role, which package, which start date. If offers aren’t coming in, the question is whether to adjust strategy (different sector, different level, different geography) or hold the course longer with the runway you have.
This is also when the mental load can spike. Redundancy hits identity, not just income. Don’t treat the fact that you’re looking after yourself as evidence that you aren’t working hard enough on the search. Walking, exercise, sleep, and social contact are not distractions; they’re what makes the search sustainable.
What about the money mistakes to avoid?
The most common ones, in order: cashing out a pension early (don’t — the tax cost is brutal and you lose decades of compound growth), taking a low-quality job in panic at week 3 (rarely the right move), keeping all the lump sum in one current account (move most of it to a higher-interest easy-access account), and forgetting to claim benefits you’re entitled to (New Style JSA in particular is contribution-based and many people overlook it).
Related calculators and articles
- Redundancy pay calculator
- PILON calculator
- Settlement agreement calculator
- Budgeting after redundancy
- Emergency fund after leaving work
- Cutting monthly costs after redundancy
- Retraining after redundancy
- Becoming a contractor after redundancy
- Redundancy pay tax explained
Frequently asked questions
- What should I do in the first week after redundancy?
- Three things: confirm the final pay figures, file the paperwork (P45, claim for JSA if applicable, update your CV), and don't make any major financial decisions yet. The first week is for orientation, not action. Big choices made in shock rarely turn out well.
- How long does redundancy pay typically last?
- For most UK office workers, the statutory redundancy package plus PILON covers 2-6 months of normal spending if managed carefully. The actual runway depends on your weekly pay, years of service, age, and how quickly you adjust monthly outgoings.
- Should I take the first job offer to keep money coming in?
- Usually not, unless your runway is genuinely short. The first 30-60 days of a job search are when your network is freshest and your CV is sharpest. Taking a poor-fit role in week 2 because of panic often leads to a second job search within 12 months.
- Can I claim benefits during redundancy?
- Possibly. New Style Jobseeker's Allowance is based on your NI contributions and isn't means-tested for the first 6 months. Universal Credit is means-tested and looks at your household savings. Both can be claimed; check gov.uk for the current eligibility rules.
General information about navigating redundancy, not financial or legal advice. For your specific situation, contact ACAS or a financial adviser.
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