Get Laid Off? 7 Best Ways To Use Your Last Paycheck for Maximum Financial Impact

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According to a recent survey from Clarify Capital, 1 in 3 Americans have layoff anxiety in 2025, with 13% of respondents admitting that they had no savings. With uncertainty about the economy, many companies are expected to announce layoffs in 2025.

If you feel like you’re on the verge of losing your job or you’ve just been laid off, it’s crucial that you know that you have options and resources to help you get through this challenging period. Below are the seven best ways to use your last paycheck after losing your job to make it stretch as far as possible.

Also here’s what to do if you are worried about job security.

Cover Your Essentials

“Prioritizing your essentials like housing, groceries and minimum debt payments might be the smartest move,” said Lon Welsh, founder and managing partner at Ironton Capital. Since this could be your last paycheck for a few months, you want to set aside the money for your essentials.

Melissa Cox, certified financial planner (CFP) and owner of Future-Focused Wealth, recommended prioritizing the four essentials: housing, food, utilities and transportation. She said this will keep your life steady while you figure out what’s next. Your first objective is to ensure that you have the funds set aside to cover your essential bills because you never know how long it’s going to take you to find a new job. Then, you can proceed to the next step.

Consider Prepaying Your Bills

“A great move to make with your last paycheck is to prepay essential bills like your rent, car note and phone for the next month or two,” said Destiny Chatman, consumer expert at TopCashback. “Paying bills early buys you breathing room, giving you time to recover and reducing financial stress.” By taking care of some of your bills in advance, you won’t panic about due dates and you can focus on finding a new income stream and figuring out what’s next for you.

Cut Discretionary Spending

“Outside of covering essentials, cut all discretionary spending and redirect it to your emergency fund or savings account,” Chatman said. “This is one of the fastest ways to prepare yourself during uncertain times.”

Most financial experts will agree that you should extensively review your fixed expenses when you’re trying to save money. You can start by reviewing your last credit card bill to identify any subscriptions that you can cancel. You may need to make some difficult choices, such as canceling your Netflix subscription or pausing your gym membership, as you try to determine the best use of your last payday.

Welsh wants you to think of any cuts as a temporary financial cleanse. “Remember, your last paycheck isn’t for indulgence, it’s your financial life jacket,” he added.

Figure Out How Long Your Savings Will Last

Cox stressed the importance of sitting down to map out your cash runway. She advised reviewing your final paycheck and any emergency savings to determine how many weeks or months you can realistically stay afloat. This clarity will be empowering as you figure out your next career move.

This will also help you determine how to time decisions regarding unemployment benefits and health insurance coverage. You can also decide whether you’ll have to consider side gigs or temporary work.

Stick To Minimum Payments For Now

It’s important that you resist the urge to throw extra money at debt. You want to stick to minimum payments because you can tackle the balances again once you land back on your feet with a new job. You want to be diligent about setting aside money for the essentials with this final paycheck.

Spend Some Money On Your Side Hustle

Welsh noted that this might be the right time for you to reevaluate your income streams, including side gigs or part-time consulting, while job hunting. If you already have a side hustle, consider investing some money in it. If you want to start a side gig, you can review different ways your last paycheck can help you get your foot in the door.

“Facing the loss of your main source of income is hard, but it’s also the best time to pivot,” Chatman explained. “If you’ve been dreaming of making a hobby into a side hustle, now’s the time.”

You can use a portion of your last paycheck to focus on your business or to invest in yourself. You can spend some money on a digital course, getting your domain set up, new software, or any possible registration fees related to your side gig.

Invest In Your Job Search

“If you have a little wiggle room, consider investing in your job search with your final paycheck,” Chatman said. “Acquire a new certification to elevate your portfolio, upgrade your resume, or buy new interview-ready attire.”

You may use your last paycheck to help you become the best candidate, allowing you to find a new job quickly. With some free time on your side, you can finally take the weekend course or have a professional help you review your resume to ensure that you land the best possible job.

“Losing a job is stressful, but your last paycheck is a chance to show yourself you’ve got the tools to stay afloat,” Welsh added.

Sources

• Clarify Capital, “How Layoff Anxiety Is Reshaping Job Security in 2025.”
• Lon Welsh, Ironton Capital.
• Melissa Cox, Future-Focused Wealth.
• Destiny Chatman, TopCashback.

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