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Merry Christmas! You're Fired

There are only two weeks until Christmas, so it's time to make last-minute purchases, finalize travel arrangements, and -- for some people -- find a job.

Merrill Lynch(NYSE: MER), Schlumberger(NYSE: SLB), Sprint(NYSE: FON), UAL Corp.(NYSE: UAL), Sara Lee(NYSE: SLE), AOL Time Warner(NYSE: AOL), Maxtor(NYSE: MXO), and Charter Communications(Nasdaq: CHTR) are just some of the companies that have announced layoffs in the past week. The cuts come on the heels of the announcement that unemployment in November hit an eight-year high.

The possibility of job loss is the No. 1 reason everyone should have an emergency fund. The standard recommendation is to have six months' worth of expenses in an easily accessible, safe account, such as a money market account. (You can learn more about where to stash your emergency cash in our Short-Term Savings Center.)

If you've been the victim of a "downsizing," "restructuring," or a "chainsawing," here are some tips.

Make sure you have continuous health coverage. The government has given you some breathing room by mandating your right to remain insured under your former employer's policy for a period of time. Called COBRA, the law provides for continued coverage when you leave your job for reasons other than gross misconduct. You have 60 days from the time you are laid off or from the day your current coverage ends (whichever is later) to choose to stay on with your employer's plan. You must pay the employer's cost for such coverage, and the employer may, and probably will, charge you an extra 2% for administrative expenses. However, it is usually cheaper than getting a policy on your own.

Look into unemployment benefits. If you didn't receive any severance pay, or after your severance runs out, you can apply for unemployment benefits at your local Unemployment Insurance Claims Office, Employment Service Office, or Mom and Dad's Generous Check-Writing Office. Eligibility rules and size of benefits are determined by each state. Keep in mind that this is not welfare; this is insurance that your employer has paid for as part of your benefits.

Use the Web for your job search. There are numerous online resources for folks looking for a job. We're not just talking about "Help Wanted" listings. Many sites provide tips on assembling a résumé, doing well in an interview, and career advice. Here are a few:,,,,,,,,,,,,,,,, (ya gotta dream, baby!).

Press for more severance benefits. If you feel like you deserve a better deal from your employer, make your case. Maybe you can get an extra week or two of severance pay or an extension of health benefits. Perhaps they'll permit you to use some of their resources for your job search. We're talking about things that go above and beyond what your former employer legally owes you. So ask nicely. If you were the victim of a large layoff, then make your case soon; your employer won't be able to accommodate everyone's requests.

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