Then the health insurance bill arrives, and the sting turns into a punch.
If you have ever looked at continuing your employer's plan through COBRA, you already know the number can be shocking.
What fewer people realize is how much worse that number has gotten in the past two years.
COBRA lets you keep your workplace health plan for up to 18 months after leaving a job, but there is a catch the size of a mortgage payment.
Your employer used to cover most of the premium.
Once you are on COBRA, you typically pay the full amount yourself, plus a small administrative fee that can run about 2 percent.
Average employer family coverage now runs north of $25,000 a year, according to annual surveys from KFF, and single coverage sits around $8,900.
Strip out the employer contribution and a family could be staring at roughly $2,000 a month just to stay insured.
Deductibles have ballooned too, so the coverage you are paying so much for may not kick in until you have spent thousands out of pocket.
Meanwhile, groceries, auto insurance, and credit card rates have all climbed, leaving less room in the budget for a surprise health bill.
Households that once absorbed a layoff with savings now put it on a card at 20-plus percent interest.
There is a workaround, but it is easy to miss.
The American Rescue Plan's full COBRA subsidy expired long ago, yet the Health Insurance Marketplace still offers premium tax credits for many households.
For a lot of people, an ACA plan costs hundreds less per month than COBRA, especially if income drops after a job loss.
The trade-off is a new network and possibly a new deductible.
You generally have 60 days from the date coverage ends to elect COBRA, and you can often enroll in a Marketplace plan during a special enrollment window triggered by losing job-based coverage.
Compare both side by side before you commit, because choosing COBRA does not lock you out of switching later in most cases, but missing a deadline can.
Also check whether you qualify for Medicaid.
In the 40-plus states that expanded eligibility, a single adult with modest income may pay nothing at all.
And if you have a spouse or partner with employer coverage, a special enrollment period usually lets you join their plan instead.
The hard truth is that COBRA was designed as a bridge, not a long-term solution, and its price tag now reflects a health care system where costs keep outrunning wages.
Treat it as one option among several, run the numbers the same week you lose coverage, and do not let loyalty to your old plan drain your savings.
Final Thoughts
A few hours of comparison shopping can be worth thousands of dollars.