Just Laid Off From HubSpot? Here’s the 3 Most Important Things to do Next
On October 6, HubSpot announced it was cutting nearly 660 jobs, about 7% of the company. If you were one of them, the first week probably felt like a blur of Slack messages, LinkedIn posts, and a separation packet you haven't fully read yet.
There's a lot you could worry about right now. These are the three things I'd focus on first.
1. Read the agreement before you sign anything
HubSpot is offering 20 weeks of base pay plus one week for each year of service, up to 30 weeks. That's generous. But the number on the first page isn't the whole story.
When you go through the agreement, look for:
Your equity: what happens to unvested RSUs. Some companies accelerate a portion as part of severance, and some don't. HubSpot did offer equity vesting in its 2023 layoffs, but don't assume the same terms apply this time.
Your deadline: most agreements give you a set number of days to sign. Use them.
What you're giving up: signing usually means releasing legal claims against the company. If anything about your situation feels off, an employment attorney can review it before the deadline.
How you'll be paid: a lump sum or installments. That affects both your cash flow and which tax year the money lands in.
2. Your severance comes with a tax bill nobody mentions
Severance is taxed as wages. Employers usually withhold federal tax on it at a flat 22%, which sounds reasonable until you add it to everything else you earned this year.
Say you earn $150,000 and have four years at HubSpot. That's 24 weeks of severance, or about $69,000. At 22%, roughly $15,000 is withheld for federal tax. If that payment pushes you into the 32% bracket, you'll owe closer to $22,000. That's a $7,000 surprise in April, before state taxes and any RSUs that vested this year.
The fix is simple. Set aside more than what's withheld, and talk to your CPA about whether an estimated payment makes sense.
There's an upside, too. If you're between jobs for a while, a lower-income year can be a good time for moves like Roth conversions.
3. Protect your runway before making big moves
Severance buys you time. The goal is to make sure it buys as much as possible.
Know your number: add up your severance after tax and savings, then divide by your monthly expenses. That's how many months you have to find the right job, not just the next one.
Sort out health coverage: compare COBRA with a marketplace plan. Marketplace subsidies are based on income, so a lower-income year can make them cheaper than you'd expect.
Leave your 401(k) alone: cashing it out triggers taxes and, if you're under 55, usually a 10% penalty. If you have a 401(k) loan, find out when it's due, since unpaid balances can become taxable.
Rethink your HubSpot shares: RSU and ESPP shares made sense as part of working there. Now they're just a stock you happen to own. Decide whether you'd still choose to hold that much of it.
Take a breath first
You don't need to solve everything this week. Read the agreement, plan for the taxes, and protect your runway. The rest can wait until you've had a chance to think clearly. And if you’d like some help, click here or below to book a time to chat:
I'm Michael Walstedt, a fee-only wealth advisor at Reliant Wealth Advisory. I help tech employees navigate layoffs, severance, and equity compensation.
This article is for educational purposes only and is not tax, legal, or investment advice. Severance details are based on public reports and may differ from your agreement. Consult a qualified professional about your situation.
