What happens financially if you lose your job?

Unemployment benefit I, Bürgergeld, health insurance: how long the money lasts and when it gets tight, shown by two households with the same gross pay and very different outcomes.

Nobody plans to lose their job. But the system behind it is documented, and knowing it lets you make better decisions before it happens.

The amounts below are based on the calculation formula used by the Bundesagentur für Arbeit (Federal Employment Agency, § 153 SGB III). The flat-rate net pay is not the actual net on your payslip, but an amount calculated by a fixed formula. Tax class, number of children, and marital status affect the result considerably.

Unemployment benefit I: 60 or 67 percent

Anyone who was in employment subject to social insurance and paid contributions for at least twelve months in the last two years is entitled to unemployment benefit I (Arbeitslosengeld I, §§ 137ff. SGB III). The amount: 60% of the flat-rate net pay, 67% for people with children. Not of your actual net pay, but of an amount calculated by a flat-rate formula.

The maximum period you can draw it depends on your age and how long you were previously employed. For most employees under 50, the rule is: a maximum of 12 months. From age 50, the period can rise to 24 months, depending on your contribution time (Bundesagentur für Arbeit, 2026).

What comes after unemployment benefit I

Anyone who hasn't found work after their unemployment benefit I runs out, and who is in need, moves on to Bürgergeld (basic income support, SGB II). The standard rate for single people in 2026 is €563 a month. On top of that come reasonable housing costs (rent plus heating) and, where applicable, additional needs.

The difference from unemployment benefit I is considerable. Someone who earned €2,500 net gets around €1,500 a month on unemployment benefit I. On Bürgergeld, considerably less, depending on housing costs and assets. Your own assets have to be used up down to a protected allowance.

Health insurance when you lose your job

Losing your job doesn't end your health insurance. If you were previously in the statutory health insurance (GKV, gesetzliche Krankenversicherung), you automatically stay a member, without paying contributions out of your own pocket while you draw unemployment benefit I (§ 5 Abs. 1 Nr. 2 SGB V). The Bundesagentur für Arbeit covers the contributions during that time.

If you had private health insurance (PKV, private Krankenversicherung), you have to keep your contract going yourself. For most privately insured people, that's a substantial monthly cost that has to be factored into your cash-flow planning.

The emergency fund: how much is enough?

The rule of thumb for an emergency fund: three to six months of spending as a liquid reserve. The Deutsche Bundesbank recommends something similar, using monthly net income as a reference point (Deutsche Bundesbank, publication on private retirement provision and liquidity reserves, 2023).

Three months is enough if your income is stable and your job prospects are good. Six months or more makes sense for the self-employed, in uncertain fields, or where the household leans heavily on a single income.

An emergency fund isn't a bookkeeping exercise, it's the foundation of financial stability: income and expenses stay in balance even when one income drops out for a while.

• Unemployment benefit I: 60% (67% with a child) of the flat-rate net pay, a maximum of 12 to 24 months depending on age and contribution time.
• Bürgergeld 2026: €563 standard rate plus reasonable housing costs.
• Health insurance: while drawing unemployment benefit I, automatically covered through the statutory health insurance, with the contribution paid by the Bundesagentur für Arbeit.
• Blocking period (Sperrzeit): anyone who resigns or signs a termination agreement risks a blocking period of up to 12 weeks with no benefits.
• Emergency fund: 3 to 6 months of spending as a guide.

Miravel shows you how long your household can bridge financially with its current reserves and unemployment benefit I, and which expenses you could adjust first.

Know the system before you need it

The same situation, two different outcomes

Picture two people. Both earn €3,500 gross a month. Both have paid more than 24 months of contributions into unemployment insurance. Both lose their jobs.

Lena (38) lives in Hamburg. Married, one child, tax class III. Taras (34) lives in Frankfurt. Single, no children, tax class I. He came from Ukraine six years ago and has worked in employment subject to social insurance in Germany for four years.

Same gross pay, very different outcome

Lena, Hamburg. Tax class III, 67 percent.

The flat-rate net pay is worked out from gross pay minus a flat 20 percent social insurance deduction, minus flat-rate wage tax by tax class. For Lena (tax class III, €3,500 gross), the flat-rate wage tax comes to almost zero. That puts her flat-rate net at around €2,800. That's the basis for calculating unemployment benefit, not Lena's actual net pay.

Because she has a child, she gets the higher benefit rate: 67 percent. Unemployment benefit I: around €1,876 a month.

• Lena's previous actual net pay: around €2,630/month
• Unemployment benefit I: around €1,876/month
• Partner's income (net): €2,200
• Kindergeld (child benefit): €259
• Household total: around €4,335/month
• Gap to her previous income: around €754/month
• After the Hamburg Warmmiete (around €1,550): around €2,785 left over

Tight, but manageable. Two incomes cushion the drop.

Taras, Frankfurt. Tax class I, 60 percent.

Same gross pay, different outcome. For Taras (tax class I, €3,500 gross), the flat-rate wage tax comes to around €458 a month. That puts his flat-rate net at around €2,342.

No children, no higher rate. Unemployment benefit I: 60 percent of €2,342 = around €1,405 a month.

• Unemployment benefit I: around €1,405/month
• No second income, no Kindergeld
• Frankfurt Warmmiete: around €1,100
• After rent: around €305 for groceries, insurance, everything else

That barely covers it. Without savings, it gets critical within a few weeks.

How long does unemployment benefit I run?

The benefit period depends on your age and how long you were previously employed (§ 147 Abs. 2 SGB III). With 24 contribution months and under 50, the rule for both is: a maximum of 12 months.

12 months — Maximum benefit period for both: under 50, with 24 contribution months. After that comes Bürgergeld, a standard rate of €563 plus housing costs.

• 12 contribution months (in the last 2 years): 6 months of entitlement
• 24 contribution months: 12 months
• 30 contribution months, from age 50: 15 months
• 36 contribution months, from age 55: 18 months
• 48 contribution months, from age 58: 24 months

Once unemployment benefit I runs out, and where need is established, Bürgergeld follows (§ 19 SGB II). The 2026 standard rate for single people: €563 plus reasonable housing costs. The difference from unemployment benefit I is considerable.

Blocking period: resign and you lose out

Anyone who resigns or agrees to a termination agreement without good cause risks a blocking period (Sperrzeit) of 12 weeks (§ 159 Abs. 1 Nr. 1 SGB III). During that time there's no unemployment benefit. On top of that, the total entitlement is permanently cut by a quarter.

Health insurance when you lose your job

Anyone who was in the statutory health insurance before losing their job stays in it without paying contributions themselves, as long as they draw unemployment benefit I (§ 5 Abs. 1 Nr. 2 SGB V). The Bundesagentur für Arbeit covers the contributions. The same rule applies to Taras, regardless of the fact that he comes from Ukraine. Anyone who had private health insurance has to keep the contract going themselves.

Am I entitled to unemployment benefit I as someone who immigrated here?

Yes, if the qualifying period is met: at least 12 months of employment subject to social insurance in the last 30 months before becoming unemployed (§ 142 SGB III). Citizenship plays no role. EU citizens, non-EU citizens with a work residence permit, and Ukrainian nationals with temporary protection are treated equally, as long as the contribution time adds up.

What's the difference between unemployment benefit I and Bürgergeld?

Unemployment benefit I is a contribution-funded insurance benefit: you paid in and get an income-related amount back. It isn't means-tested. Bürgergeld is tax-funded basic income support: it's means-tested, and your assets are counted. The 2026 standard rate is €563 plus reasonable housing costs, regardless of your previous income.

How exactly does the Bundesagentur calculate unemployment benefit I?

The basis is the assessment pay: the average wage of the last 52 weeks before unemployment. From that, a flat-rate net pay is derived: gross minus a 20 percent social insurance flat rate minus flat-rate wage tax by tax class. That gives the benefit rate: 60 percent for people without children, 67 percent for people with at least one child.

What happens to health insurance after you lose your job?

Anyone who was in the statutory health insurance stays in it while drawing unemployment benefit I, without paying contributions themselves (§ 5 Abs. 1 Nr. 2 SGB V). The Bundesagentur pays the contributions. Anyone who had private health insurance has to keep the contract going themselves. The premiums keep running, often at full rates.

How big an emergency fund do I need?

As a guide: three to six months of spending as a liquid reserve. Three months is enough with stable household income and good chances of finding work again. Six months or more makes sense for single-earner households or in less stable sectors. Taras's situation shows why: with only €305 left over after rent each month, a reserve of €5,000 is used up within a few months.