August 3, 2016
Receiving a Layoff Notice
No matter the situation, leaving a job is an emotional and intimidating experience. It is especially terrifying when it wasn’t something you had planned for ahead of time. However, there are steps you can take to aid in your financial well-being and peace of mind. The sooner these important items are handled, the better.
Inventory your financial situation. It is important to have a firm understanding of what kind of income you will be living on and how long will it last. Here are a few questions you will need to figure out the answer to:
- If you are married and your spouse works, can you afford to live off one income?
- Were you offered a buyout package?
- Will you be able to draw unemployment benefits?
- How can you cut some expenses out of your monthly budget to extend your income?
- If you use up your current funds, can you draw from another source? Do you have assets that can be liquidated? You don’t want to draw from your retirement accounts, but if needed, do you have investments that you can use with minimal tax penalties?
Review your insurance policies. Ask to review your employer’s policies on medical, dental, and life insurance. Find out what happens following the loss of your job. Will you be able to maintain your coverage for a certain amount of time? If so, you will not want to delay in completing the appropriate forms to extend your coverage.
Understand your retirement accounts. You will need to take a look at your retirement account portfolio and see if it still fits with your current economic situation. How susceptible to risk (risk tolerance) is your current portfolio? If you are unexpectedly unemployed, you may want a portfolio that is more stable or adverse to risk. If you have a 401(k), pension, or another retirement account through your former employer, what are your options? What is the best way to keep your retirement savings while minimizing the implications on your taxes?
Together with our affiliate, AHP Financial Services Inc., we are in a unique position to assist individuals who have recently lost their job. We have tax experts and retirement planning professionals who can work together to help guide you through this difficult time and make sure it isn’t as stressful, both emotionally and financially.