How to manage your finances after receiving a redundancy
When you accept a redundancy offer you may receive a number of payments including:
- Redundancy payment – which may have 2 components – a tax-free component and an Employer Termination Payment (ETP).
- Annual leave owing to you.
- Long service leave owing to you.
To determine the best use of your redundancy pay-out, you need to address the following questions:
- How much income do you/your family require while you are looking for work?
- How much funds do you have that are readily accessible?
- What large expenses have you planned for over the next 12 months?
- How long do you think it will take to find new employment?
- Do you wish to apply for Centrelink’s Newstart Allowance?
- Do you need to move your superannuation out of your employer super fund?
- Do you have any “non-preserved” superannuation funds?
- After you leave your employer, will you lose your insurance cover?
- What debts do you have?
- If you have a mortgage – do you have a re-draw facility on your mortgage?
How can financial advice help?
The advisers at Prudentia Financial Planning can help you:
- Restructure your assets and funds so that you have sufficient income while looking for work, which may include eligibility to receive Centrelink benefits.
- Determine the best use of the redundancy funds.
- Making the most of your superannuation funds.
- Ensure you continue to have adequate personal insurance cover to ensure you are protected against illness or accident while looking for work.
- If you are over 55, determine whether you can afford to retire or return to work on a part-time basis.
- Re-evaluate your financial strategies once you re-enter the workforce.
Make sure you’re being smart with your money.
If you would like more information on finanical strategies, please download the White Paper or contact Prudentia Financial Planning for a complimentary first consultation.