If you have been made redundant, it’s important to take action so you can protect the lifestyle you’ve worked hard to achieve. Depending on the size of your redundancy payout and your current savings, you may want to reduce your spending to help see you through until you secure another position.
MAKING THE MOST OF YOUR MONEY
You could consider depositing your redundancy payout into an online savings account or a cash management account. This may give you the potential to earn extra interest while you determine what to do with your redundancy payment longer term. There are also other choices you could consider. It may be worth speaking to a financial adviser who can explore these with you.
WATCH YOUR BUDGET
It may take some time to find a new job. So it’s a good idea to plan how your finances will see you through to re-employment. Get in touch today to get help understanding what you spend and identifying areas where you can cut back.
YOUR MORTGAGE AND OTHER DEBT
Some people use part of their redundancy payment to pay off debts like their home loan, personal loans or credit cards. But take into account how long you may be out of work and how much money you will need to cover your expenses over this time. If you do put some money towards your debts, you may want to pay off those with higher interest rates first such as credit cards.
MANAGING MORTGAGE REPAYMENTS
Keeping up your monthly mortgage repayments when you’ve lost your income is often a priority. Contact your lender to talk through your options if you’re concerned you may be out of work for some time and you’re worried about paying your mortgage. Delaying or restructuring your repayments, extending your loan term, switching to an interest only option, or using your redundancy payment in a mortgage offset account may be options to help you manage your financial situation through this period.
REVIEW YOUR EMPLOYEE BENEFITS
You may need to make decisions about your life insurance and super contributions. Your super may be affected in ways you may not have anticipated after you leave your employer:
- You may lose some or all of your insurance cover when you are made redundant. So check to see if insurance continuation options are available if it looks like you’ll lose your cover when you leave your current role.
- You may not be able to claim against your salary continuance, income protection or TPD policy if you are injured or ill while you are out of work. If you’re made redundant, check with your insurer to find out how your policy is affected.
- You may lose your employer benefits or any fee discounts.
- Your super contributions from your employer will cease.
Check with your super fund for more information about how your superannuation benefits might be affected.
SEEK PROFESSIONAL FINANCIAL ADVICE
You may also want to consider seeking financial advice to help you make informed financial decisions in times of redundancy so you can continue to reach for your long-term financial goals.
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