One part of the appeal of my current position is its proximity to home, albeit these days that's only of benefit 1-2 days a week. I suspect I may have to choose between a position with a similar salary or a position with a similar commute.If management want to keep you then I'd guess you'd have no concerns finding a similar position elsewhere. Is that correct? Can you get a similar position without any reduction in career prospects and without any reduction in quality of life (e.g. if new job required increased commute etc)?
This is my primary concern. I may find myself unable to do my job due to the significant cutbacks being made. On the flip side, periods like these usually offer opportunities for advancement which would not otherwise be available. Downside risk though is greater than the upside.What is the organization going to be like after the redundancies? Will you be staying on a sinking ship?
Up until now, I was on a certain path and hadn't given serious thought to alternatives. This sum could for instance clear a lot of our mortgage, which may give me options I wouldn't have considered before. Who knows, it may well be life-changing.For a lot of people it would be a life changing amount of money but considering your position as you've outlined it I don't think it is. More of a cherry on top.
Great to hear someone who's been through it, and that it worked out well.I was in a similar position, albeit less money, and took the money. Haven't looked back. Moved on to similar roles and use the payment to make things easier (reduced mortgage etc).
You got to be careful with this approach. If you give the impression that you want to leave, the company could decide why pay him off when he intends to leave anyway and will probably go of his own accord if he doesn't get the redundancy package.indicating my preference/intention sooner rather than later, before anyone starts a process to retain my position.
If you take the package I would only use maximum half to pay down the mortgage. The opportunity cost of holding the rest in cash is not all that high for the time it takes you to get re-settled in your career. This may involve re-training and you could burn through more cash than you think. You'll at least be entitled to nine months jobseekers benefit if you are made redundant but this is taxable.Up until now, I was on a certain path and hadn't given serious thought to alternatives. This sum could for instance clear a lot of our mortgage, which may give me options I wouldn't have considered before. Who knows, it may well be life-changing.
If you've been with the same company for a long time (this must be the case given the size of the package) then my advice would be to take the money. Offers like this don't come around very often. If you do decide to take the money then start preparing your CV immediately. Get professional assistance. Get your linkedin profile updated and connect with as many recruiters as possible. With the size of the package you shouldn't be in a panic to find a new job. Take your time and do as many interviews as possible. The process will probably take months.Would you have any advice for someone about to go through the process?
Not at all, in fact I think you should take the financial aspect out of your decision making. You are very comfortable financially for your age with a relatively small mortgage vs your income and a lot of equity in your PPR plus a very healthy pension pot at 40.This is new territory for me, so does anyone think I'm mad to give up the certainty of my job for a payout like this?
For example, if it is purely a cost cutting restructure , you could end up doing more work with less resources, getting more frustrated and ultimately ending up in the same position (redundancy) in a couple of years. Or worse, you might leave out of frustration at the lack of resources which would mean missing out on a big redundancy.I may find myself unable to do my job due to the significant cutbacks being made
I would second this, decide what you want to do first before lumping it all on the mortgage. With childcare & mortgage payments, your monthly commitments will stay relatively high so it is better to have that available to you in cash if you plan to take time out or at least until you find a new roleIf you take the package I would only use maximum half to pay down the mortgage. The opportunity cost of holding the rest in cash is not all that high for the time it takes you to get re-settled in your career
The company that made me redundant paid for a consultant to assist with CV and Linkedin profile creation and interview preparation.Professional assistance wasn't something that I'd immediately thought about (@PGF2016, do you mean a career coach?) but perhaps would be a good idea to tease this out further.
Correct, though there wouldn't be a lump sum per se. You would roll your whole pension over into a ARF, annuity etc Once done it would be subject to tax once you start to draw it down.I've just been told that my role is to be made redundant, likely effective before the end of this year (consultation period with the employer just about to start). Been with the company almost 20 years so a lot of emotions going through me right now. Early 50s as well, so I think getting a similar role will be difficult - a friend in recruitment has been quite open with me on that (I work in Finance, in a multinational). Anyways, all that aside, I need to focus on the here and now. Can anyone provide some clarification on the following queries?:
- waiving the right to the pension lump sum. I am in a DC scheme, and the admin portal has a forecasting tool. Based on my current and projected contributions (assuming of course those contribution levels were to be maintained, unlikely now perhaps), at the age of 65 I could be entitled to a lump sum of approx €150k. If I waive the right during the course of redundancy discussions, does this effectively mean that this pension lump sum figure would then become fully taxable, and at the marginal rate?
Find out what your company policy is. You mention its a MNC so I'd be highly surprised if they don't have one. It should detail what applies for the bonus payment, ditto for RSUs (if applicable) and any other benefits.- the annual company bonus is a discretionary payment (typically it is a significant amount). I will have worked the full year, but the related payment is made during quarter 1 of the following year, at which point I will have left the company. Probably have to suck it up, but has anyone been in a similar position, and negotiated a payment with the employer in lieu of same? I feel I have made the usual contribution for the full year, but ultimately my employment contract does state that it is discretionary.
Assuming you'll receive an ex-gratia payment, tax relief is a really important topic. Given your length of service, SCSB is likely to be the most beneficial to you. Recommend to read up thoroughly on it, here's one link I came across, there are many others. Other things which come to mind include, how long they will continue to pay health insurance (if applicable), what support / training they will provide & will they offer time off for interviews.- there are some good insights already on this thread, and the related forum so I'm reading up as much as possible on the topic. But if there is anything else that I should be considering or prioritising during this consultation period, I'd really appreciate your inputs.
Thanks in advance.
yes, would echo this, no need to be writing yourself off, most finance experience is transferrable to a multitude of industries.I really wouldn't write yourself off if you work in finance in your early 50's........Still plenty of opportunities out there. Even on the project/consultancy side if you have the experience.
There are plenty of threads here on redundancy and tax. If you work for a MNC, more than likely they will set you up with independent legal and financial advice. Generally, they tend to be quiet supportive when making these decisions. Usually, the rule is don't waive your right to a tax free amount under your pension in exchange for a higher amount after tax now. There are some circumstances where it makes sense but you need to do the maths and get advice. You won't be able to do anything the pension provider provides you with Present Value calculations which the company will arrange.
In the meantime, I would highly recommend updating your Linkedin Profile and start networking and getting in contact with people. It really has become critical in todays market.
A significant organisational change at the firm I work for may mean redundancy is on the cards later this year. Due to my tenure, there could be a large ex-gratia payout (250-300k before tax). However, I've heard I may be one of a select few who management "fight" to retain.
I'm giving strong consideration to taking the package regardless, and indicating my preference/intention sooner rather than later, before anyone starts a process to retain my position.
Yes, that's my problem, & why I think it's best to make my preference clear beforehandAre you sure the choice is yours?
If the company really wants to retain your position, would it not simply be the case that no redundancy applies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?