Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to johnstevens77,Bhoddhisatva,scotia,Anonymous,Cornytiv34, for Donating to support the site

Redundant at 52 ?

Including Financial Independence and Retiring Early (FIRE)
Fenix
Posts: 9
Joined: July 27th, 2018, 9:39 am
Been thanked: 4 times

Redundant at 52 ?

#267630

Postby Fenix » November 27th, 2019, 12:19 pm

Just looking for some wise heads on this.

I'm going to be made redundant at 52. I've only been told this just now so it's all new to me and my head is a mess.

My company lets me take early retirement at 55 and i BELIEVE (not had chance to get it confirmed yet) that I can take the redundancy and still take the early retirement at 55 if i wish.

Married - no children under 18 and no mortgage. Wife earns about 20k and is happy in her job.

I would get a package that would be just about 2 years salary. I believe I can take 30k tax free and the rest I can pay into my pension pot - so my pension at 55 would be thereabouts what I thought it would be if I carried on working.

According to my budgeting - I can make the 30k last two years and then I just have a year or so to go until I'm 55. Once I get my Pension at 55 then I should be fine.

Am I missing anything obvious ?

I do feel like I need to take some time out - but I'd possibly look for a part time job for pocket money maybe ?

I'm sure I'm missing something but I've not yet had chance to meet with anyone who can help - as I say it's only just happened.

Many Thanks

Fenix

taylor20
Lemon Pip
Posts: 66
Joined: November 4th, 2016, 11:59 am
Has thanked: 10 times
Been thanked: 22 times

Re: Redundant at 52 ?

#267633

Postby taylor20 » November 27th, 2019, 12:30 pm

One thing to consider is life insurance, e.g. From memory my pension pays a (discretionary) lump sum of 3x salary on death in service, however once the pension is 'deferred' the lump sum is significantly less. Also the survivor's pension is calculated differently once the pension is deferred (or at least once 'retired').

Alaric
Lemon Half
Posts: 6033
Joined: November 5th, 2016, 9:05 am
Has thanked: 20 times
Been thanked: 1399 times

Re: Redundant at 52 ?

#267636

Postby Alaric » November 27th, 2019, 12:32 pm

Fenix wrote:Am I missing anything obvious ?


I don't think so. If you are only expecting the redundancy lump sum to last a couple of years, you presumably invest it with caution.

Check though what sort of deal you are getting on the income from your pension by taking it at 55, rather than 60 or 65 and whether it will be enough to support you for the rest of your lifetime.

farwide
Posts: 9
Joined: November 27th, 2019, 12:16 pm
Has thanked: 16 times
Been thanked: 5 times

Re: Redundant at 52 ?

#267642

Postby farwide » November 27th, 2019, 12:43 pm

Sorry to hear about that, Fenix.

I think there's two main things here.

First, your financial security. It reads to me that (subject to confirmation of all of the details) you can probably work something out on this front to keep you afloat and bridge to your pension, just about. Others have already started advising on this I see.

Second, where do you want to go from here? It's pretty clear you weren't expecting this. The fact that you're already talking about a part-time job before you've even left this one suggests to me that you're not really ready to retire at the moment.

With no knowledge of your industry/skills, as a generalisation it can be more difficult to find a new job in your fifties. If it were me, I'd say it's build a plan on a spreadsheet time.

Plan some time for fun stuff, of course.
Plan some time for some personal goals (fitness? learn a language?) - whatever.
Plan some time for dusting off your CV
Plan some time for job-hunting.

Whatever you do, plan to fill your days - it's too easy to stagnate otherwise.

Best of luck!

Fenix
Posts: 9
Joined: July 27th, 2018, 9:39 am
Been thanked: 4 times

Re: Redundant at 52 ?

#267650

Postby Fenix » November 27th, 2019, 1:12 pm

Thanks for the responses - I thought I was fairly sorted until I've just been informed that the Pension I thought I would be getting at 55 is subject to a reduction - because I've left the company before 55... Nobody has mentioned that so far.

Very frustrated as it's not my idea to go !

Yes there's plenty of other activities to fill up my week - but finances are the biggest worry now. I can't decide until the pension figures are given to me.

Just when I thought everything was covered eh ?

Please do feel free to continue to comment !

Thanks again.

TUK020
Lemon Quarter
Posts: 2039
Joined: November 5th, 2016, 7:41 am
Has thanked: 762 times
Been thanked: 1175 times

Re: Redundant at 52 ?

#267651

Postby TUK020 » November 27th, 2019, 1:16 pm

Fenix,
3 points, only one of which is financial.

I have been made redundant in the past, the first time was from a company I had been with for 20 years. The emotional shock is something to think about and take time over. It is much easier to accept what is happening at an intellectual level, than it is to deal with at an emotional level. If you have been working there for any length of time, you have just been set free! But it may take a while before you see it in those terms.

Second point is that you may well be offered some financial advice as part of your severance package. Use it, particularly in understanding the tax implications - particularly on the "rest I can pay into my pension pot" bit.
Fenix wrote:I believe I can take 30k tax free and the rest I can pay into my pension pot - so my pension at 55 would be thereabouts what I thought it would be if I carried on working.

Any financial advisor will also offer to manage your money for a fee; you don't need to pay attention to this part.
It may depend on your notice period, but one thing to think about is whether you can negotiate to get part of your severance paid in April - new tax year, gives you some more breathing space.

Lastly, 52 is probably to early to "stop". Better to think about this as an opportunity to change career into something that no longer needs to have remuneration as one of the headline requirements. What is it you would really like to do with your life? Something that is very well worthwhile to read is "Managing Oneself", an HBR article by Peter Drucker.
https://signallake.com/innovation/managing_oneself.pdf

good luck with seizing the opportunity
tuk020

swill453
Lemon Half
Posts: 7962
Joined: November 4th, 2016, 6:11 pm
Has thanked: 984 times
Been thanked: 3643 times

Re: Redundant at 52 ?

#267652

Postby swill453 » November 27th, 2019, 1:17 pm

If you haven't done it already, you need to do a budget. How much do you need to live on?

You can base it on your current actual expenditure, and adjust it to take account of not doing your current job (Commute cost down? Leisure expenditure up?).

Once you know this you can work out whether your pension (once you get an accurate quote) and your wife's income is enough to live on.

Scott.

JohnB
Lemon Quarter
Posts: 2497
Joined: January 15th, 2017, 9:20 am
Has thanked: 677 times
Been thanked: 997 times

Re: Redundant at 52 ?

#267655

Postby JohnB » November 27th, 2019, 1:28 pm

Check your national insurance record and get a state pension forecast. If you don't think you'll be paying more NI, you might want to see what back years you can pay, some will be cheaper than others. Don't leave it too near the end of the tax year, if you have to write a letter, it can take months for them to respond.

SalvorHardin
Lemon Quarter
Posts: 2049
Joined: November 4th, 2016, 10:32 am
Has thanked: 5297 times
Been thanked: 2465 times

Re: Redundant at 52 ?

#267657

Postby SalvorHardin » November 27th, 2019, 1:33 pm

A few thoughts (most of this comes from personal experience, having retired early some 16 years ago):

Have a good look at what you are spending and work out your budget. You may be able to get by on less than you think because being in work costs a lot (e.g. commuting, food, coffee, clothes). When I worked in the City it was quite common for people to be spending up to one-third of their after-tax income just on getting to work (and then there's the sandwiches and coffee for breakfast from the shops). You will now have more time to shop at a variety of supermarkets, which can create huge savings, rather than the time pressure of being at work forcing you to limit yourself to one (or maybe two). A friend who recently retired is probably saving £100 a year on cinema tickets because they can now go in the afternoon when there are cheaper seats.

What are you going to do with yourself? You've just found out that you are being made redundant - this may be an even bigger shock than you realise if a lot of your social life revolves around work, because that will change when you leave. Taking away the structure provided by work can cause problems. It's all too easy to veg out in front of daytime TV watching stuff that you're not all that interested in. When I retired (very early) I immediately signed up for an Open University Law degree which gave me something around which to structure my time. Nowadays I do watch a lot of TV, though it's by choice and mostly sports (e.g. April is Indian Premier League Cricket, July is the Tour de France, etc.)

Part-time jobs. I know several people who retired early who work a variety of part-time jobs. Racecourses are often looking for staff for racedays (working on the fences is great if you like the outdoor life). County Cricket grounds and rugby clubs also have matchday jobs; these are like steward jobs at football matches but without the aggro as it's a different type of clientele that you have to deal with. You may have hobbies that you could use to generate a part-time income.

Good luck!

Bouleversee
Lemon Quarter
Posts: 4652
Joined: November 8th, 2016, 5:01 pm
Has thanked: 1195 times
Been thanked: 902 times

Re: Redundant at 52 ?

#267691

Postby Bouleversee » November 27th, 2019, 3:06 pm

And there are always old ladies who would be happy to pay you a reasonable sum for helping in the garden and other odd jobs on a flexible basis. :)

tjh290633
Lemon Half
Posts: 8208
Joined: November 4th, 2016, 11:20 am
Has thanked: 913 times
Been thanked: 4096 times

Re: Redundant at 52 ?

#267695

Postby tjh290633 » November 27th, 2019, 3:20 pm

I got made redundant at 57, after 22 years. I had two avenues to go down. One was to be self-employed using my technical knowledge. The other was to look for a job. I wrote to everybody who I knew in my branch of industry and was pleasantly surprised to get a message from one acquaintance telling me not to commit myself until he had spoken to me when he next came to the UK. The upshot was that I worked with some old friends for a further 8 years in a field which I knew well.

Had that not happened, I might have seriously considered looking for a job in a field where I had worked many years ago, to whit, bus driving (although I was a conductor in those days). As it happened, after I retired I started as a volunteer driver for our community bus, which turned out to be a very pleasant pastime cum occupation.

If you do decide to retire early, my suggestion is to look for work doing something that you will enjoy. It doesn't have to be well paid, it can be voluntary, but it may well lead to further things.

TJH

Fenix
Posts: 9
Joined: July 27th, 2018, 9:39 am
Been thanked: 4 times

Re: Redundant at 52 ?

#267698

Postby Fenix » November 27th, 2019, 3:30 pm

Thanks again everyone - all of this is gold dust at a time when I'm really not able to function that well.

Definitely will take advice on the tax aspect.
I'm also given a small amount for retraining purposes- not quite been able to think what this should go on and I need clarity on how long that offer is open to me. I do kind of get the feeling that head count is someones target for the year and if they can get me out before year end so much the better....

Luckily I have been keeping a budget so I do know what outgoings I have, and my initial calculations show I should be fine, but I've asked for precise figures from the company.

I do keep fairly active and there are some friends who have also retired early so I'll be looking to up the exercise levels and yes some kind of studying does appeal. There are also volunteering opportunities in the local area.

State Pension is a good call. I' 4 years short of a full amount - so will look into seeing if I can top this up ?

Tax year isn't something I'd considered before so that's a good shout.

The article on strengths and weaknesses looks fascinating. Sent that home for a proper read later.

I'm quite touched by all the advice on here - so fantastically useful. Really appreciate your time and effort.

thebarns
2 Lemon pips
Posts: 220
Joined: November 4th, 2016, 12:56 pm
Been thanked: 126 times

Re: Redundant at 52 ?

#267719

Postby thebarns » November 27th, 2019, 4:12 pm

Fenix,

Being made redundant (or not) could be down to luck, one person’s (ill) judgement, timing, financial matters at your employer completely beyond your control, any number of other matters.

So my tuppence worth is don’t dwell on the actual decision and just focus on the opportunities from here on in.

In my time as a boss, we made only one person redundant and that was because that person had a mixture of being truly awful at the job, an appalling attendance record and a deceitful attitude. Undoubtedly they deserved redundancy from our business, compared to the small hundreds of employees who worked in the business over the years.

I have known many who absolutely did not deserve redundancy, but were made redundant for factors beyond their control and not correlated to their performance as employees - the key is not to dwell on the injustice.

I must also say I have unfortunately known quite a few others (not in our business) who have undoubtedly gamed the system and received quite staggering voluntary redundancy awards, also with little correlation to their previous performance !

Fenix
Posts: 9
Joined: July 27th, 2018, 9:39 am
Been thanked: 4 times

Re: Redundant at 52 ?

#267729

Postby Fenix » November 27th, 2019, 4:32 pm

thebarns wrote:Fenix,

Being made redundant (or not) could be down to luck, one person’s (ill) judgement, timing, financial matters at your employer completely beyond your control, any number of other matters.

So my tuppence worth is don’t dwell on the actual decision and just focus on the opportunities from here on in.

In my time as a boss, we made only one person redundant and that was because that person had a mixture of being truly awful at the job, an appalling attendance record and a deceitful attitude. Undoubtedly they deserved redundancy from our business, compared to the small hundreds of employees who worked in the business over the years.

I have known many who absolutely did not deserve redundancy, but were made redundant for factors beyond their control and not correlated to their performance as employees - the key is not to dwell on the injustice.

I must also say I have unfortunately known quite a few others (not in our business) who have undoubtedly gamed the system and received quite staggering voluntary redundancy awards, also with little correlation to their previous performance !


Oh yes - quite get this. I'm in the wrong role at the wrong time. I've also seen injustices in my years here. There's a possibility I could move around the business but I think I've done enough in this industry and need to get back out into the world anyway. Thanks for your advice.

swill453
Lemon Half
Posts: 7962
Joined: November 4th, 2016, 6:11 pm
Has thanked: 984 times
Been thanked: 3643 times

Re: Redundant at 52 ?

#267739

Postby swill453 » November 27th, 2019, 4:55 pm

thebarns wrote:In my time as a boss, we made only one person redundant and that was because that person had a mixture of being truly awful at the job, an appalling attendance record and a deceitful attitude. Undoubtedly they deserved redundancy from our business, compared to the small hundreds of employees who worked in the business over the years.

Sounds more like a sacking than a redundancy. Or were the competence, attendance and attitude used to score them against the other potential candidates?

Scott.

jonesa1
Lemon Slice
Posts: 263
Joined: May 27th, 2019, 9:47 am
Has thanked: 103 times
Been thanked: 142 times

Re: Redundant at 52 ?

#267745

Postby jonesa1 » November 27th, 2019, 5:03 pm

Presumably you're on a final salary or career average pension? If so, you need clarity on how the trustees apply early retirement discounts. Usually there is a "normal retirement age" at which you'll get the full pension, with deductions for taking it early, usually as a % per year that you are early. Depending on the generosity of the scheme, the early retirement discount can make a huge difference. Once you're no longer active in the scheme, the value of your pension gets limited indexation. It's also worth understanding what level of indexation you'll get once the pension is in payment, is it statutory minimum (nothing on pension earned before April '97, CPI capped at 5% from '97 to April 2015 or CPI capped at 2.5% from April 2015), or something better? If we again get periods of high inflation, the level of indexation will be important and it could be wise to make sure you have other assets invested in something which is likely to cope with inflation better than capped indexation.

James
Lemon Slice
Posts: 295
Joined: November 4th, 2016, 3:12 pm
Has thanked: 69 times
Been thanked: 111 times

Re: Redundant at 52 ?

#267746

Postby James » November 27th, 2019, 5:13 pm

thebarns wrote:
I must also say I have unfortunately known quite a few others (not in our business) who have undoubtedly gamed the system and received quite staggering voluntary redundancy awards, also with little correlation to their previous performance !


I once worked with someone who found a new job and was planning to tell his line manager on the Friday. For various reasons, he bottled it. First thing Monday morning, he was called in to his manager's office to find HR there with redundancy notice and offer of a substantial payout.
He was not unduly disappointed.

EssDeeAitch
Lemon Slice
Posts: 655
Joined: August 31st, 2018, 9:08 pm
Has thanked: 268 times
Been thanked: 251 times

Re: Redundant at 52 ?

#267750

Postby EssDeeAitch » November 27th, 2019, 5:24 pm

Fenix wrote:
Am I missing anything obvious ?

I do feel like I need to take some time out - but I'd possibly look for a part time job for pocket money maybe ?

Fenix


Re Job Hunting.

Speaking as someone who owned a recruitment company: I saw many people who decided to "take some time out" before starting their job search after being made redundant. Employers would very often look at these candidates and wonder why they have not yet got a job regardless of being told that the delay was intentional. They seemed to think the worst - "the candidate is saying they deliberately took time out but perhaps they just cant get a job, or are not very clever at planning, or are half hearted about getting a job". Taking time out was generally viewed as a negative. Also, it can take a lot longer than anticipated to get the job offer that appeals and so whether your really want a full/part time job or not, I would advise an immediate job search.

You can always turn an offer down but you cannot recover time.

Good luck with it all

Hariseldon58
Lemon Slice
Posts: 835
Joined: November 4th, 2016, 9:42 pm
Has thanked: 124 times
Been thanked: 513 times

Re: Redundant at 52 ?

#267772

Postby Hariseldon58 » November 27th, 2019, 6:59 pm

Having ‘retired’ at 49 from a long standing career, I did not have a financial need to return to work and hand an enjoyable time, after six months I had one day when I had nothing to do and off I went doing something part time for a few years, after that a further part role doing something that I had wanted to do when younger. I massively downplayed the financial side of these roles and enjoyed the process, presently I am pretty busy travelling, a little volunteering and being busy !

This redundancy could be the best thing that’s happened to you, if you let it. Many years ago I was a detective, that was then and as time passes, these prior careers are like a good book, enjoyable first time round , occasionally fun to revisit the old chapters but don’t bother with the sequel !!

AsleepInYorkshire
Lemon Half
Posts: 7383
Joined: February 7th, 2017, 9:36 pm
Has thanked: 10514 times
Been thanked: 4659 times

Re: Redundant at 52 ?

#267775

Postby AsleepInYorkshire » November 27th, 2019, 7:10 pm

Fenix wrote:Just looking for some wise heads on this.

I'm going to be made redundant at 52. I've only been told this just now so it's all new to me and my head is a mess.

My company lets me take early retirement at 55 and i BELIEVE (not had chance to get it confirmed yet) that I can take the redundancy and still take the early retirement at 55 if i wish.

Married - no children under 18 and no mortgage. Wife earns about 20k and is happy in her job.

I would get a package that would be just about 2 years salary. I believe I can take 30k tax free and the rest I can pay into my pension pot - so my pension at 55 would be thereabouts what I thought it would be if I carried on working.

According to my budgeting - I can make the 30k last two years and then I just have a year or so to go until I'm 55. Once I get my Pension at 55 then I should be fine.

Am I missing anything obvious ?

I do feel like I need to take some time out - but I'd possibly look for a part time job for pocket money maybe ?

I'm sure I'm missing something but I've not yet had chance to meet with anyone who can help - as I say it's only just happened.

Many Thanks

Fenix

Hi Fenix,

You have skills. You also have a personality. You have just been given an opportunity. Take it. Don't look back. That's the wrong direction. Don't try to understand anything about any of this other than the fact that you have just been given an opportunity. And if you're a worrying sort (many of us are :roll: ) then worry about not taking this fantastic opportunity and doing something constructive with it. You have it within your gift to come out of this smelling of roses. Whatever you choose to do will be right. You can't do anything wrong from here. Unless, that is, you're going to start reflecting upon your decisions. The beauty of making your own decisions is you can change them if you feel the need.

There's absolutely nothing I can say to help you with your finances. There are far better equipped people using these boards who will offer advice and food for thought. I've read some of the posts and as is usual for TLF the replies have been incredible.

If you look forward now you may see a proverbial ball coming your way. Smash the darn thing straight out of the park. Hit it so hard Superman couldn't stop it. :lol:

I've some fond memories of being made redundant (I work in construction - a famine and feast industry if ever there was one and the early 80's was a hard time). I can look at myself in the mirror these days and respect how I dealt with it.

Good luck

AiY


Return to “Retirement Investing (inc FIRE)”

Who is online

Users browsing this forum: Salvelinus and 10 guests