With today’s economic uncertainty, many companies are closing or downsizing. If you are offered a severance or early retirement package you need to carefully evaluate the tax and financial planning implications of your options.
A good rule of thumb is not to sign a severance agreement until you’ve had ample time to think it over and do some research. It’s important to understand how this will impact your personal circumstances.
There are several aspects of a severance package that need to be considered such as:
- Cash payment
- Retiring allowance rollovers
- Pension options
- Group benefit options
- Tax implications
A frank discussion with a Financial Planner can help you make informed decisions based on the particulars of your personal circumstances.