Redundancy is a prospect that most working people fear. Despite this, a surprising number of Australians fail to put a plan in place that could protect them should such a scenario arise.
The consequences of redundancy are arguably more severe as you get older, due to the increased likelihood of having dependents, a mortgage, and other accumulated debts or bills.
So, what are some of the ways to reduce the impact of redundancy?
Contemplate reducing and consolidating your debts as soon as possible
Thinking about your debts may cause you a lot of unwanted stress. You could consider using any redundancy pay-out or your savings to pay off your personal loans, credit cards, or other unpaid debts.
The above strategy may help you to reduce your monthly outgoings and buy you valuable time until you find new employment.
Check your eligibility for unemployment benefits
Unemployment benefits often have a certain social stigma attached to them however it’s wise to find out whether you’re eligible. Even receiving a small amount of additional money each month may help you to keep your head above water while you find a new job.
Create a budget that will get you through unemployment
It goes without saying, things are likely going to be tougher for you financially if you’re experiencing redundancy. Start creating an emergency budget that factors in your essential needs, such as debt and mortgage repayments, bills, food, transport etc. as this could help provide some relief.
Consider your career path: similar or new?
While redundancy can be an unexpected life event, many people choose to pursue totally new career paths in the face of adversity. Thankfully, there are government re-training assistance programs that you may wish to take advantage of after your redundancy period concludes. Alternatively, you can simply seek to find work in the same sector you previously worked in.
Take out a Loan Protection Plan before you need one
Redundancy can strike anyone and at any time, no matter your profession, age, or gender. So, why not do your best to protect your financial security should the worst happen?
At ALI, our Loan Protection Plan could offer financial aid should you fall into involuntary unemployment in the first five years of taking out a policy. That means, if you end up facing redundancy, you could have peace of mind knowing that ALI may pay you up to three months’ benefit to help you get back on track and working again.
Want more information? Our local ALI-authorised mortgage brokers can help. Alternatively, feel free to request a loan protection quote.
Loan Protection Plan is jointly issued by Hannover Life Re of Australasia Ltd ABN 37 062 395 484 (Death, Terminal Illness, Living and Accidental Injury Benefits) and QBE Insurance (Australia) Limited ABN 78 003 191 035 AFSL 239545 (Involuntary Unemployment Benefit). It is distributed by Australian Life Insurance Distribution Pty Ltd ABN 31 103 157 811 AFSG 226403 (ALI). ALI receives commission for each policy sold. Any advice provided is of a general nature only and does not take into consideration your personal objectives, financial situation or needs. You should consider the Product Disclosure Statement when deciding if this product is appropriate for you.