The election is (mostly) behind us. The COVID finish line appears to be on the horizon in the form of a vaccine. Unemployment is down, and it feels like we are starting to turn a corner. But this is still a recession, and for many, that means contending with job loss.

For those nearing the end of their career, being laid off presents a tricky set of questions. Should you jump back into the workforce or retire? Having a process in place to make that decision will help you make one in line with your financial goals.

Deal with the layoff itself

While losing your job can come as a shock, especially if it is unexpected, there are some immediate steps you should take. If your job loss is in the form of a forced early retirement, make sure you are receiving the same benefits as if you retired on your own terms.

If you and your company are on good terms, try to negotiate your severance package. You might, for example, be eligible for extended health benefits, or your end-of-year bonus. Companies don’t like to burn bridges, especially with long-time employees.

When were you planning to retire?

From there, consider your situation in light of when you had planned to retire. If you are within a couple years of your planned retirement age, ask yourself some questions. Do you still love what you do? Are you passionate about your career? If not, and if you are in good financial shape, it might make sense to call it a career.

From an investment standpoint, look at your financial plan, and work with your advisor to see if you have enough to meet the lifestyle you want. Look at your diversification. Can you afford to retire without taking an unnecessary tax hit?

Talk it over with your significant other

If you have a significant other, there are a whole host of additional considerations. First, when do they plan retire, if they haven’t already? If you don’t know, now would be a good time to ask! You’ll be living off their income until they do.

Consider the impact on Social Security

If you haven’t started taking Social Security yet, see if you can afford to take your benefits sooner. Taking benefits sooner will permanently reduce your payout. If you are the higher earner, your spouse’s benefit may be based on your decision after you pass on.



It’s not a binary choice

Don’t feel forced into a choice about your decision one way or another. There is no law that says you must declare your retirement and can never work again.

Taking a year off to consider your options is perfectly acceptable, especially if you are concerned about being active during the pandemic. Maybe your skill set is conducive to consulting work, or maybe you can take a position with reduced hours. Retirement isn’t the either/or decision it used to be.

If you have been laid off, or believe a layoff is imminent, talk to your advisor about your options. The more prepared you are, the more comfortable you will be with the choice you make.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This article was originally published in the Pioneer Press. You may view the article here.