Experiencing unemployment in the years right before retirement can be an extremely distressing and difficult situation to navigate. Cutting your spending to a bare-bones budget will likely be critical and those who have an emergency fund already saved will certainly weather this storm better than those who do not.
And so the first savings priority for everyone is to ensure they have sufficient short-term reserves to last at least 3 months, but ideally a year. But losing a job later in life can be extra devastating because many people will count on a higher income during this season to save for retirement. For this reason, try to keep some type of income coming in – even if it’s through temping, consulting or working part-time. Not only will this provide some buffer in your budget, but it will also continue contributions to your CPP benefits and better prevent you from having to access your retirement accounts prematurely.
Brush up your resume, start aggressively networking, clean up your social media profile, and if it can be avoided, try to access as little of your long-term savings as possible. Because once you do get a job, the hard work does not stop. You need to replenish your emergency fund, and then actively save for retirement.
Maria Dawes, Portfolio Manager
Capstone Private Wealth