Life Planning On Redundancy

These days there is no guarantee of a job for life with economic or business changes forcing many employers to re-evaluate their business strategies. Inevitably many people, with sometimes lifetime service, are given no option but to take a Redundancy Package.

Quite often these packages have linkages to pension scheme options as well as different ways in which any tax-free payments are calculated.

Understanding Pension Options On Redundancy

If you are a member of a Defined Benefit Scheme, you may need to weigh up whether the best option for you is to remain a member of the scheme (even though you may still be some years off retirement age).

Alternatively, should you take a transfer value to maximise your tax-free lump sum entitlements and maintain easier access to a pension pot that you could access from time to time?

Financial Issues On Redundancy

If it is relevant, do you need to consider using some of the tax-free payments to clear debt or finance children’s education and, if so, what are the financial consequences now and into the future?

All of these scenarios have long term implications and require serious consideration and experienced advice before anyone decides to accept an employer’s redundancy offer.

Questions you may have..

An employer must provide a minimum entitlement redundancy payment to an employee under the Redundancy Payments Act 1967 – 2014, but only when the employee has completed the statutory period of 2 years’ service with the employer and met the eligibility rules. The employer must also provide the employee with a minimum 2 weeks’ notice prior to dismissal. This notice period increases depending on the number of years’ service the employee has worked.

The eligibility rules state that the employee must be over 16, in insurable employment under the Social Welfare Acts, and have been in employment for at least 2 years.

The minimum statutory lump sum payment entitlement is Two weeks’ pay for every year of service and one further week’s pay subject to a maximum earnings limit of €600 per week.

It is important to note that you may reach an agreement with your employer to receive a redundancy payment above the statutory minimum sum and even in circumstances where the employee has worked less than the 2 year minimum requirement.

Using Our Services

How We Work

As one of Ireland’s leading financial planning firms based in south Dublin, there’s very little we haven’t encountered to help our clients prepare for. Our experience, technical knowledge and willingness to see things from your perspective means that whatever you have in mind for you and your family’s future we can help you plan the best way to get there.

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We look for more than the financial facts and need to understand what shapes your goals and aspirations and how you want to live your future life.
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Fees

We are a fee based financial planning firm. This means that we can focus on delivering the best advice for our clients needs and aren’t compromised by ties to financial product providers such as investment companies and pension providers.
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Need Financial Advice On Dealing With Redundancy?

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