It can be hard to see things clearly when you’re going through a personal loss or adversity. Having a financial plan can give you a fresh perspective.
When life throws you a career curve ball, evaluate your finances and create a strategy. A financial planner can help.
If you’ve lost your regular source of income, look at what else is coming in—such as your spouse’s income, investment income, Employment Insurance (EI) benefits or severance payments.
Tip for Your Severance Payment
Even if you need some of the funds to cover short-term expenses, consider transferring your severance payment to your RRSP to avoid withholding tax. You can invest in a short-term strategy so you can withdraw what you need when you need it.
Itemize your day-to-day expenses and take a look at what might be changing. Can you cut back on transportation costs, weekday meals out, clothing costs and dry cleaning?
Develop a budget that runs several months into the future to account for payments or expenses that don’t occur every month, such as quarterly property tax payments, an income tax refund, or a future bonus or commission payment.
A financial planner can show you ways to consolidate debt to free up cash flow, or adjust your mortgage amortization to reduce monthly payments.Contact an RBC Financial Planner
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