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What To Do With My Severance?

What To Do with My Severance?

Several of my clients work at the federal government which is offering a one time lump sum offer to replace the retiring lump sum when they retire. The money can roll into an RRSP (if you have the contribution room) and therefore avoid taxes until the money is withdrawn in the future. Severance packagesOr you can take the money out and receive a portion after taxes are withdrawn. What is best to do?  Every situation depends on several factors.

  • What are your goals, both short and long term?
  • Do you have any debts?  Are they loans or lines of credit?
  • Is there something special you could do with the money?
  • Could the money be used to make a difference to your cash flow for the future?
  • How close am I to retirement?

Each situation is unique and there can be several ways to use the money.  Spending time considering the options may get you the best results.  If you need a sounding board, I’m happy to help.

Photo copyright: photokanok / 123RF Stock Photo

This article was prepared solely by Laura Chanin who is a registered representative of HollisWealthTM (a division of Scotia Capital Inc., a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada). The views and opinions, including any recommendations, expressed in this article are those of Laura Chanin alone and not those of HollisWealth. TM Trademark of The Bank of Nova Scotia, used under license.