Redundancy: the money questions to ask before you leave

A redundancy payment can look reassuring on paper while the months ahead still feel uncertain. The number matters, but so do the dates: when your salary stops, when the payment arrives and when you might earn again.

If you are also thinking about a career change, caring responsibilities or a slower pace of work, there may be several decisions tangled together. Giving each one its own space can make the next step more manageable.

Ask for the payment breakdown

Before building a plan around a headline figure, ask payroll to separate your final salary, notice arrangements, unused annual leave, statutory redundancy and any additional payment. Ask for the expected net amount and the payment date, with an explanation of any tax deducted.

Revenue confirms that qualifying statutory redundancy is exempt from Income Tax and USC. Additional termination payments are subject to separate rules and reliefs, so the whole package should not automatically be treated as tax-free. [1] [2]

If you are being asked to sign a settlement agreement, understand its conditions and deadlines before signing. Individual legal and tax advice may be needed; a coaching conversation does not replace either.

Work out what the household will need each month

Write down the essential outgoings that will continue: housing, food, utilities, transport, insurance, debt repayments and caring costs. Include a monthly allowance for annual bills. Then set out the income you can reasonably count on after employment ends.

An illustrative example: if the household needs €3,200 a month and other reliable net income is €1,800, the gap is €1,400. A separate €14,000 pot would cover ten months at that gap, before unexpected costs. That is a planning illustration, not a prediction of how long someone should take off.

Use confirmed figures where possible. Keep any uncertain future earnings or support payments separate until you understand whether they will be available. Try a slower return-to-work scenario as well as the one you hope for.

Give your pension its own conversation

Leaving a job raises a separate set of pension questions. Depending on the arrangement and your circumstances, options may include retaining benefits in the existing scheme or transferring them. The Pensions Authority explains these choices and the conditions that apply. [3]

Ask the administrator for your leaving-service options, an up-to-date statement and details of any deadlines, charges or guarantees. Make sure they have your personal email address. A transfer is a decision to assess, not an automatic part of leaving employment.

Check the benefits that leave with the job

Ask HR for the exact end dates of any employer-paid health insurance, life cover and income protection. Check whether you have continuation options and what they cost. Keep copies of documents you will need after access to the work systems ends.

It can help to put three dates on one page: final salary, expected leaving payment and the end of important benefits. An employer's offer of a financial education session can be particularly useful at this point, provided there is time to ask questions and no product-sales agenda.

Make the next decision smaller

You do not have to choose your next career, reorganise every pension and decide what to do with the whole payment in one sitting. Start by establishing the amount available, the monthly gap and the decisions with real deadlines. That gives a later conversation about savings, debt or retirement something solid to work from.

For a practical starting point, use the Irish Money Check-Up to gather your figures before you speak with an adviser or coach.

Money, Just For Her provides financial education and coaching. This article is general information, not a personal recommendation or regulated financial, tax or legal advice. Where a decision needs specialist advice, choose an appropriately qualified or regulated professional.