Near Retirement and Recently Laid Off? What Steps Can You Take To Protect Your Savings and Financial Future

Core Insights - The article emphasizes the importance of taking a step back and assessing one's financial situation after a layoff, particularly for those nearing retirement [2][3] - It highlights strategies to optimize cash flow and avoid costly mistakes, such as withdrawing from retirement accounts or claiming Social Security early [4][6] Financial Assessment - After a layoff, individuals should evaluate their entire financial profile, including savings, expenses, severance packages, and unemployment benefits [3] - The goal is to manage cash flow effectively before tapping into long-term savings, potentially through part-time work or consulting [3] Avoiding Mistakes - Withdrawing from retirement accounts like a 401(k) before age 59½ can incur taxes and penalties, and it also jeopardizes future compound growth [4] - Claiming Social Security benefits early at age 62 results in reduced monthly benefits, while delaying until full retirement age (67 for those born in 1960 and later) can increase benefits by 8% for each year delayed, up to age 70 [5]