What to do after redundancy

Job loss can be tough – emotionally, professionally, and financially. For many New Zealanders, particularly in Wellington’s public sector, redundancy announcements over the last 12 months have made that reality hit home.

As financial advisers, we understand how job loss can throw your financial plans off course, affecting everything from your day-to-day cash flow to progress toward long-term goals like home ownership or retiring early. But smart financial decisions early on can ease the pressure and set you up for a strong recovery.

If you’ve been made redundant or laid off, or you’re supporting someone through the same, here are five practical steps to help you get your finances back on track.

 

1. Assess your financial situation and the options available

Before making any big decisions, pause and assess. Getting a clear picture of where you are financially will help reduce uncertainty and put you in control.

Key things to check include:

– Redundancy payouts and other benefits: Are you entitled to redundancy compensation? Do you have annual leave owing? Do you have any bonus or shares vesting?

– Personal insurance: If you have income protection or mortgage protection insurance, review your policies to see if you’re eligible to claim. Some policies cover involuntary job loss or can cover mortgage repayments during unemployment.

– Savings: How much do you have readily available in savings?

– Monthly outgoings: What are your fixed expenses e.g. mortgage or rent, bills, insurance, groceries, etc?

– Mortgage relief: NZ banks offer support if you’re struggling to make mortgage repayments. This is a good time to check the options available, whether it’s reducing repayment amounts, switching to interest only, or choosing to defer repayments temporarily (a mortgage holiday).

– Debt obligations: Do you have loan or credit card repayments due soon?

– Government support: Are you eligible for Jobseeker Support?

If you’ve been made redundant, we recommend putting together a simple cashflow forecast for the next 3-6 months. This will help you understand how far your funds can stretch and whether you need to consider options like a mortgage holiday or apply for government support.

If taking stock feels overwhelming right now, a financial adviser can help you focus on what matters most. At Blue Canoe, we combine financial expertise with smart cashflow modelling tools, creating clear, graph-based snapshots of your finances. This helps you make confident, evidence-based decisions for the short-term and long-term.

 

2. Create a short-term financial bridging plan

This step is about building a financial bridge between now and your next income. This will help you get through the next 3–6 months without putting your long-term finances (or your health and wellbeing) under unnecessary stress.

Some of the strategies in your bridging plan might include:

– Cutting discretionary spending: Reducing non-essentials like those streaming subscriptions, daily coffees, takeaways, and big purchases.

– Trimming bills: Unlocking savings by comparing power, phone, internet, and general insurance providers.

– Exploring interim income earners: Short-term contracts or temp work might help cover costs while you job hunt.

– Delay big financial decisions: If you were about to upgrade your car or renovate, now might be a good time to press pause.

For more practical tips on budgeting, financial planning, and managing your money, explore our other blog posts — they’re full of helpful advice to guide you through.

 

3. Review your KiwiSaver strategy

Losing your job affects more than just your income. It also pauses your KiwiSaver contributions. Without a salary, both your employee and employer contributions stop, which can slow down your retirement savings.

If you can afford it, making voluntary KiwiSaver contributions is a smart move – even small amounts make a difference. Contributing just $20 a week helps keep your retirement savings on track and may qualify you for the Government top-up each year (1 July to 30 June).

If you’d prefer to take a short break from contributing, you can choose to take a savings suspension for 3-months to 1-year, provided you’ve been a KiwiSaver member for a year or more.

This can also be a good time to check whether your current fund still fits your situation. If retirement is a long way off, you might be comfortable staying in a growth fund. If you’re feeling more cautious, a more conservative fund could make sense. Before switching, talk to a financial adviser. It’s easy to make reactive decisions during uncertain times, but a professional can help you align your KiwiSaver strategy with your goals.

In most cases, you can only access your KiwiSaver once you turn 65. However, if you’re facing serious financial difficulties and have exhausted all other options, you may be able to apply for a financial hardship withdrawal. This is a major decision with long-term consequences, so it’s best to seek advice before taking this step.

 

4. Review your personal insurance cover

Personal insurance can be crucial when the unexpected happens, but it’s often one of the first things people cut when money gets tight. Before cancelling cover, it’s important to understand exactly what you have in place.

As mentioned earlier, if you have income protection or mortgage protection insurance, check whether you’re eligible to claim. Some policies include cover for involuntary job loss or can help with mortgage repayments while you’re between roles. 

Other policies, like life, trauma, or health insurance, are also worth reviewing. Ask yourself: Are the premiums still manageable? Does the level of cover still suit your needs? 

Rather than cancelling cover altogether, check whether you can temporarily pause your premiums. In some cases, you may be able to put your premiums on hold. While you wouldn’t be able to claim during this time, the policy can often be reinstated within 12 months, without the need to provide medical evidence again.

There may also be ways to reduce your premium without losing your cover altogether. For example, extending the wait period on your income or mortgage protection policy can lower the cost. Or increasing the excess on your health insurance could reduce your premiums while keeping the important long-term benefits in place.

If you’re not currently insured, now may be a good time to explore your options. Losing your job highlights how quickly financial circumstances can change, and personal insurance offers a layer of protection for whatever comes next.

 

5. Refocus your financial goals

Losing your job can feel like a financial and emotional setback. But it can also be a valuable opportunity to pause and reconsider what matters most in your life and how your finances support those priorities.

Redundancy often brings big questions to the surface, like:

– Do your long-term financial goals (e.g. home ownership, retiring early, or travel) still align with your lifestyle and personal values?

– Is this a chance to re-train, start something new, or transition from the public to the private sector?

– Do you want to shift to more flexible work or reimagine your work-life balance?

These decisions come with real financial implications. Revisiting your goals with a financial adviser can give you clarity on how a change in income, career or lifestyle will affect your future. It’s not just about adjusting numbers on a spreadsheet, it’s about aligning your money with the life you want to build next.

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Job loss isn’t easy, but it can be a chance to reset and realign your next steps with purpose. With the right advice, you can move forward with clarity and confidence.

At Blue Canoe, we can help you make sense of uncertainty. Our financial advisers offer straightforward, personalised guidance. Whether you’re dealing with redundancy or planning for what’s next, we’ll help you take control, refocus your goals, and build a clear path forward.

 

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