How to prepare financially for a layoff in your 50s

1064. What should you do with your retirement contributions when a layoff looms in your mid-50s? Host Laura Adams tackles a listener’s question about building a cash cushion without sacrificing growth for retirement. Whether you're navigating late-career volatility or job insecurity as a younger worker, these tips will help protect your financial future.

Key Takeaways

• Even with a looming layoff, try to contribute at least enough to capture your full employer match to a retirement account, giving you a guaranteed 100% return.
• For emergency funds you may need within the next year, prioritize savings in an FDIC-insured high-yield savings account.
• Leaving your job in or after the calendar year you reach age 55 waives the 10% early withdrawal penalty on your current employer's retirement plan.
• Distributions from traditional retirement accounts remain subject to ordinary income tax no matter your age.
• While the rule of 55 eliminates the 10% penalty, you must have owned a Roth plan for at least five years for the pre-tax earnings to be tax-free.
• Sole earners supporting family members should have at least six months of essential living expenses saved as a cash reserve.
• Older job seekers should modernize resumes by trimming them to the last 10 to 15 years of experience, removing graduation dates, highlighting quantifiable business results, and showcasing proficiency in enterprise platforms, popular tools, and AI workflows.

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