Financial Advice After Redundancy
Redundancy is unsettling — but with the right financial planning, it can also be a moment to reset and rebuild on stronger ground.
Your Situation
If you have recently been made redundant and want to ensure your financial decisions are the right ones…
Redundancy arrives with financial and emotional pressure in equal measure. Decisions made quickly under that pressure — about redundancy pay, pension options, investments — can be difficult to reverse. The first thing to understand is that you almost certainly have more time and more options than it feels like in the immediate aftermath. Your redundancy payment, your pension, and your savings are not crises to be resolved urgently: they are assets to be managed thoughtfully.
Castle Stonebridge provides independent financial advice to individuals across the UK who are navigating redundancy. We help you understand the tax position on your redundancy payment, review your pension options, assess your cashflow through any period of unemployment, and plan the next phase of your financial life — whether that means returning to work, retraining, consulting, or retiring earlier than planned.
Questions We Answer
"How much of my redundancy payment is tax-free?"
The first £30,000 of a genuine redundancy payment is free of income tax and National Insurance — understanding this shapes how you structure the payment.
"What should I do with my pension from my old employer?"
Leaving a pension with a former employer, consolidating it, or deferring it all have different implications for charges, investment, and future income.
"How long can I fund my lifestyle from my current savings and redundancy pay?"
A clear cashflow projection removes anxiety and helps you make rational decisions rather than panicked ones.
"Should I pause pension contributions if I am not working?"
Without employment income, your pension contribution strategy needs to change — understanding the options preserves as much tax efficiency as possible.
"Could redundancy actually accelerate my retirement plans?"
For those with significant pension and savings, redundancy can be the moment to reassess whether continued employment is genuinely necessary.
Our Approach
How We Guide You
Financial position review
We review your complete financial position — redundancy payment, savings, pension, mortgage, and outgoings — to establish a clear picture.
Tax and redundancy payment advice
We advise on the tax treatment of your redundancy payment, including any pension contribution strategy to utilise unused annual allowance.
Cashflow and bridge planning
We build a cashflow plan for the period of unemployment, establishing how long your resources will support your lifestyle.
Next-phase financial plan
We design a financial plan for the next phase of your life — whether employment, consultancy, semi-retirement, or full retirement.
Key Considerations
What you should know before making a decision
- The first £30,000 of a genuine redundancy payment is free of income tax and National Insurance. Amounts above £30,000 are subject to income tax at your marginal rate. Statutory redundancy pay counts towards the £30,000 limit.
- Contributing some or all of the redundancy payment into a pension can be a tax-efficient strategy — particularly for higher-rate taxpayers — as it benefits from tax relief and does not count as employment income in the calculation of the £30,000 limit.
- In a period of unemployment, you can still contribute up to £3,600 gross per year to a personal pension (£2,880 net of basic rate tax relief) without employment income. This preserves pension savings momentum.
- Benefits entitlements (such as National Insurance credits) during unemployment should be checked — gaps in NI record can affect future State Pension entitlement and should be addressed.
Talk to an independent adviser — no obligation
Castle Stonebridge is FCA-regulated and wholly independent. We are not tied to any provider, which means our advice is guided solely by what is right for you.
Book a Free ConsultationYour initial consultation is completely free and carries no obligation.
Common Questions
Frequently Asked Questions
Ready to get the right advice for your situation?
Your free initial consultation is completely without obligation. We will listen, understand your specific circumstances, and tell you honestly whether and how we can help — before we discuss fees.
advice@castlestonebridge.co.ukCastle Stonebridge Limited is an Appointed Representative of Rosemount Financial Solutions (IFA) Limited, which is authorised and regulated by the Financial Conduct Authority. Rosemount Financial Solutions (IFA) Limited is entered on the Financial Services Register under reference 535515. Tax treatment depends on individual circumstances and may change.
Investment & Pensions Risk: Capital is at risk. The value of pensions and investments and the income they produce can fall as well as rise. You may get back less than you invested. Past performance is not a reliable indicator of future results.