30 September, 2019 Financial Planning

Planner’s Corner: Career Reboot


I appreciate the opportunity and privilege of helping clients during times of transition such as buying a first home, retirement or sadly, the passing away of a family member. Another transitional time includes making a career change due to discovery of a new area a client feels passionate about or because they hit roadblocks such as a lack of advancement, cutbacks or layoffs. Statistics indicates that three out of four Canadians have switched career directions at some point. Personally, during my now 30 years in the financial services industry, I’ve experienced two major, directionally changing events including the opening of Lighthouse Financial & IPC Investment Corporation in August 2016.

What can you do to prepare for an almost inevitable career transition?

  • Continue learning by deepening transferable skills and acquiring new ones. Take ownership of your future. Working for a big bank early in my career, I assumed my employer would “take care of me”. When a layoff occurred, my delay in obtaining a Certified Financial Planner® designation made me less attractive to potential employers.

  • Workplace and government funding. Take advantage of employer-sponsored programs such as computer and sales training. If you are considering heading in a new direction, the provincial and federal governments have a myriad of grants and loans such as Skills Boost and Employment Insurance.
  • Prepare. With stronger finances, you’ll have more flexibility to make career decisions. Have and regularly contribute to an emergency fund ideally within a Tax Free Savings Account, by trimming expenses so there’s money left at the end of each month. Pay down debt and if warranted, set up a line of credit while you are still employed. If you need to go back to school to pick up a diploma or degree, you can borrow up to $20,000 from you or your spouse’s Registered Retirement Fund (RRSP) via the Lifelong Learning Plan if you enroll in a full-time program at most post-secondary institution.
  • Research alternatives to your employer benefit plans. Changing careers may mean the elimination of your health benefits. You may want to consider a supplemental health and dental plan to help cover expenses like prescription drug costs and dental check-ups. After employment termination, most employer-sponsored plans allow 30-days of guaranteed acceptance with no medical questions in order to carry forward some or all of your health, dental and life insurance benefits.

  • Maintain and develop your network. If looking for work, finding employment references outside of your previous employer can be a challenge. While employed, keep up your contacts in your current industry and outside your industry. Try not to ‘burn bridges’ with previous employers and coworkers. With social media like Facebook and LinkedIn, it’s a lot easier to keep up with friends and acquaintances.
  • Keep your advisor informed. Your advisor can help you with the myriad of financial decisions that come with a transition. If you received a severance package, your advisor can help you make the most of it by balancing today’s needs with long-term investing. Your advisor can also help you with your group RRSP and/or share purchase plan. During a transition, it’s advisable to review your current asset allocation. You may need to access your long-term investments to bridge gaps between jobs, finance retraining or invest in a new business. You may need to put a temporary hold on your monthly contributions. A change in career may adjust your retirement plans such as timing and funds available.

If you or someone you know is experiencing a career or life transition, please let them know of the services provided by Lighthouse Financial & IPC Investment Corporation.

Jim Hummel, CFP®, CKA®