SINGAPORE – When Sunena Sharma was retrenched a few years ago, all she could think about was whether she had enough cash and savings to tide her family through several months.
“My role in a technology company was made redundant following a restructuring exercise. It was an emotional roller-coaster phase,” said the 47-year-old.
Her experience reflects a wider conversation about what employees can do to strengthen their finances while still being employed and how best to navigate the stresses of losing one’s income.
For workers who have gone through retrenchment, receiving timely support within the first few hours after losing their jobs is key. This includes checking immediately how long one’s savings can last and exploring ways to earn a temporary income.
Workers can now pick up a financial tip or two from the second edition of Navigating Retrenchment, a guide by NTUC PME and financial advisory firm MoneyOwl that focuses on equipping employees with financial preparedness.
NTUC PME aims to provide targeted support for professionals, managers and executives.
Director of NTUC PME Wendy Tan said they saw the need to come together to develop a playbook that helps workers build their financial resilience.
“When someone is retrenched, they don’t just worry about their next employment, they may also struggle with the psychological consequences as well as face financial pressures,” she said.
Preparing ahead
Employees can proactively build an emergency fund while still being employed to strengthen their finances and ease the transition, said writers in the playbook. “Every dollar you set aside gives you room to breathe. Even if retrenchment never comes, you build lasting, better habits.”
The guide recommends setting aside six to nine months of essential expenses in cash or liquid savings, and trimming discretionary spending like dining out, entertainment and travel early.
It is also recommended to preserve cash and prioritise cash flow over cost savings, where necessary. This means spreading out expenses such as paying mortgage from the CPF Ordinary Account instead of cash, and converting annual subscriptions and renewals to monthly.
Employees should also avoid risky investments and review their insurance policies to check for overpayment and under-coverage. Consider adding low-cost term life or critical illness insurance first to maintain coverage, even if it means dropping some expensive policies.
The first 48 hours of retrenchment
When retrenchment is announced, it is important to secure a formal termination letter before checking every component of the compensation settlement, such as retrenchment benefit, notice pay, and annual leave and bonuses.
“Do not sign any agreement before reviewing it carefully,” said experts in the playbook.
Retrenched employees who are NTUC members can contact the labour movement or their respective unions to negotiate and secure a retrenchment package. Non-members can approach the Tripartite Alliance for Dispute Management for mediation.
When Sunena was retrenched, she failed to negotiate for retrenchment benefit with the company, before approaching NTUC for support.
“I was advised on how to position my contributions, circumstances and expectations professionally and firmly. I was able to negotiate an improved separation package that included additional ex-gratia payment and a prorated bonus.”
After receiving the payout, preserve it and keep it liquid in savings, fixed deposits or Singapore Savings Bonds.
Stretching your dollar post-retrenchment
Can you ensure that your emergency fund can last until you find a new job? Including the payout, how many months of expenses does it cover?
The playbook recommends comparing liquid assets against monthly expenses first, and start by listing them out, including cash, fixed deposits, T-bills and Singapore Savings Bonds. The aim is to have between six and nine months of savings.
Employees can reduce their monthly expenses by lowering grocery bills, reducing utility costs and cooking at home more frequently instead of dining out. They, too, can consider whether larger household expenses like a car or domestic helper remains essential.
Another tip is putting a pause on recurring savings investment plans to free up cash flow, which is usually penalty-free.
There are generally a few traps to avoid, such as committing to new savings plans, trying to make quick cash through gambling, crypto or risky stocks, and job offer scams that ask for upfront payment.
“Trying to make a quick buck out of panic almost always backfires and can wipe out savings in days,” noted writers in the playbook.
Tapping available support and schemes
Employees can tap available retrenchment resources including government schemes and community support to bridge the gap while actively finding a new job.
The SkillsFuture Jobseeker Support scheme allows eligible employees who lost their jobs involuntarily to secure temporary payouts of up to $6,000 over six months. As part of another scheme, Singaporeans aged 40 and above can receive up to $3,000 in monthly training allowance for selected full-time courses, up to a cap of $72,000 per worker.
There are community groups such as ComCare that provide grants for lower-income retrenched households.
For assistance with housing loans, it is worth noting that the Homeowner Job Support pilot can defer or reduce instalments and suspend interest for up to 12 months if the home owners are unemployed and working with a career coach.
Retrenched workers can also ask their banks about refinancing to lower their monthly commitment.
Another recommendation is to explore earning a temporary income such as renting out a room, or considering side hustles or part-time work that keep professional skills sharp.
For more details about the playbook, go to https://www.ntuc.org.sg/pme/advisory-and-protection/workplace-advisory
The first edition was launched by the labour movement in 2025 and offered guidance such as signs to look out for when a retrenchment is impending as well as steps to take after receiving a retrenchment notification.
