Q: I'm 56 years old. Six months ago, I was laid off from the corporation that's employed me for 17 years, and I've yet to find another job. Although I have a master's degree, my lengthy employment with one organization left me with very specialized skills, which has hampered my ability to jump into a new field. I believe my age is another reason I haven't been hired. I'm not ready for retirement and had planned on devoting myself to my career until at least age 65, but I'm nervous about my prospects. Should I be working part-time jobs to maintain the status quo financially?
A: I know this is a tough time, but your first job is to change your mind-set. Nothing is hampering your ability to jump into a new field but you. You can market your skills more broadly or, as I explain in Hire Learning, maybe you need to take some new classes that will expand your base of knowledge. You can do it; it's a matter of convincing yourself.
I want you to get back to work as fast as possible, even if it's part-time. Make sure you don't dig yourself into a deeper hole by spending money today that you will need tomorrow; the biggest mistake I see people make when they're downsized is tucking into their savings. The next step is to adjust your expectations. If you have been out of work for six months, you already know that positions similar to the one you had may be unattainable. Stop knocking on closed doors and try the ones that are open. Any job that can earn you income is a job to consider.
Just as important is a job that offers health insurance. If your former company's medical plan is covered by the federal Employee Retirement Income Security Act (check with human resources), you will be able to stay enrolled for up to 18 months; you'll likely be responsible for paying the premiums, plus a 2 percent administrative fee. And before those 18 months are up, you need to think about how you will stay insured going forward. It can be expensive to purchase your own policy. Though you may feel overqualified or underpaid, taking a job with medical benefits could be the best interim decision.
Once you return to work full-time, try to increase your savings. Because you're over 50, you can invest $6,000 a year in an IRA account (for anyone younger, it's $5,000). If you're lucky enough to land a job that offers a 401(k), you will also be allowed to make an extra annual "catch-up" contribution of $5,000. That means instead of the regular $15,500 annual maximum contribution, you can put away up to $20,500—a great way to make up for lost time.