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The scenario runs something like this: The bean counters warn upper management that the quarterly report doesn't look good.

"Earnings are down and we've got a one-time charge for buying that subsidiary earlier this year. We've got to cut costs," they might say.After careful analysis, management trims the work force, laying off hundreds of workers. The scenario has been played out in Utah several times during the past few months, most recently at WordPerfect, which will lay off about 600 people locally.

When the pink slips come, so do myriad personal finance decisions.

"Number one, don't panic," says certified financial planner Roger Smedley, owner of Smedley Financial Services Inc.

"Number two, slow down. You want to make all of the decisions you're going to make based on fact, not emotion, although almost everyone does it the other way around."

Statistics show that 80 percent of workers who leave a company with-draw their retirement fund, pay the 10 percent penalty, taxes and spend it.

"When people spend what they have accumulated for retirement, they are just eating the seed corn that provides for their golden years. Spending their retirement savings is the worst possible thing anyone can do," said financial author Bruce Lefavi, chief executive officer of the Lefavi Financial Center and Certified Financial Planner.

Instead, displaced workers should immediately reinvest or redeposit the money in a retirement plan, which will accrue the benefit of compounded interest.

Lefavi, author of "Bulletproofing Your Financial Future," is offering complimentary investment advice through September to affected Novell employees. "I know it is tough to be in a tight financial situation. It will be even tougher when retirement age looms closely for some of these people who spent their hard-earned retirement early," he said.

Paying the penalties and taxes on a $10,000 retirement fund will leave the worker about $5,400 to spend.

Like Lefavi, Smedley suggests immediately rolling over any retirement money accrued on a job into another investment vehicle. While some people treat the money as a windfall, financial advisers say the benefits of compounded interest will pay off big at retirement.

If a worker invests $10,000 in a mutual fund at age 40, the investment could be worth as much as $100,000 upon retirement 25 years later.

If a worker is strapped for cash on the short term, Smedley suggests borrowing it instead of dipping into the retirement fund.

"If you can borrow anywhere else in your life for less than 45 percent interest, it's probably worth your while," Smedley said.

A more immediate concern for displaced workers is finding a new job.

Take heart, Utahns, Smedley said: "The bad news is you've lost a job. The good news is, you're in the number one economy in the nation."

Lecia Parks Langston, chief economist for the Utah Department of Employment Security, said new job prospects vary by profession.

The jobs exist in number, but newly displaced workers may not be able to match their existing salaries and benefits. "But given our job growth and the fact they're in commuter distance of Salt Lake City, they stand a better chance of being reabsorbed fairly quickly," Langston said.

To help their prospects, Langston suggests taking advantage of employee outplacement programs and workshops offered by Job Service to improve job-seeking skills.

"Just knowing what to put on a resume could make a big difference," she said.