Money Monday: Tips for Ford retirees - Dallas News | myFOXdfw.com

Money Monday: Tips for Ford retirees

Posted: Updated:
SOUTHFIELD, Mich. (WJBK) -

Ford retirees have maximize time to determine lump sum or monthly payment.

John Schindler, Sr. VP at UBS Financial Services, says Ford is being more strategic than GM letting folks know ahead of their offers to sufficiently plan accordingly. (GM announced it and offers were in the mail that day). As a result, there are certain things that these Ford retirees SHOULD be doing now prior to getting their actual offer. From there, they will have 90-days to determine their option.

Schinder's father retired after working for Ford for over 35 years. Less than 3 years after he retired, he unexpectedly passed away. Because of this, he has stepped up to offer free education to these retirees—so they don't have to endure what his family experienced. He is doing free webinars AND creating plans for folks with no charge to provide education to the community. Online: www.fordwebinar.com

John, What is the difference between Ford vs. GM's approach to this lump sum or pension options?

  • Ford is being much more strategic in allowing their retirees to have more time
  • GM announced the offer and they were in the mail that day—leaving a short 7 weeks total for retirees to decide a life-changing decision
  • The first wave of Ford offers will arrive August 15 and retirees will have until Nov. 15 to decide
  • The ongoing offer schedule based on Social Security #'s and will be going on for the next year

What are the things these Ford retirees need to be doing now?

  • First and foremost, schedule a physical now—Health conditions are a big part of determining the best option for you
  • Gather all Social Security and other savings/investment information
  • Review your monthly budget and all expenses vs. wants
  • Start asking professionals now about your "financial blind spots" -- what are you not seeing based on this information?

 And what are the considerations folks should consider when they actually receive this offer?

  • If you have had a change in your marital status--Widowers, individuals who divorced after taking their pension have different financial requirements due to the change in their marital status.  
  • If you saved diligently or have income flexibility — If you are paying taxes on income you don't require each month or if you have income flexibility in retirement (i.e. You plan to use more money at 65 to travel and reduce monthly income later in life).  
  • If you want to pass on money to your family—When you pass away, your pension also goes away.  
  • If you are worried about inflation—Current pensions do not account for inflation.  
  • If you have special needs children—The lump sum offers the opportunity to create a trust for special needs children or grandchildren.  

Other tips?

  • This is far from a one-size-fits all decision—every situation is different.  
  • This can be overwhelming! Get help—don't rely on pre-conceived notions about what you think is right.  
  • Evaluate this as a business decision—remove emotion and build your offer into an existing financial plan.
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