Special: Attn Ford Employees ; Think hard before you accept a buyout

The editors at TACH feel that this is such an important subject which can affect so many Ford employees that it imoportanbt for all those affected to have an opportunity to see this insightfull article, you can reach the author at her e mail address below.

Detroit September 15, 2006; Susan Tompor writing for the Detroit Free Press reported that thousands of UAW workers at Ford Motor Co. woke up today wondering whether they should grab the money and go.

Do they opt for one of several complicated buyout and early retirement offers? Or do they stick around at Ford?

Before they make a move, they should get a game plan.

Here are some thoughts on how to avoid buyout remorse:

• Put on a pot of coffee and put together a study group.

If you're at a company with a bunch of buyout offers, like Ford, why not join forces with friends to research every detail of the offer?

"The wisdom of the group may make you feel better about making the decision," said Jim Badge, president of DFCU Financial Partners, a division of DFCU Financial Federal Credit Union in Dearborn.

• Treat any buyout payout as real money -- not play money.

If you take a buyout, you're ultimately giving up that ever-dependable paycheck.

So anyone taking a buyout or early retirement package shouldn't throw lump sums into fast-money schemes.

• Don't park a buyout check in a checking account.

It's too tempting to spend it. Start shopping around for the best rates on certificates of deposit.

• Get ready to downsize.

Some families are living on two incomes -- plus their overtime. If somebody takes a buyout, they cannot keep spending like that for long. That's true even if they dip into savings, tap into any pension and get money from a new job. So they're going to have to cut back significantly.

"Are you ready to do that?" asked David Kudla, chief executive officer and chief investment strategist for Mainstay Capital Management in Grand Blanc.

• If you're going to invest that money, take time to meet with different brokers or financial planners. See www.sec.gov for investor information. Look for investor tips on "Lump-Sum Payouts."

• Get a real handle on how much a $35,000 or $140,000 buyout is worth -- after taxes.

• Review your mortgage.

If you have an adjustable-rate mortgage, talk to your lender to see how much your payments could go up.

• Find out how much it would cost to replace your health care coverage, if you pick an option where you could lose medical benefits.

One option: The Special Termination of Employment lets eligible UAW Ford workers get a lump-sum payment of $100,000, minus applicable taxes. You'd keep basic medical benefits, minus dental and vision, for six months. But after six months, workers could continue health insurance under their own expense through COBRA.

• If you're in your 40s, think about how long it might take to find another job. If you're in your 50s, ask yourself if you're mentally prepared to retire -- or take a lower-paying part-time job.

"This really comes down to personal life decisions for folks," said Brian Edkin, vice president and branch manager for Charles Schwab & Co. in Southfield.

No one but you can answer the toughest question of all: Should I stay or should I go?

Give yourself plenty of time to look for an answer.

Contact SUSAN TOMPOR at 313-222-8876 or stompor@freepress.com.