The closer we get to the grand rollout of the Ford lump-sum pension offer, the more obvious it is that Ford salaried retirees cannot simply copy what their brother, sister or best friend from Ford decides to do.
Agree to grab a lump sum? Or just stick with the usual monthly pension check?
Beginning in July, Ford's current active salaried employees will get a choice of taking a lump-sum payment or a regular pension check. This new option applies to Ford salaried workers who retire on or after July 1.
About 65,000 salaried Ford retirees and surviving spouses will be facing the choice during different time slots in 2012 and 2013.
Plus, another 35,000 former Ford workers who left the company before retirement but are due a pension will get a postcard to alert them of their time to make a choice, too.
Some speculate that the first random group could be getting paperwork as soon as July. Ford has said the rollout would begin sometime this summer.
The detailed offer is to arrive a month before the election period, and retirees would have 90 days to make their decision once the election period begins.
According to a letter that alerted retirees of the new program, Ford said that under no circumstances will eligible retirees and their beneficiaries be able to change assigned election periods.
In other words, watch your mailbox.
Retiree groups and Ford families are abuzz with speculation.
"I'm running into lots of folks thinking, 'If Ford's doing this, it can't be good,' " said Leon C. LaBrecque, CEO of LJPR, a fee-only financial adviser in Troy.
One Ford retiree told me by email that he'd never take this deal.
"I have absolutely no intention of taking a one-time, up-front payment," the retiree initially wrote.
"Of course, if my doctor told me I have 90 days to live, that would be different and at 80 years, it's something to consider."
In a later email, the retiree said the more he hears, the more he could be open-minded.
Remember, this is an option -- no one is being forced to take a lump sum instead of a monthly pension check here.
Today, a lot of the Ford lump-sum deal is a speculation game.
How big would the lump sum end up? Ford isn't saying.
LaBrecque said he has seen one lump-sum offer for an active Ford employee who is going to retire this summer. The salaried employee is 56, had a salary at the $100,000 level and had 36 years at Ford.
That active employee was looking at a lump sum of $700,000.
But that person is 56.
The lump sums would be smaller for older retirees. LaBrecque estimated that the lump sum could be again this is pure speculation about $585,000 for a similar lower-level manager who is already retired and is 66 years old.
He estimated that the lump sum might drop to $423,000 if that similar retiree is 76.
For some, taking $700,000 or more is a godsend. For others, amazingly, it's not a bright idea.
LaBrecque said he recommended that his 56-year-old Ford client take $3,700 a month instead of a $700,000 lump sum. She's a woman in great health, not married, no kids, and she doesn't want to leave money to anyone.
Yet the lump-sum deal might work for someone who has other money to live on, would like to invest that lump-sum money over time, isn't fearful of investing and wants to leave money as a legacy.
And, yes, it could work for someone who has a limited time to live. Again, very few situations would be the same.
For many Ford people, talking with their accountant is a good idea before making any moves.
Joseph DeGennaro, tax director for Doeren Mayhew in Troy, Mich., said a retiree would not want to have a lump-sum check sent to him or her. Instead, he said the lump sum should be rolled over directly to an investment firm for a retirement account.
If you receive the check itself as a lump-sum distribution, a qualified plan must withhold 20 percent. Problems can arise if you then wanted to make a full rollover because you would then need to come up with the 20 percent out of pocket to complete the rollover and avoid an immediate tax hit, said Barbara Weltman, contributing editor for J.K. Lasser's "Your Income Tax 2012."
Distributions from a regular Individual Retirement Account are taxable as ordinary income for federal purposes.
One more thought to consider: What's your spouse going to say on this deal?
A defined-benefit pension provides a lifetime of income, no matter how long you live, and includes survivor benefits for a spouse.
Yet if you're married, you would have to get your spouse to agree to the lump sum.
"If someone is married, and they wish to elect the lump-sum payment," Ford spokeswoman Marcey Evans said, "their spouse would have to sign a spousal waiver."