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 Your Questions Answered: Voluntary Lump-Sum Payment Opportunity Coming for Ford GRP Retirees and Surviving Beneficiaries

DATE: Will be calculated from "Release Start Date" field.

​DEARBORN - As the Company looks to de-risk its global funded pension plans and provide flexibility to participants in its U.S. pension plan, Ford announced that it will offer a one-time voluntary lump-sum pension payment to about 90,000 eligible U.S. retirees, former employees and surviving beneficiaries.

This voluntary opportunity allows salaried (primarily) retirees and surviving beneficiaries to receive the remaining value of their General Retirement Plan (GRP) benefit as a single lump-sum payment instead of monthly payments. Intended to be a one-time-only offer, this also may include additional monthly pension benefit payment options for those currently receiving pension payments. 

“We are proud to continue to provide excellent retirement benefits, as do other leading companies, and to even go further by providing this completely voluntary option for our retirees,” stated Rick Popp, director of Employee Benefits.

At this time, the lump-sum pension payment opportunity is only available under the GRP.1 Participants who are currently receiving a monthly payment from a merged plan (e.g., FERCO, Granite, PRIMUS, APMSI, Environ or AAI Salaried) also are included.2 This program is for salaried retirees and former salaried employees who worked at all salary levels at the Company, in addition to some hourly non-UAW retirees who are participants in the GRP.

Given the large number of eligible individuals, the Company’s desire to provide ample time for education and decision-making, and to ensure administrative efficiency of elections and payouts, a series of election periods will be held throughout the remainder of 2012 and continue into 2013. Eligible participants will be assigned a specific election period based on a random process.

The first election period will begin as early as August 2012.  Participants will be notified of their election period about a month prior to the beginning of the election period. Lump-sum payouts will start later this year and will be funded from existing pension plan assets.

The materials to be received leading up to the election periods will help retirees think through their decision. Once a participant is notified of the amount of the lump sum via the Election Kit, he or she will want to consider if taking the lump-sum payment option would fit with his or her retirement financial plan.  To help participants make an informed decision, Ford plans to provide access to financial and tax education through an independent financial services firm at no cost to the participant. All participants are encouraged to consult with their personal financial planner and/or tax advisor before making any decision.

Eligible participants can find more information on myfordbenefits.com.  Once you are logged on, a link to frequently asked questions can be found under Messages & Alerts from the homepage.

1Other Ford-sponsored pension plans are not included in this offer, i.e., UAW Retirement Plan, UAW Personal Retirement Plan. 

2Participants in these plans can expect to receive a separate Election Kit for this benefit.

Read the updated Q&A on this voluntary lump-sum pension payment opportunity located below.

Your employee benefits are governed by the terms of the applicable official plan document or policy. Summaries of your benefits are available; however, if a conflict exists between any summary and the official plan document, the official plan document prevails. The Company reserves the right to terminate, suspend, or amend any of its employee benefit plans, programs or policies at any time in accordance with applicable plan documents and subject to applicable collective bargaining agreements. You will be notified of any change after it is approved. Until a change is officially announced, no plan fiduciary or any other Company representative is authorized to disclose to you any information about a change under consideration. You should rely exclusively on officially announced information and plan materials. No employee, beneficiary, surviving spouse or other person has any legal or other right to benefits under the Company's employee benefit plans, programs or policies, except as provided by such plans, programs and policies.

Updated FAQ:
1. If I am currently enrolled in, or eligible for, Ford health insurance or other benefits, will these benefits be affected if I take the lump sum payout option?
No. Eligibility for other benefit programs like retiree health and life insurance, if applicable, are not impacted.

2.  What will happen to my automatic pension deductions if I elect the lump sum?
As a retiree or beneficiary, you may have expenses paid or other deductions made from your GRP monthly pension benefit payment. If you elect the lump sum payment opportunity, the automatic deduction feature will end and expenses or deductions must be self-paid going forward.

3. For participants who have dual plans (example GRP and UAW), will they be able to elect the lump sum from the GRP?
Yes. The lump sum payment option will apply to your GRP benefit only and any monthly pension plan payments you may be receiving from a Ford-sponsored plan other than the GRP are not affected and will remain unchanged.

4. When does the 90-day election period begin?  
You will receive a postcard confirming your 90-day election period approximately one month prior to it beginning. 

5. How can I confirm that Ford has my correct address?   
You can go online to myfordbenefits.com and click on Personal Information.  You can verify your address of record on this screen.  If you need to make a change, click on Update and make your changes.  You may also contact the NESC at 1-800-248-4444 and speak to a Personal Benefits Representative, if online service doesn’t work for you.

6. Who is eligible for this lump sum payment option?
Retirees who are presently in payment from the GRP are eligible, along with surviving beneficiaries receiving payments from the GRP. Participants who are currently receiving a monthly payment from a merged plan (e.g., FERCO, Granite, PRIMUS, APMSI, Environ or AAI Salaried) also are included. Employees who worked at all salary levels of the Company are included in the eligibility requirements of this program.

Note: Ford-sponsored pension plans other than the GRP are not included in this offer. 

7. Do I have to accept the lump sum payment option?
No. The lump sum payment option is completely voluntary. If you take no action, you will continue to receive your monthly pension benefit payments as you do now. 

8. Should I talk to a financial planner or tax advisor about this option?
Once you receive your Election Kit, you are encouraged to consult with a financial planner and/or tax advisor as soon as possible so you have time to discuss your personal situation and consider your options before making your election. Both federal and state taxes may apply to your payment.

9. Why is Ford offering the lump-sum payment option?
This lump sum pension payment option offers benefits for both the eligible GRP participant and Ford.  For the eligible participant, it allows the additional choice and flexibility in how they receive, invest and manage their GRP retirement funds.  For Ford, it allows the company to reduce financial volatility and administrative costs related to pensions.

10. If I am in one of the later election periods, is there any risk of Ford running out of money for lump-sum payments?
Ford has carefully evaluated and planned for this opportunity to ensure there are adequate funds available for those who wish to receive a lump sum payment. 

11. After paying out lump sums, will there still be enough money in the Pension Plan to provide benefits for present and future retirees?
Ford carefully monitors and manages pension plan funding. The company has carefully planned the lump sum opportunity to account for proper funding of the GRP going forward.

12. Is there anything I need to do right now?
No immediate action is required.

Once you are notified of the amount of your lump-sum  in your Election Kit, you will want to consider how taking the lump sum payment option would fit with your retirement financial plan. 

The materials you receive leading up to your election period will help you think through your decision. This is an important decision, and you are encouraged to consult with a financial planner and/or tax advisor. Your Election Kit will outline the details of what you need to do to make an election and will specify the amount of time you have to make a decision.

13. What if I have additional questions about the one-time, voluntary lump sum payment option ― who can I call for help?
A dedicated Pension Lump Sum Information Center will be available to answer your questions during your specific election period. Contact information will be provided in the Election Kit that will be sent to your address of record. Because of the large volume of eligible participants, access to the Pension Lump Sum Information Center cannot be provided to everyone at the same time. Pension Specialists will be available to answer your questions only during your election period. This will help ensure the highest quality service for those who are in the process of making their decision. The Pension Lump Sum Information Center will open at the time of the first election period; therefore, we cannot provide you with a phone number to call right now.

Please wait for your materials to arrive in the mail, read them carefully, and then call the Pension Lump Sum Information Center if you have questions or need additional help during your election period.

 
Your employee benefits are governed by the terms of the applicable official plan document or policy. Summaries of your benefits are available; however, if a conflict exists between any summary and the official plan document, the official plan document prevails. The Company reserves the right to terminate, suspend, or amend any of its employee benefit plans, programs or policies at any time in accordance with applicable plan documents and subject to applicable collective bargaining agreements. You will be notified of any change after it is approved. Until a change is officially announced, no plan fiduciary or any other Company representative is authorized to disclose to you any information about a change under consideration. You should rely exclusively on officially announced information and plan materials. No employee, beneficiary, surviving spouse or other person has any legal or other right to benefits under the Company's employee benefit plans, programs or policies, except as provided by such plans, programs and policies.

 

  

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6/22/2012 11:55 AM