Fiat Chrysler Automobiles (FCA) has announced it will offer approximately 7,300 salaried employees that have a vested pension with Chrysler, are separated, and have not started receiving their pension, the option to receive a voluntary lump sum pension benefit payment. This group will be offered one of three options.

  1. Receive the pension in a Lump Sum
  2. Begin receiving monthly pension payment as early as December 2016, or
  3. Wait to receive the monthly pension payment as specified under the terms of the plan

FCA retirees and former employees impacted by this offer will receive an Election Kit, Decision Guide, and Tip Sheet by mail in the next few weeks. However, there are several situations that would result in a person being excluded from this offer.

By taking advantage of the lump sum pension payment option, FCA retirees and former employees may reduce many potential pension risks including longevity risk due to inflation, tax risk, and mortality risk. Most importantly it will completely eliminate "PBGC risk" - the risk that monthly pension payments are someday reduced by the Pension Benefit Guaranty Corporation. However, whether to take a lump sum payment or not is based on one’s personal situation and these factors deserve individual attention and should be reviewed with a qualified professional.

If you would like assistance in navigating this very important retirement decision, contact one of our Certified Financial PlannersTM toll-free at 1-866-444-6246.