Tossed Overboard

GM Jettisons Healthcare For Retirees…

GM Announced today that it will be eliminating healthcare coverage for its retirees aged 65 and older.  Reeling with problems, GM is only the latest entity (in what will surely be a growing list of iconic U.S. companies) to rethink its promises made to employees.

GM’s decision to cut retiree healthcare benefits impacts tens of thousands of retirees–and the move is surely to leave the company with a serious black-eye.

In a recent statement from the UAW, officials expressed their opinion.  “We believe that GM is both legally and morally obligated to pay retiree medical benefits [but] the company’s obligation is largely unfunded.”

And that, I believe, is at the heart of the issue.

Too many American companies have made grandiose financial promises to their employees and retirees–promises that they cannot possibly honor. 

And for those of us who are still employed, there’s a lesson to be learned in all of this. 

Do not believe the primrose, pie-in-the-sky, guarantees that have been made.  Every working American, in essence, needs to accept that reality that they are, in fact, being cut loose.

So what needs to be done?

Start developing–and funding–your own strategy for survival in your retirement years. Recent estimates suggest that each of us will need about $225,000 to fund health care in our retirement years. 

Sounds like a lot of money?  It is. And the journey won’t be an easy one–especially in these economically challenging times. 

But if you’re smart, you’ll start saving now.

And while that’s a legitimate option (albeit a painful one) for a lot of us, you still can’t help but feel bad for the GM retirees that just got tossed overboard.