Dealing with Restructuring

By David Chazin

Apparently not even major energy companies are immune to the negative effects of this pronounced economic downturn. Given the "resource optimization management" the company has recently undertaken, this is an understandably uncertain time. As a financial planner, I talk with people all the time who are transitioning between jobs-especially in this economy-so I know how difficult it can be, emotionally and financially.

While some people have volunteered to take a buyout, most employees are going through the "ROM" process and hoping to stay there long into the future. Nobody knows exactly what the future holds though, so it may be a good time to take stock of where you are financially, so you can make any necessary preparations should you be negatively affected.

While I hope nobody reading this is among those having to go job hunting elsewhere, I would like to help you make the best of your financial situation if your circumstances change. Asking yourself the questions below is a good starting point.

  • What analysis have I done to determine if I'll have enough assets to retire?

  • When do I want to retire and where do I want to live?

  • Can I contemplate retiring or do I need to continue to work?

  • Do I want to change job functions or accept a different pay grade? Can I afford not to?

  • How much of an emergency fund (for example, six months' worth of living expenses) do I need?

  • How much would health insurance cost if I were to get it on my own?

  • How well can I grow my money by investing on my own?

  • Do I have too much of my net worth tied to Chevron stock?

  • Is my money protected from another market downturn or an unforeseen disaster (like BP)?

  • How have my investments fared compared to others?

  • Do I want to look into other vehicles beyond the few I'm limited to in the ESIP?

  • Do I fully understand my stock options (LTIP), DCP, RRP, etc.?

  • Do I want to take my CRP pension as a lump sum or monthly payment?

  • Do I want to have more control over my money?

  • What are my monthly expenses?

  • How can I draw money from my ESIP?

  • Do I need additional life insurance if I'm no longer covered through work?

  • Do I want to leave money for my children or other beneficiaries?

  • Do I have my wills and trusts taken care of and up-to-date?

As a financial planner, I can't help you with the emotional component, however I can help you understand the pros and cons of your various alternatives and conduct the analysis you need to make decisions about what to do next, at least financially. The most important thing is that you have a solid plan in place that you feel comfortable with, allowing you to make the most educated decisions.

There are a myriad of issues to consider, such as your retirement, life insurance, estate documents, and overall investment strategy. While I can't help you determine whether or not you'll still be with the same company, I can help you understand where you are financially.

I'd be happy to sit down with you to evaluate how you're positioned during the ROM. Because I work with many executives, managers, employees and retirees, I'm very knowledgeable about your various compensation plans and benefit offerings, plus other issues specific to employees in your situation (in addition to the retirement, investment, and estate planning issues everybody faces). Please contact me at (925) 659-0251 with specific questions or to schedule a time to meet.

David Chazin, Insight Wealth Strategies and Lincoln Financial Advisors Corp are not affiliated with Chevron.