Key Points
- The article is aimed at employees of Lockheed Martin and provides four key questions they should ask when planning their financial future.
- The first question is about understanding how much money they will need in retirement and whether their current savings and investment strategies are on track to meet those needs.
- The second question is about understanding the different types of investment options available to them, such as 401(k) plans, IRAs, and other retirement accounts, and making informed choices about how to invest their money.
- The third question is about assessing their risk tolerance and making sure their investment strategies align with their individual goals and risk profiles.
- The fourth question is about understanding the fees associated with their investments and seeking out low-cost options that can help them maximize their returns over time.
- The article provides additional context and advice for each of these questions, such as working with a financial advisor, understanding the tax implications of different types of investments, and diversifying their portfolios to manage risk.
Introduction
Recently our founder was requested here to respond to a Q&A on what makes financial planning different for Lockheed & Martin employees.
The text is included below:
Get the Most Value from Your Lockheed Martin Benefits and Compensation Package
Throughout the year, Lockheed Martin provides its employees and executives with updates about their benefits ranging from health insurance and health savings plans to retirement plans like a 401(k), deferred compensation plans, and stock options. While the company offers many useful resources and access to knowledgeable staff who can assist with questions, you’ll also find financial professionals not affiliated with Lockheed Martin who specialize in helping Lockheed Martin employees make the most of their income and benefits.
Whether you work in the Lockheed Martin headquarters in Bethesda, Maryland, another office location around the country, or remotely from home, you may have questions about your compensation package and benefits better suited for a financial professional who can offer unbiased advice and guidance.
For example, sensitive topics like discussing the steps you should take before quitting your job at Lockheed Martin to work elsewhere, protecting yourself in advance of a corporate layoff, or deciding when you should plan to retire are all conversations that may be more comfortable with a trusted financial advisor. Should you hire a financial advisor that specializes in helping the employees of Lockheed & Martin or a financial advisor that is less specialized but closer to home?
💡 In the Q&A below, you’ll gain insights from financial advisors who work with Lockheed Martin employees to help them make smart decisions to get the most value from their compensation and benefits, reduce their money stress, and prepare for a comfortable retirement.
🙋♀️ Do you have questions not yet answered? Use the form below to submit questions anonymously and watch this article for updates with answers to your questions. You can also reach out to the financial advisors below to set up an introductory call or contact them with your questions by email.
💸 Smart Money Insights for Lockheed Martin Employees & Executives
This page is organized into sections to help you quickly find the information you need and get answers to your questions:
- Q&A: Financial Planning Tips for Lockheed Martin Employees & Executives
- Get Answers to Your Questions About Your Lockheed Martin Benefits and Career
- Quick Facts & Resources for Lockheed Martin Employees
- Browse Related Articles
Q&A: Financial Planning Tips For Lockheed Martin Employees & Executives
Answers to Employee Questions with Blaine Thiederman, MBA, CFP®
Blaine Thiederman is a financial advisor based in Arvada, Colorado, who specializes in offering financial planning services to Lockheed Martin employees. Blaine helps his clients get the most value from their Lockheed Martin benefits and compensation package so they can enjoy life and feel confident about their financial future.
Q: As a financial advisor with experience helping Lockheed Martin employees save for their retirement, what challenges do you find they often face when building their financial plans?
Q: As a financial advisor with experience helping Lockheed Martin employees save for their retirement, what challenges do you find they often face when building their financial plans?
Blaine: I generally find that Lockheed Martin employees plan too optimistically on one hand (future stock market returns, the reliability of their jobs, lack of bad things happening in the future) and too pessimistically on the other (tax rates going up).
Most Lockheed Martin employees I’ve worked with lack sufficient life insurance, have no estate plan (e.g., a last will and testament, trust, etc.), don’t know how they should prioritize saving for their future, don’t have a scientific process for managing their money, lack any process for managing their budget, and typically assume that their job will be around forever. These are all major assumptions that could be completely inaccurate.
What’s worse is, if Lockheed Martin announces a major layoff due to a decrease in government military spending, you’d expect most jobs in aerospace engineering to have major cuts simultaneously, and as a result, finding a job would be incredibly hard for many of their employees.
The point is, if Lockheed Martin employees plan too optimistically, it could result in their plans falling short and their futures being worse than expected.
Q: What risks are prevalent in the financial lives of Lockheed Martin employees that aren’t significant risks to many other people?
Q: What risks are prevalent in the financial lives of Lockheed Martin employees that aren’t significant risks to many other people?
Blaine: The most important risk faced by Lockheed Martin employees is the fact that few recognize the real risk that future administrations could advocate for a sharp cut in Department of Defense (DOD) spending. Many don’t save enough because they assume things will always be good for Lockheed employees. In preparation for that, it’s important to be conservative with your saving and plans.
Many Lockheed employees don’t necessarily know how to use their equity compensation or deferred compensation packages, which can be substantial. If you’re a Lockheed employee who lacks a scientific approach to using these benefits appropriately, you could be wasting literally tens (if not hundreds of thousands) of dollars in taxes in retirement or taking way too much risk. There are things you should do yourself and others you shouldn’t (this is one you shouldn’t).
Tax planning is another major area that many Lockheed employees typically overlook. Most employees of Lockheed are paid well, and rarely do they need their whole salary, so saving is very affordable. It’s not uncommon for Lockheed employees to have rental properties, significant balances in their bank accounts, large uninvested dollar amounts in HSAs, or poorly constructed saving strategies because there’s so much room for error when you earn much more than you need. This leads to thousands of dollars in wasted taxes for no good reason.
Another unfortunate risk affecting many Lockheed employees is the heightened likelihood of divorce. It’s a well-known fact that people who work 60 hours a week or more are significantly more likely to get a divorce. Without proper planning for a divorce, not only can it make life harder to afford today, but it can make your future more difficult as well.
Q: What are the most valuable and rarely used employee benefits for Lockheed Martin employees?
Q: What are the most valuable and rarely used employee benefits for Lockheed Martin employees?
Blaine: If you’re a Lockheed employee, your employer-sponsored legal services through Hyatt Legal can be incredibly valuable. The cost of an attorney preparing estate documents, reviewing your divorce plan, reviewing trusts, representing you in the event of a DUI, or a slew of other things is incredibly valuable.
Another valuable opportunity involves using a mega backdoor Roth conversion for your Lockheed Martin 401(k) to get additional funds into your Roth 401(k). This is a fantastic way to save potentially as much as $64,500 a year into your Roth 401(k) plan.
And finally, employees should consider taking advantage of the life and disability insurance benefits offered by Lockheed Martin. Insurance policies are expensive, but getting life and disability insurance through your employer-sponsored plan can make it more affordable. Ensuring you don’t just make the right choice on how much of each you should get, but also what kind, is incredibly important to your risk management strategy.
Q: What experience should employees of Lockheed Martin expect from a financial advisor who specializes in working with company employees?
Q: What experience should employees of Lockheed Martin expect from a financial advisor who specializes in working with company employees?
Blaine: Because many Lockheed Martin employees have long work weeks, I understand they may not want to spend a lot of time chatting or tied up in meetings. If any meeting can be replaced with a text message, an email, or a task listed on their planning dashboard, that’s a better experience I strive to deliver and encourage Lockheed employees to look for in any advisor they’re thinking about hiring.
I also believe in being direct, so ensuring the meeting is simple, straightforward, and easy to follow is vital. I follow every meeting by sending an email summarizing the points that I’ve reviewed with them. And by sharing the document I’m taking notes on, my clients can ensure I’m understanding what they’re telling me throughout our conversation.
If you’re a Lockheed employee interviewing financial advisors and any of them say they’re opposed to anything digital, it means more conversations, time, and energy are required of you unnecessarily. That’s not good enough. If your current or prospective financial advisor is incapable of giving you all the information you’re looking for when you ask them “why”, it means they’re likely parroting something their company told them and don’t really understand it and whether it makes the most sense for you at that moment in time.
Q: What are the most important considerations that Lockheed employees should remember as they plan for their financial future?
- Don’t be overly optimistic about anything. You might be wrong and you could ruin your future. This means having enough in emergency savings to get you through potentially 6 months of unemployment, proper amounts of insurance, an estate plan and save more than you need to every month just in case.
- If you intend to hire a financial advisor, make sure they’re fee-only, fiduciaries, and qualified to help someone like yourself with above-average income, assets, and potentially more complex goals and circumstances (early retirement, rental properties, cryptocurrency, etc).
- Even if you earn a good living, don’t forget to ask for raises you deserve based on the market value of your labor. If the market value increases faster than the raises offered by Lockheed (because they tend to be conservative), it means you have to ask for the raise in a logical, prudent way. Some people may say “don’t get greedy”. These people aren’t looking out for your family or you. It’s not greedy to ask for what you’re worth. If you’re worth a lot (can get more money by leaving); ask for a lot. Click here for a guide on how to negotiate for a raise.
- Make sure you invest with your goals in mind and stay diversified. If a financial advisor or a friend tells you to buy an expensive mutual fund (search “expense ratio” + [mutual fund name]” to find out the expenses related to the fund. If they’re over .5%, the funds are likely too expensive), remember that their advice is likely against what countless studies have proven to not just be more scientific but more profitable. Make sure the funds recommended don’t have a “class” because that means the fund has a commission. No point in wasting money on commissions when you can buy low-cost, vanguard funds like what Progress Wealth Management mainly uses.