General Electric Retirees Take Another Beating
Many General Electric (GE) retirees have hung onto every share of stock the company ever awarded them because they are justifiably proud of their role in building an iconic American company. But, for many, keeping so much GE stock has put their retirement in jeopardy. At this point, what can they do? Here's what I've been telling GE retirees who contacted me after I published The One Stock You Should Not Put In Your Retirement Account.
How Much Worse Can It Get?
These conversations often started along these lines:
GE is at $15 (in April), down more than 50% since John Flannery replaced Jeff Immelt as CEO in August 2017. In addition, Flannery already cut the quarterly dividend in half to 12 cents a share. How much worse can it get?
In April, the retirees I spoke with saw the 50% drop in the stock price as an over-reaction and hoped that by cutting the dividend in half, they were contributing towards fixing the company.
I admired their loyalty. You don't see that kind of loyalty much these days. But I still urged them to put their own financial well-being ahead of GE's especially because GE's pension plan, on which they all depended, was under-funded by $31 billion.
When you invest your portfolio in the same company that pays your pension, your future is tied to that company's success. If you don't like where the company is going, you have to break the tie.
https://www.forbes.com/sites/kenkam/2018/11/02/general-electric-retirees-take-another-beating/#2847df17ca20