By Dolores Kong
The Boston Globe

When Rosel Patton, 48, was offered an early retirement
package from the company where she had worked for 24
years, she suffered sleepless nights and headaches
worrying about whether to take it.

"I really was not having a fun time deciding," said
Patton, of Worcester, who started at New England
Telephone when she was 17. "It was kind of an
agonizing thing to do."

Finally, she chose to stay because she hadn't saved
enough in her 401(k) and hadn't lined up another job.
At the end of this month, Patton, an engineer at the
company now called Verizon, will have 30 years of
service to qualify for the regular full pension.

But the financial and health benefits she would get if
she retired today are less than what she would have
gotten if she had taken the buyout six years ago. On
the other hand, she has since been promoted to
management. "You wonder if any of this was the right
decision," she said.

Now thousands of employees across the country are
facing the same decision Patton faced in 1995. With
the current economic slowdown, companies as diverse as
Lucent, Unisys, Ford, Whirlpool, and The New York
Times Co. (parent of The Boston Globe) are offering
early retirement and voluntary buyouts to longtime

For some, the offers are a no-brainer, representing an
easy ticket to retirement or to a long-envisioned new
career. For others, the packages recently landing in
their mailboxes raise a host of agonizing personal
finance and life issues.

But as people who have faced the option know, no
matter how carefully you think through your own
circumstances, in terms of money, health coverage, and
other jobs, the whole basis of the decision can be
upset by social, economic, and pension trends that are
unpredictable and beyond your control.

For instance, companies are cutting back on
traditional pensions and reducing retiree health
benefits, affecting both retirees and employees
thinking about taking a buyout.

"Employers seem to be taking steps to move away from
being in the retirement business, or certainly [taking
steps] toward having their employees and pension plan
participants bear more of the responsibility," said
John Hotz, deputy director of the Pension Rights
Center, a Washington-based nonprofit agency.

Such a trend needs to be considered by anyone being
offered an early retirement or voluntary buyout in
this latest wave of corporate downsizing, say
retirement specialists.

But workers far from retirement also need to take
changing pension plans and other developments into
consideration. People should be saving on their own
and not planning to rely on a fat pension or Social
Security check. A survey last week by the Employee
Benefit Research Institute, a nonpartisan, nonprofit
organization in Washington, found a decrease in the
percentage of workers who said they were confident
about having enough money to retire comfortably, from
72 percent in 2000 to 63 percent this year.

John P. Greaney, 45, of Houston, knew he wanted to
retire early from engineering but didn't want to stay
at a job long enough to qualify for a voluntary buyout
or a full pension. "I got sick of corporate
bureaucracy at an early age," he said.

So beginning at age 25, he began saving aggressively,
maximizing his 401(k) and socking away as much as 40
to 50 percent of his gross pay. He retired at 38, when
his savings totaled $500,000. His portfolio, invested
in stocks and other assets, is now up to about $2

"The pension is not the pot of gold at the end of the
rainbow that a lot of people think," said Greaney, who
runs a Motley Fool early retirement bulletin board and
has his own Web site, www.
featuring spreadsheets, studies, and other resources
to help people retire early.

Greaney, who is single and has no children, golfs two
or three times a week, rents a town house for under
$600 a month, and drives a Nissan Maxima with 60,000
miles on it, which he bought new in 1995. "I just pay
cash for everything," he said. "It may be obvious, but
you want to stay out of debt."

For people who have less savings, more financial
obligations, and a buyout offer on the table, however,
the more applicable lessons may come not from Greaney,
but from Patton, Lou Miano, and C. William Jones, all
of whom were offered early retirement at one time or
another by Ma Bell.

When Patton decided to pass on early retirement in
1995, she couldn't have known that the company was
later going to convert to a so-called cash balance
pension plan that is less favorable than the
traditional fixed pension for older workers.

When Miano, 70, of Needham, and Jones, 62, of Easton,
Md., took early retirement from Nynex 11 years ago,
they couldn't have known that the company was going to
cut generous health benefits and regular inflation
adjustments to the pension.

"Corporate philosophies were very, very different then
than they are now," Miano said. "We had a
cradle-to-grave concept." While he saved on his own
and continues to work because he enjoys it, he knows
the pension changes have affected others. "There are
people out there who are hurting, and still are. The
big fear is you're going to outlive your money."

The changes led Jones and his wife to sell their New
York home and move to lower-cost Maryland. Health care
is more expensive and harder to access today than in
the past. And without those regular inflation
adjustments that the company had historically provided
- and that Jones had counted on - he's seen the buying
power of his pension drop by 30 percent.

Jones, president of the Association of BellTel
Retirees, and Miano, a board member, are trying to
fight back. They're supporting a bill sponsored by
Representative John F. Tierney, the Emergency Retiree
Health Benefit Act of 2001, to protect retiree health
benefits. Tierney, Democrat from Salem, is holding a
meeting about the issue at 1 p.m. tomorrow at the
Saugus Senior Center.

Larger trends aside, the decision about whether to
accept a buyout still boils down to an individual's
particular circumstances, say personal finance and
pension specialists.

"You may think it's a no-brainer, but look at where
you're at. Is this enough money for you to live off
of, to maintain your style of living?" asked Ken
McDonnell, an economist and research analyst with the
Employee Benefit Research Institute.

"Certainly consider the finances, but keep in mind,
there's more to work than finances," said Joseph F.
Quinn, a retirement specialist and dean of Boston
College's College of Arts and Sciences. "There are
cases of people who leave because the finances suggest
it's the right thing to do, yet still regret it."

And for folks facing the choice of taking an enhanced
pension early or continuing to work, "clearly what the
employee has to figure out there is, `If I leave now,
I know what I'm entitled to. Had I stayed, presuming I
was going to be able to stay, how much [longer] would
I need to work to get that enhanced benefit?' " said
Michael Conway, vice president of Ayco, a financial
planning firm based in Albany, N.Y.

For Patton, who turned down a buyout offer six years
ago because she wasn't ready, her circumstances are
different now. She has saved more and "maybe I'm a
little ahead now," despite the pension and retiree
health benefits being less generous. And she's about
to complete a certificate that will allow her to
launch a career in interior design.

"Tell them to make me an offer I can't refuse," Patton
said. "I'd love for them to put it on the table for me