Healthcare Provider Update: Healthcare Provider for Lockheed Martin Lockheed Martin primarily partners with UnitedHealthcare to provide healthcare benefits to its employees. This collaboration allows Lockheed Martin to offer comprehensive health plans tailored to meet the diverse needs of its workforce across various locations. Healthcare Cost Increases in 2026 As healthcare costs are projected to rise significantly in 2026, Lockheed Martin employees may face increased out-of-pocket expenses. Following trends revealed in recent reports, health insurance premiums for many states are slated to soar, with some seeing hikes exceeding 60%. Contributing factors include rising medical costs due to inflation and the anticipated expiration of federal premium subsidies, which could push the average increase for consumers to over 75%. The combination of these elements suggests that both employees and employers may need to strategize for heightened healthcare expenses in the coming year. Click here to learn more
“Lockheed Martin employees evaluating downsizing should view strategies like assumable mortgages not simply as real estate decisions, but as part of a coordinated retirement income and liquidity plan that weighs cash flow, long-term flexibility, and estate considerations within their broader financial picture.” – Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.
“Lockheed Martin employees approaching retirement should evaluate housing transitions such as assumable mortgages through the lens of overall retirement cash flow, liquidity, and long-term planning priorities, rather than viewing the mortgage decision in isolation.” – Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
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How shifting mortgage rates may influence downsizing decisions for Lockheed Martin employees.
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What an assumable mortgage is and how it works.
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Key financial and strategic considerations when evaluating a move in retirement.
by Neva Bradley, CFP®, Wealth Enhancement
If you’re a Lockheed Martin employee and part of the Baby Boomer generation, your home may feel very different today than it did 20 years ago.
Children’s bedrooms may now serve as guest rooms. The formal dining room might only see use during the holidays. The yard may feature more maintenance than enjoyment. Even if you love the house, it may simply feel larger than you need at this stage of life.
At the same time, many younger families are living in homes that feel too small.
Mortgage rates were historically low in 2020 and 2021. In the first half of 2021, the 30-year fixed-rate mortgage averaged roughly 2.9%, with periods dipping below 3%, according to Freddie Mac. 1
More recently, average rates have been noticeably higher—something Lockheed Martin employees considering a move have likely observed.
Because of this shift in the rate environment, many retirees may not have considered a strategy that could still be relevant today.
It’s called an assumable mortgage.
An Assumable Mortgage: What Is It?
Subject to program regulations and buyer approval, an assumable mortgage allows a buyer to take over a seller’s existing loan—including the original interest rate.
That means instead of applying for a brand-new mortgage at today’s higher rates, a buyer may be able to step into a prior low-rate loan, if the loan qualifies. For Lockheed Martin employees planning to downsize, this can be significant.
Instead of selling your larger home, purchasing a smaller property, and taking on a new mortgage at current market rates, you may be able to sell your larger home, downsize your living space, and assume an existing lower-rate mortgage, if eligible.
That interest rate difference can meaningfully impact monthly cash flow.
Why This May Appeal to Some Retirees
For many retirees, being completely mortgage-free is not the only objective.
- They value liquidity.
- They want flexibility.
- They prefer to keep investable assets working.
Carrying a mortgage below 4%—or even below 3%—while maintaining invested capital can be a deliberate allocation decision, particularly when considering inflation and long-term return expectations. For long-tenured Lockheed Martin employees with substantial home equity and retirement savings, this can become part of a broader strategy discussion.
Taking on a significantly higher-rate mortgage when a lower-rate option may exist is worth thoughtful evaluation in today’s environment.
Important Considerations
Not all mortgages are assumable. Certain government-backed loans, such as FHA and VA loans, may allow assumption with the lender's approval and adherence to program guidelines. 2,3 Conventional loans are often not assumable unless specifically stated in the original loan terms.
There are also two practical realities to understand.
1. The Equity Gap
If a home has appreciated significantly since 2021, when rates were lower, the remaining loan balance may be far lower than the current purchase price.
Home values rose sharply between 2020 and 2022, according to the S&P CoreLogic Case-Shiller U.S. National Home Price Index. 4
In this case, the buyer would need to cover the price difference—typically through cash or secondary financing.
For Lockheed Martin employees who have built meaningful equity in long-held homes, this may be manageable, but it requires planning.
2. The Approval Process
Mortgage lenders must approve the buyer. The process can take longer than a traditional mortgage due to documentation and underwriting requirements.
This is not typically a last-minute strategy. It should be evaluated alongside retirement income planning, liquidity needs, estate goals, and tax considerations.
Downsizing Is About More Than Square Footage
Downsizing can affect:
- Cash flow
- Portfolio sustainability
- Proximity to family
- Lifestyle flexibility
Many retirees unlock substantial equity when selling a long-held home. That equity can potentially:
- Support retirement income
- Reduce reliance on portfolio withdrawals
- Create opportunities for gifting
- Strengthen estate planning strategies
Meanwhile, the purchasing family may gain the space they need. In certain circumstances, this can be mutually beneficial.
Paying Cash vs. Keeping a Low-Rate Mortgage
Some retirees believe paying cash for a smaller property is always the best move.
However, if a lower-rate mortgage can be assumed and long-term portfolio return expectations exceed that rate, maintaining liquidity may be a rational strategic choice. For Lockheed Martin employees accustomed to balancing risk, capital allocation, and long-term planning in their careers, this framework often feels familiar.
This is not about increasing leverage unnecessarily. It is about balancing long-term sustainability and personal comfort with risk.
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The Broader Housing Environment
The Federal Reserve Bank of New York has studied what’s called the “mortgage rate lock-in” effect—where homeowners with low-rate mortgages hesitate to move because prevailing rates are much higher. 5 This dynamic has contributed to reduced housing turnover in recent years.
In that context, assumable mortgages can occasionally help facilitate transactions that might otherwise be difficult under higher prevailing rates.
Is This Strategy Right for You?
Before pursuing an assumable mortgage approach, consider:
- Is the property eligible?
- How much capital is required to bridge the equity gap?
- How does keeping—or paying off—a mortgage affect your overall retirement plan?
- How does this decision align with your income and estate planning strategy?
Housing decisions should not be separated from retirement planning.
At The Retirement Group, we help Lockheed Martin employees evaluate significant financial transitions—like downsizing—within the context of their broader retirement income, tax, and legacy strategies. If you are considering a move within the next one to three years and want to determine whether this approach may fit your situation, you can call The Retirement Group at (800) 900-5867 to discuss your retirement planning needs.
Sources:
1. Freddie Mac. “Refinance Trends in the First Half of 2021.” Freddie Mac Research , 29 Oct. 2021, https://www.freddiemac.com/research/insight/20211029-refinance-trends . Accessed 16 Feb. 2026.
2. U.S. Department of Housing and Urban Development. “Are FHA-Insured Mortgages Assumable?” HUD Answers , 19 Jan. 2026, https://answers.hud.gov/FHA/s/article/Are-FHAinsured-mortgages-assumable . Accessed 16 Feb. 2026.
3. U.S. Department of Veterans Affairs. VA Home Loan Guaranty Buyer’s Guide . April 2022, https://www.benefits.va.gov/homeloans/documents/docs/VA_Buyers_Guide.pdf . Accessed 16 Feb. 2026.
4. Federal Reserve Bank of St. Louis. “S&P CoreLogic Case-Shiller U.S. National Home Price Index (CSUSHPINSA).” FRED: Federal Reserve Economic Data , updated 27 Jan. 2026, https://fred.stlouisfed.org/series/CSUSHPINSA . Accessed 16 Feb. 2026.
5. Aidala, Felix, Andreas Fuster, and Paul Goldsmith-Pinkham. “Mortgage Rate Lock-In and Homeowners’ Moving Plans.” Liberty Street Economics , Federal Reserve Bank of New York, 6 May 2024, https://libertystreeteconomics.newyorkfed.org/2024/05/mortgage-rate-lock-in-and-homeowners-moving-plans/ . Accessed 16 Feb. 2026.
How does Lockheed Martin determine the monthly pension benefit for employees nearing retirement, and what factors should employees consider when planning their retirement based on this calculation? Specifically, how do the concepts of "Final Average Pay" and "Credited Years of Service" interact in the pension calculation under Lockheed Martin’s retirement plan?
Lockheed Martin Pension Calculation: Lockheed Martin calculates monthly pension benefits using the "Final Average Pay" (FAP) and "Credited Years of Service" (CYS). The FAP is determined by averaging the three highest annual compensations prior to 2016, while CYS counts the years from employment start to December 31, 2019, when the pension was frozen. The benefit per year of service is calculated based on whether the FAP is less than or exceeds the Social Security Covered Compensation, with specific formulas applied for each scenario. These calculations directly affect the monthly pension benefit, which may also be reduced if retirement commences before a certain age due to early retirement penalties.
Given the recent changes in Lockheed Martin's pension policy, what implications could this have for employees who are planning to retire in the near future? How should these employees navigate their expectations regarding retirement income given that the pension has been frozen since 2020?
Implications of Pension Freeze: Since Lockheed Martin froze its pension plan in 2020, no future earnings or years of service will increase pension benefits. This freeze shifts the emphasis towards maximizing contributions to 401(k) plans, where Lockheed Martin increased its maximum contribution to 10% for non-represented employees. Employees planning for imminent retirement should recalibrate their financial planning to account for this change, prioritizing 401(k) growth and other retirement savings vehicles to compensate for the pension freeze.
What options does Lockheed Martin provide for employees regarding healthcare insurance as they approach retirement age? How do these options compare in terms of coverage and cost, particularly for those who will transition to Medicare upon reaching age 65?
Healthcare Options Near Retirement: As Lockheed Martin employees approach retirement, they can choose from several health insurance options. Before Medicare eligibility, they may use COBRA, a Lockheed Martin retiree plan, or the ACA's private marketplace. Post-65, they transition to Medicare, with the possibility of additional coverage through Medicare Advantage or Medigap plans. Lockheed Martin supports this transition with a Health Reimbursement Arrangement, providing an annual credit to help cover medical expenses.
Understanding the complex nature of Lockheed Martin's pension and retirement benefits, what resources are available to employees to help them navigate their choices regarding pension claiming options? In what ways can the insights from these resources aid employees in making informed decisions about their financial future?
Resources for Navigating Retirement Benefits: Lockheed Martin employees have access to resources like the LM Employee Service Center intranet, which includes robust tools such as a pension estimator. This tool allows for modeling different retirement scenarios and understanding the impacts of various pension claiming options. Additional support is provided through HR consultations and detailed plan descriptions to ensure employees make informed decisions about their retirement strategies.
For employees with varying years of service at Lockheed Martin, how can their employment history impact their pension benefits? What strategies should individuals explore to maximize their benefits given the different legacy systems that might influence their retirement payout?
Impact of Employment History on Pension Benefits: The length and nature of an employee’s service at Lockheed Martin significantly influence pension calculations. Historical changes in pension policies, particularly the transition points of the pension freeze, play critical roles in determining the final pension benefits. Employees must consider their entire career timeline, including any represented or non-represented periods, to understand and maximize their eligible pension benefits fully.
How does the Lockheed Martin retirement plan ensure that benefits are preserved for spouses or dependents after an employee's passing? How do different claiming options affect the long-term financial security of the employee's family post-retirement?
Benefit Preservation for Dependents: Lockheed Martin's pension plan includes options that consider the welfare of spouses or dependents after an employee's passing. Options like "Joint and Survivor" ensure ongoing benefits for surviving spouses, while choices like "Life with X-Year guarantee" provide continued payments for a defined period after the employee’s death. Understanding these options helps secure long-term financial stability for beneficiaries.
What steps can Lockheed Martin employees take to prepare financially for retirement, especially if they have outstanding loans or financial obligations? How crucial is it for employees to understand the conditions under which these loans must be settled before retirement?
Financial Preparation for Retirement: Employees approaching retirement should focus on clearing any outstanding loans and maximizing their contributions to tax-advantaged accounts like 401(k)s and Health Savings Accounts (HSAs). These steps are crucial for ensuring a smooth financial transition to retirement, minimizing potential tax impacts, and maximizing available retirement income streams.
With the evolution of Lockheed Martin's retirement initiatives, particularly the shift toward higher 401(k) contributions, how should employees balance contributions to their 401(k) with their overall retirement savings strategy? What factors should they consider in optimizing their investment choices post-retirement?
Balancing 401(k) Contributions: With the pension freeze, Lockheed Martin employees should increasingly rely on 401(k) plans, where the company has increased its contribution cap. Employees must balance these contributions with other savings strategies and consider their investment choices carefully to ensure a robust retirement fund that can support their post-retirement life.
How does Lockheed Martin's approach to retirement planning include the management of health savings accounts (HSAs) for retirees? What are the tax advantages of HSAs, and how can employees effectively utilize this resource when planning for healthcare expenses in retirement?
Management of HSAs for Retirees: Lockheed Martin encourages maximizing contributions to Health Savings Accounts (HSAs), which offer significant tax advantages. These accounts not only provide funds for current medical expenses but can also be used tax-free for healthcare costs in retirement, making them a critical component of retirement health expense planning.
What is the best way for employees to contact Lockheed Martin regarding specifics or questions about their retirement benefits? What channels of communication are available, and how can they access the most current and relevant information regarding their retirement planning? These questions aim to encourage thoughtful consideration and discussion about retirement planning within Lockheed Martin, addressing various aspects of the company's benefits while promoting engagement with internal resources.
Contacting Lockheed Martin for Retirement Benefit Queries: Employees should direct specific inquiries about their retirement benefits to Lockheed Martin's HR department or consult the benefits Summary Plan Descriptions available through company resources. These channels ensure employees receive accurate and comprehensive information tailored to their individual circumstances.
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