Personal finance tip: take the crummy gold watch instead

General Motors workers in Michigan, Indiana and other places seem pretty underwhelmed by the company's latest buyout offer.

Small wonder. $20,000 and a $25,000 coupon for an unsellable vehicle of your choice isn't much of a deal when you push a pencil on it.

The first problem? That's all taxable income - including the coupon - and potentially enough to kick you into a higher bracket. Your working spouse may need to change some withholding from his or her check to absorb some of the tax shock. And you may face tricky tax calculations a year from now, when you go from having a big shot of extra income to having much less than before.

The second problem? Twenty grand really doesn't go far any more. We'd pick it up if we found it in the parking lot, of course. But it would only last maybe three to four months in many median income Kansas City area homes.

There's a third problem too. That coupon gets to be pretty expensive when you add in the higher property taxes, insurance costs, tags and other new vehicle costs that the coupon doesn't cover. A new 2009 Malibu listing for just less than $22,000 will cost you more than $37,000 over the next five years, the auto wizards at Edmunds.com calculate. Click here to find what it might cost to own something you like better.

So, if you are an auto worker, weigh your choices carefully and start working on a Plan B now. That goes for the rest of us too.