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Subject:  Re: Traditional pension rant (long) Date:  11/13/2003  11:33 AM
Author:  JAFO31 Number:  37796 of 88495


<<<<Actually, the hit isn't so bad. I take a 23 % hit on my pension to ensure that my surviving spouse who is 5 years younger than me gets the same pension amount.>>>>

"That seems kind of high to me (not saying "high" compared with any other plan, just seems kind of expensive for insurance, which is what it is.)

This probably doesn't apply to you now, and I don't know how the raw numbers work out, but did you consider term insurance vs. the 23% hit back when you made the decision?"

First, term insurance for those 60+ is not necessarily inexpensive, assuming that it is even attainable --- medical testing, etc.

Second, term insurance does not necessarily fill the bill because the term can be outlived. For example, imagine 64 year old retiree male married to 25 year old sweet young thing ('syt') who buys 20 year term. 20 years later he is 84, SWT is 45, with an life expectancy of 40+ years, and he no longer has insurance to make up the difference for loss of his pension when he dies. Can he get another term policy at 84 and what will it cost?

To do this right, it should be a permanent policy that lasts until his death.

Regards, JAFO

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