No. of Recommendations: 0
...I mention this because one option in some pension plans is to take the money and run....

Or to use the lump sum money to buy a better annunity from a third party that has options that your companies annunity might not have.

One possibility with taking a lump sume instead of a pension, it to keep the money invested and then to buy an annunity when you are older, like 75, if you are still alive and in good health then. The cost of an annunity for a 75 years old would be significantely less than a 65 year old. This would also give ten less years for inflation to decrease the value of the pension.

Interest rates and inflation are a major factors in determineing how much an annunity payment or lump sum is so taking a lump sum when interest rates are very low like now, and buying an annunity in five or ten years when interest rates may be higher, could work out very well.

Print the post  


The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.