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OK - perhaps a more reasoned response is in order.

1. You're 20% per year assumption is just outrageous. If you could guarantee 12% per year, you'll have lots of people throwing money at you to invest. A more realistic number is closer to 8%.

2. As has been noted, you don't mention how much of that 10,500 per month would be lost in favor of the $700k lump sum. That has a significant bearing on the decision.

3. Another factor is your personal life expectancy. Generally, the worse your health and life expectancy, the more valuable that lump sum becomes. I am assuming that the monthly pension would stop at your death. You need a reasonable expectation of surviving long enough for the monthly payouts to exceed the lump sum value. With a somewhat early retirement (about 55 for your wife and 60 for you) those monthly checks should keep going for a a good long time.

And while you're thinking about those monthly checks, are they for your life only, or is there a survivor benefit? Is there any minimum guarantee if you or your wife die soon after starting the monthly payments?

I guess a more reasoned response is that it is quite likely the monthly payments are the much better deal for you. But there are some mitigating factors that could make the lump sum a better choice for certain individuals. And those factors have nothing to do with how good you are at investing the lump sum.

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