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With interest rates at historically low levels, you should want to take a lump sum!

BTW, anyone who wants to get a rough idea of what their lump sum would buy in the way of a guaranteed stream of income (or what kind of lump sum it would take to replace thier pension) can check here: (click on "Consider an income annuity" and follow the links...)

https://flagship2.vanguard.com/VGApp/hnw/content/PlanEdu/Retirement/PEdInRetOVContent.jsp

Or here.... (click on "request a quote")

http://personal.fidelity.com/products/annuities/?bar=c

I am not recommending income annuities or suggesting these are the best deal around, but they do provide easy to use tools for comparing a lump sum to a stream of "guaranteed" income.

Be advised, however, that insurance companies, which offer income annuities, can go broke too, and if they do, there is no Federal Agency backing them up. You get into some murky State Insurance agency guarantees. Also keep in mind the same issues which are contributing to pension under-funding (low interest rates and lousy returns on stocks) will strain insurers as well.



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